This week hedge funds dumped 34,256 long gold contracts.
Hedge funds ditch 34,256 gold contracts!
June 25 (King World News) – Alasdair Macleod: Tonight’s Commitment of Traders Report showed a big unwinding of positions. The non- Specs between them reduced their net shorts by 28,844 contracts, and the Managed Money category (hedge funds) cut their net longs by 34,256 contracts to a 62,536. This is illustrated in the table below.
The neutral position for the Managed Money category is net long 110,000 contracts, so a net long position of 62,536 leaves plenty of room for an increase before this category is judged to be overbought. Our next chart shows the history of this category’s net position.
Since 2006, net positions for managed money have only turned net short on two occasions. The first was just before the current bull market commenced in December 2015, and the second in October 2018, after the price plummeted to $1160. But given the current hyperinflationary conditions, we are unlikely to see that happen this time.
It is also worth noting that the Swaps’ campaign to close down their shorts pushed open interest down by 26,187 contracts to 453,940. Since then (last Tuesday), it has reduced slightly further to 452,432.
This week saw option expiry for the July contract. The fact that 82,954 calls were abandoned illustrates why gold was encouraged to fall from $1900 from 10 June to the current $1778. Furthermore, with the half year ending next week, bullion bank traders will want to keep prices suppressed for favourable (for them) mark-to-market valuations.
In July, these bearish factors will disappear, and as soon as the dollar resumes its weak trend, we can expect to see gold rise from these levels —perhaps significantly….to listen to Alasdair Macleod discuss what investors should expect to see next week after Basel III implementation CLICK HERE OR ON THE IMAGE BELOW.
Also released: Two Different Paths Being Taken By Central Banks, Infrastructure Bill, And When It Comes To Inflation “Let’s Pray” CLICK HERE.
Also released: Look At What Is Up The Most In 25 Years! CLICK HERE.
Also released: Macleod – Yes, We Are Headed Into A Hyperinflation Nightmare CLICK HERE.
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