Big changes in gold COT strike Arensberg, Turk, Lundin as bullish


Huge Gold Short Position Detailed in Commitments of Traders

By Myra Saefong
Monday, February 25, 2013

After a selloff that dragged gold futures down by more than 2% last week, Monday's rebound isn't much of a surprise, and some analysts say that a report released Friday has a lot to do with it.

Analysts pointed out some interesting developments in the Commitments of Traders report released by the U.S. Commodity Futures Trading Commission.

"The producer merchants, the category that includes the natural hedgers, are at their lowest net short position since 2008 at the same time that the managed money traders, the funds, are record short and at their lowest net long position since November 18, 2008," said Gene Arensberg, editor of the Got Gold Report. "I have not seen the COT 'rubber bands' so overstretched in opposite directions as they are now."

... Dispatch continues below ...


How to profit in the new year with silver --
and which stocks to buy now

Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million.

Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets.

To learn about this report, please visit:

The funds showed a collective reduction of nearly 36%, or 23,772 contracts, in their net long gold positions to an "extremely low" 42,810 contract net long positions, according to Arensberg.

Extreme lows for the managed money net long positions are "usually associated with important bottoms for the price of gold," said Arensberg.

James Turk, founder and chairman of GoldMoney, said the COT report was "unprecedented," in part because the professional traders category "had one of the largest switches from long to short that I can recall."

He pointed out that the report was based on data only from Tuesday, "so it does not even capture the additional shorting that was likely when gold was under pressure the rest of the week."

He also see the extreme bearish levels as laying the groundwork for a rebound like Monday's.

"It means that the short position in gold is huge and potentially vulnerable," he said. "In other words, it could lead to a buying panic by the shorts if the gold price continues to climb higher as it is doing today."

On Monday, April gold traded at $1,589.40 an ounce, up $16.60, or 1.1%. It settled Friday at its lowest level in seven months.

Basically, the market can gather two things from the COT report, said Brien Lundin, editor of Gold Newsletter. "We can expect very high volatility and at some point a powerful short-covering rally should occur," he said.

* * *

Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:

Or by purchasing a colorful GATA T-shirt:

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

To contribute to GATA, please visit:


GoldMoney adds Singapore vaulting option

In addition to its precious metals storage facilities in Hong Kong, Switzerland, Toronto, and the United Kingdom, now with GoldMoney you can store gold and silver in Singapore in a high-security vault operated by Brink's Singapore Pte Limited. To find out more about the new vault, please visit:

GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.

It's easy to open an account, add funds, and liquidate your investment. For more information, visit: