Some caution does not hurt here -g-.
1) Seasonal weakness into mid-November is approaching (from October, 5-7)
2) COT is record short, specs very long. They can always force specs out.
3) We got to February peak of 392. Naturally, this is resistance
4) Today is options expiration, with A LOT of calls in the money. Generally, this requires SOMEONE who sold these calls to be long futures.
Now that the calls expired, these long positions will be liquidated, unless
5) They are too short otherwise.
Anyway, I think POG may explode higher from here, but it could also implode, and do so in a remarkable fashion, if the long speculators decide to SELL. Most contracts which specs are record long are December contracts (both calls and futures). Do THEY want them to close in the money? I don't think so! They will try to kill it, here and now, because 392 is pretty much their last defence before 400-s. It may explode on short covering, once we get into 400-s. |
