Direxion Daily Gold Miners Be (DUST)

[Solantey]

"Weekly COMEX Gold Inventories: Huge Friday Sell Order Equivalent To 70% Of Gold Registered For Delivery"

From the article at SeekingAlpha:

What does this Mean for Gold Investors:

In short the story hasn't changed for gold investors in terms of the bullishness seen in the extremely low levels of COMEX gold inventories. But what investors should realize is that the electronic volumes that are being traded are so much greater than COMEX gold available for delivery. They should also note that there is an obvious attempt to push the price lower by entities with short positions - after all how else can you explain a 5,000 market sell order with no news during relatively thinly traded hours other than an attempt to ignite negative momentum?

So extremely low physical gold stocks available for delivery and entities with large short positions trying to push the price lower with huge market sell orders is not a recipe for a stable market. At some point we're going to have a scramble for the physical gold as either someone decides to call the bluff of these large shorts trying to push prices lower (think Icahn versus Bill Ackman), or the physical demand from Asia (Hong Kong reported tremendous gold import numbers during August from the US and Switzerland) is going to overwhelm the paper traders and force a cover. Either way we believe that the instability in the gold market is going to cause a sharp, sudden, disorderly rise in the gold price.

Thus we see no reason to change our bullish stance on gold based on COMEX gold inventories, and we recommend investors continue to accumulate physical gold and the gold ETFs (GLD, PHYS, CEF) while the physical gold supply continues to drop. For investors looking for higher leverage to the gold price, they may want to consider miners such as Goldcorp (GG), Yamana Gold (AUY), Randgold (GOLD), or even some of the explorers and silver miners such as First Majestic (AG). Finally, investors who own shares in some of the market ETFs (like SPDR S&P 500 (SPY), PowerShares QQQ (QQQ), and SPDR Dow Jones Industrial Average (DIA)) may want to consider buying gold as a hedge for these positions because the fundamentals are still very strong for gold.

With gold physical inventories available for delivery at such low levels, and entities actively trying to push the prices lower without the ability to back up their trades, gold still offers investors terrific potential. At this point, even the traditional investment crowd may take a keen interest in calling the bluff of some of these shorts especially as the investments like SPY are close to all-time highs.

We believe in the near future investors will look back and wonder why they didn't see the gold price rise coming, but all the signs are in place and it is simply a matter of patience.

http://seekingalpha.com/article/1742362-weekly-comex-gold-inventories-huge-friday-sell-order-equivalent-to-70-of-gold-registered-for-delivery?source=yahoo


My comment: Interesting months ahead for gold.