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Article - The COMEX Silver CoT - Craig Hemke
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Thread: Article - The COMEX Silver CoT - Craig Hemke

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    Default Article - The COMEX Silver CoT - Craig Hemke

    There's been a lot of talk these past few days about the "bullishness" of the latest Commitment of Traders Report for COMEX silver—and rightfully so. However, without some context, it's difficult to determine the degree to which the latest report is historic and unprecedented.

    Here's what we know: For the first time in nearly 15 years, the group called "Large Speculators" (hedge funds, trading funds, managed money, etc.) on the Commitment of Traders "Legacy" report is NET SHORT COMEX silver futures. But what does this imply, and what, if anything, is the significance? To answer these questions, we must look back and research similar positioning and price. To begin with, the most recent CoT showed the following:

    Large Speculators long 63,023 contracts.

    Large Speculators short 64,531 contracts.

    This gives a NET short position of 1,508 COMEX silver contracts.

    As mentioned above, this is the first time since the report surveyed April 1, 2003 that the Large Specs have carried a NET short position. However, in the past 30 months, they've come close to crossing this threshold twice.

    On the CoT report of July 24, 2015, the NET position of the Large Specs in silver bottomed out at just 4,245 contracts long. Interestingly, this report was surveyed just four days after the publication of the infamous Wall Street Journal article that proclaimed gold to be a "pet rock": http://jasonzweig.com/lets-be-honest-about-gold-it...

    The price of COMEX silver did NOT immediately bottom thereafter, and it's vitally important for you to understand that the CoT is often a lagging indicator of future trend. However, as you can see below, price was near $14.50 at the time of the report, and it rallied to a high of $16.20 less than 90 days later. That's a 12% rally within the context of what was an ongoing bear market, with most gains not coming until September.


    http://silverseek.com/article/comex-silver-cot-17140
    Last edited by valerb; 8th March 2018 at 07:16.
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