(what??? I just reported this from the longside and these guys quote the banksters??? for info??? Do not be fooled: For every short dropped by the banksters, there is a long dropped from the other side as this is a zero sum game. Be well read and you will see through the nonsense...)
04 July 2011, 04:41 p.m.
By Allen Sykora
Of Kitco News
http://www.kitco.com/
http://www.kitco.com/reports/KitcoNews20110704AS_CFTC.html
(Kitco News) - Money managers have slashed their net long, or bullish, positioning in U.S. gold futures and options to the lowest level in more than four months and in silver to the lowest level in more than a year, according to the most recent data from the Commodity Futures Trading Commission.
The agency’s weekly commitments of traders report shows that much of the selling in the week to June 28 came in the form of long liquidation, or selling to exit long positions, rather than outright selling on bearish views.
All of the precious metals fell during the week covered by the most recent CFTC data, released on Friday. Comex August gold settled at $1,500.20 an ounce on June 28, down $46.20 from the June 21 close. September silver fell $2.741 for the week to $33.652. October platinum lost $57.10 to $1,693.50, while September palladium slid $32.10 to $735.15.
However, the net long rose for copper, the one base for which the CFTC compiles weekly data. September copper was virtually flat for the week, gaining 0.10 cent to $4.1080 a pound.
For Comex gold, the drop-off in speculative net-long positioning was the greatest in almost a year and the current level is the lowest since February, Commerzbank reported.
Managed-money accounts slashed their net long by 20% to 181,356 lots for futures and options combined, the lowest level since Feb. 15, and well down from 226,501 in the previous week to June 21. This occurred as these accounts trimmed their total longs—or exited bullish positions--by 43,342 lots. There was a far smaller increase of 1,802 short, or bearish, positions.
Under the CFTC’s older “legacy” reporting format, the large non-commercial accounts—generally referred to as the funds—cut their net long position to 194,557 lots, the lowest since Feb. 8 and down from 238,788 a week ago.
“Since the price of gold has continued to fall after the last statistical cut-off date (of June 28), even more positions have probably meanwhile been closed down,” Commerzbank said. From June 28 to Friday’s close ahead of the long U.S. Fourth of July weekend, August gold lost another $21.90 per ounce.
Standard Bank calculated that the total net speculative position for gold now stands at 625.5 metric tons, well below last year’s average of 777.6.
“Although the sharp fall in net speculative length underscores the susceptibility of gold to speculative sell-offs, we still feel that,
from a fundamental perspective, there is potential for further upside over the medium term,” Standard said. “We would, however, caution that over the short term, given that speculative short positions are currently at 123.1 tons, well above last year’s average (90.7 tons), sentiment is less supportive--which could see the gold market more volatile than usual.”
Meanwhile, for silver, fund managers scaled back their net long positions by an even higher percentage. In the disaggregated report, money managers pared their silver net long by 26% to 15,089 lots for futures and options combined, compared to 20,296 the prior week, and the lowest level since February 2010. This was due to a mixture of long liquidation (total longs fell by 3,256) and fresh selling (total shorts rose by 1,951).
In the legacy report, the non-commercials cut their net long to 21,564 lots from 25,735, again due to a mix of liquidation and fresh shorts. This net long position is now the lowest since July 2009.
“However, pressure on silver from this front should ease in the future,” Commerzbank said.
For commodities markets generally, when net-long positioning hits longtime lows, analysts view this as an indication that long liquidation has about run its course. Conversely, when net-long positioning hits historic highs, this often is viewed as a sign that the most potential buying already may have occurred.
In the case of platinum, money managers cut their net long by 16% to 14,402 lots from 17,122 the previous week. This now stands as the lowest level since last August, with the decline mostly due to liquidation, as the number of total longs fell by 2,413. In the legacy report, funds scaled back their net long to 16,988, the lowest level since September, compared to the previous week’s 20,127 lots, also mainly due to liquidation.
Funds also cut their bullish positions in palladium although not as sharply as in the other precious metals. In the disaggregated report, money managers cut their net long by 10% to 10,087 (the lowest since May 24) from 11,163 the previous week. In the legacy report, they pared their net long to 11,272 from 12,648.
Copper Net-Long Position Bucks The Trend And Rises
While funds were scaling back bullish positions in all of the precious metals, they added to them in copper, the CFTC data show. In the disaggregated report, money managers upped their copper net long by 19% to 8,893 lots for futures and options combined, compared to 7,481 the previous week. This was due to a combination of fresh buying (number of total longs rose by 647) and short covering (total shorts fell by 765).
Meanwhile, in the legacy report, the funds upped their net long to 10,003 lots from 9,778 the previous week.
“The price rise after the cut-off date for these statistics suggests that these investors are meanwhile betting even more on price gains,” Commerzbank said. From the June 28 cut-off date for the most recent CFTC report into Friday’s close, September copper gained another 19.45 cents a pound.
By Allen Sykora of Kitco News; asykora@kitco.com
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