Mostly: Classical

[lvlamb]

Commentary?
Foist, I am working on a way to handle those charts with other indictors/layouts
What I have to deternine is:

- what is the percentage of (or is it a fixed anount) of contracts which are directly related to the specific market
For instance, Australian miners already have sold all the reserves forward, nobody knows if that gold will ever be mined
Other example, LUV used to take positions on oil for 2 years consumption ahead (part of a "fixed" OI in a specific contract). Given the oil prices of the last years, I could expect that all forward positions of LUV have been exhausted.

- relation of speculative positions due to indexing (this is a huge component of the equities markets rise in prices) vs. speculative trading/position trading/arbitrage

Both volumes in OI have to be determined (commodity per commodity, market specifics) before one could evaluate which part of the OI is due to sector/geographical region rotation.
I believe this last component of the OI is the one to watch: beyond market specifics, is there new money rotating into the commodity.

If you look at the LT OI on silver, the average is a constant, while on gold, the average rose from 125K in 1986 to 200K currently. So, some commodities have historical known levels, other have a varying level: is this one linear or cyclical?

Now, for gold, open interest waves (statistically a joke as there are only two) seem to be 10-11 years, not 7-8 if you only look at the prices. This could mean that OI now is reaching the top (other tops: 1986 and 1996), but 1996 could only have been the result of the strong Dollar policy.

Now, the short term chart:
two highs to analyze in the commercials net shorts, April 2004 and October 2004. If the current rebound from January cannot does not takes October 2004, April 2004 should have to be considered as a peak and OI considered to be in the downtrend (and we already had both a lower high and a lower low).

Hence, either the price high was made last year (case the lower high in OI is confirmed by a seconf lower high), or a double top or new high is made on the OI net, meaning that the Aug-Nov price rally of last year only was cat piss.
In any case, the top in price was last Fall (price cycle) or the latest in Fall 2006 (OI cycle). Enough uncertainty to lose fortunes. <ng>.

Next time, don't ask for a commentary <vbg>!