An Amazing CoT and BPR for Gold

141
Mon, Jul 8, 2013 - 4:57pm

Released just this afternoon, the July Bank Participation Report and the latest Commitment of Traders Report are so interesting that I felt they justified this new post.

So, let's dive right in. I'm not going to spend much time talking about silver because the data is somewhat skewed this week by the expiration of the July13 contract. The Large Specs added 3800 net long and the Commercials added 3700 net short, all due to expiration and rollovers and now we see why silver outperformed gold by such a wide margin last week.

The reports for gold, on the other hand, are astonishing. Let's start with the CoT. For the reporting week, price fell by $32 while total OI rose by 19,752 contracts. Check out these internals:

Large Specs dumped another 6,200 longs and added 7,200 additional shorts. This brings their net position down to just 20,700 contracts and drops their total net long ratio down to a preposterously low 1.15:1. Again, for perspective, shortly after QE∞ was announced last fall, the gold Large Specs were net long over 210,000 contracts. This means that, in the time since, they've been coerced into dropping their long exposure by over 90%.

On the all-important flip side, The Gold Cartel added another 21,427 new longs last week through the Tuesday cutoff. Because they also added 8,995 new shorts, their net short position only declined by over 12,000 contracts. However...and here comes the amazing part...their new net short position is just 22,776 contracts, roughly 70 metric tonnes of paper gold, and their updated net short ratio is also preposterously low at 1.12:1.

Remember, this entire "event" from the announcement of QE∞ last fall to today, has been staged in order to give The Bullion Banks the time and the ability to cover their massive paper short position. When QE∞ was announced in September of last year, the total Cartel net short position was 737 metric tonnes of paper gold. As of last Tuesday, they are now net short just 70 metric tonnes. That's an incredible and amazing drop of over 90%.

Now get this, the CoT survey was taken last Tuesday. On Wednesday and Friday of last week, the total dollar move in gold was down another $32. Over those two days, the total open interest n gold rose by 18,561 contracts. It recent form follows, then it is safe to conclude that the vast majority of this new OI was contract initiation on the short side by the Large Specs. If that's the case, then we headed into last weekend with a total Gold Cartel net short position as low as 5,000 contracts. TOTAL!! And now you see why I find this so incredible and amazing.

Next let's consider this month's Bank Participation Report. This aggregated report gives us a once-a-month look at the gross positions of those traders classified as banks, both U.S. and non-U.S. Now check this out...let's start with the report from last October so that you can see from another perspective just how steep the changes have been in the nine months since.

GROSS LONG GROSS SHORT

U.S. Banks 40,625 146,809

Non U.S. Banks 34,881 113,445

TOTAL 75,506 248,254

And now here are the numbers from last month (June). Note that the banks had moved from net short position of 172,748 to a small net long position of 4,582. This got everyone's attention and was well summarized here: https://jessescrossroadscafe.blogspot.com/2013/06/cftc-gold-and-silver-bank-participation.html

GROSS LONG GROSS SHORT

U.S. Banks 56,751 27,129

Non U.S. Banks 24,035 49,075

TOTAL 80,786 76,204

Well, we've all been waiting with baited breath for the July report and it just came in a few minutes ago. Would the banks continue to cover on these falling prices or were they adding to the downside momentum? We got our answer:

GROSS LONG GROSS SHORT

U.S. Banks 69,565 24,939

Non U.S. Banks 34,904 58,565

TOTAL 104,560 83,859

The total net long position grew by over 16,000 contracts to an astounding 20,701. But drill a little deeper...The U.S. banks actually added net longs of 15,000! The only thing holding the overall net position in check was the 9,500 new shorts put on by non U.S. banks (HSBC? Scotia? Barclays? UBS?) Do you think that The Fed warns, plans and advises the non-U.S. banks as clearly and succinctly as they do the U.S. banks?? The Fed IS the U.S. Banks. If Barclays or UBS is too stupid to see what's going on and they are actually adding shorts at these prices, well Hells Bells, go right ahead! Their selling simply allows the U.S. Banks to cover even more!

Look, I know these past nine months have been brutal and we've all suffered through the almost-daily pain of continued losses. But this is almost over! Yes, prices may continue lower, stopping and turning who knows where. However, I am 100% confident in my analysis of The Big Picture here. The major, too-big-to-fail, Fed-Primary-Dealer and Bullion Banks have now fully gotten themselves out from under what had been an extraordinarily wrong-footed net short position of over 146,000 contracts last autumn. They are now net long nearly 45,000 contracts! (And certainly more than that after last Wednesday and Friday.) That flip of 191,000 contracts took place while price declined by 30% from $1800 to $1250 and represents a change of position equaling over 595 metric tonnes.

Please, I beg you, remain patient and continue to stack physical metal. You will soon be rewarded with a rally that will surprise even the most ardent of bulls.

TF

https://news.goldseek.com/COT/1373312054.php

https://www.cftc.gov/dea/bank/DeaJuly13f.htm

About the Author

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turd [at] tfmetalsreport [dot] com ()

  141 Comments

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SamSchleppsMotley Fool
Jul 10, 2013 - 8:07pm

@Motley

Serious questions back - not a fair exchange.

To answer your question, I would guess we really see very little and that is what is intended, but we also have laws (yes maybe drafted by those who want to get around) and many many participants of all sizes - if governments represent 30 K tonnes then somebody also represents the remainder of 130+K tonnes. Would not all those collective participants and the two sides to every trade be very difficult to hide information from? So price would be accurate but for manipulation - which we can see at some level. Not trying to adopt an EMH here, but seems to be in play - the deception must end somewhere and it seems you saying no-one other than the evil cabal can arbitrage that.

My question - within that groups of participants would the the receivers of gold in the gold-oil contracts. Would they not ultimately believe in the ultimate arbiter of the market to get to the right price - ie up toward the 50,000 per oz mark? What would be the point of the contract then or did the USA know they just weren't going to deliver on there end? I recognize time plays a role. I would think they would also have something in the contracts as a offset to such manipulation.

SilverSurfers
Jul 10, 2013 - 3:02pm

Brainwave

So, the two boys watch the Lord of Rings, and there was this character called Gollum.

Lord of the Rings (HD) - Gollum / Smeagol talks to his reflection in river

Gollum was a true schizophrenic. He had two completely personalities, one of greed and the other of charity, the inherent duality of man. But that was his problem. It was that these two personalities appeared in staggered time exclusivity, two flip flops switching, one was on while the other was off. His brain has two separate and distinct wire nests, though both were connected to a common fact box. This brain was switched between these two personalities, and that is what characterized him as sick, crazy, that is schizophrenic, and the author attempts to portray man as such.

In the case at bar, we have silly putty, with 5 intellectual skills and 2 psychological traits, Patent Lawyer, Electronic Engineer, Bullion Analyst, Political Candidate, Military Commander, Alpha Werewolf, and Reasoning Spiritualist, all seven associating concurrently and capable of spewing out seven different parlance languages, ostensibly talking in tonques to the uninformed.

There is reason why an incompetent clinic chick would have no clue. "He thinks he is running for president", though no google search was done and the important question was never asked "What do you think are your chances of Winning".

The Pink Panther-Inspector Clouseau

Then the Psychologist takes over, and its right out of the 1960s laugh in, Very Interesting, would you like some medication, which was actually pretty stupid, as drugs are not taken at all, and this so called doctor also had no clue. A Writ of Mandamus was necessary, as the police state worked its processing.

Very Interesting But Also Stupid

Sick minds can not be judged by what is said, but by an inability to switch personalities at will. There is the clue. If one can turned it on and off at will, odds are one is not crazy, even if called repeatedly so by the uniformed.

Back to earth, we should be so lucky JPM tries to corner the silver market.

Mantis
Jul 10, 2013 - 11:24am

jp morgan

sounds like jp morgan are trying to corner the silver market. Are they the new hunt bros or something ?

ps go the pommies !!!

Just A Regular Guy
Jul 10, 2013 - 10:40am

Are These Guys Serious?

https://www.bloomberg.com/news/2013-07-10/gold-oil-ratio-declines-to-lowest-since-2008-chart-of-the-day.html

I thought there was a recovery???

https://www.bloomberg.com/news/2013-07-10/reits-deepening-bond-losses-as-leverage-forces-sales.html

There was also an article earlier I saw about how the strong USD is hurting exports.... lol, and on the eve of FOMC minutes being released and Bernanke speaking.... O RLY?

In other news some hoople-head jammed his Pergot in the gate of the US Embassy in Australia. With all the rozzers and other emergency personnel it's a great way to move people in and out of the embassy if the premises is being watched. Just a crazy thought.

https://www.smh.com.au/act-news/bomb-squad-sent-to-us-embassy-after-car-crashes-into-gates-20130710-2pqb8.html

Should be an interesting night here in Aussie land (i.e. day in yankie land).

Peace

P.S. Go the Aussie in the Ashes!!! WOOOOWOWOWOWOWOOOO

SilverSurfers
Jul 10, 2013 - 10:32am

Meh

last night there were 18,900 reprints of my writings, today 66,900. I hope turdville can take all the eyeballing. YIKES!!!!

Eagles - Witchy Woman ( 1972 )

https://totalcontrol.blogtownhall.com/2013/07/10/usa_fed_bank_is_followi...

JPMoargan
Jul 10, 2013 - 10:24am

Actually, Ted's been talking about this quite a bit

He addressed it again this weekend. You should become a subscriber. https://www.butlerresearch.com

"Sometimes, however, enough detail is provided to engage in some meaningful analysis. I believe the statistics from the first six days of the July COMEX silver futures contract provide enough data for attention. The standout feature for the first week of deliveries against the July silver contract indicates that JPMorgan has taken roughly 90% of the metal offered for delivery, or a total of 1637 contracts out of a cumulative total of 1828 delivered so far. In turn, of the silver contracts stopped or accepted by JPMorgan, 90% (1479 contracts) were for JPMorgan’s own house or proprietary trading account. In other words, JPMorgan took delivery of roughly 7.4 million ounces of silver in the COMEX warehouses for their own benefit and risk."

It caught Andrew's attention in his weekly Commentary, too. It's definitely on the radar.

RightLeftWrongJimymac
Jul 10, 2013 - 9:18am

800+

JMac,

Maybe 800+, I did not count them and did not hear anyone give an official count. I snapped a picture of the room from the back during a break - don't want to post it because I want to respect the privacy of the people in attendance and some might not want their picture online.

RLW

hai
Jul 10, 2013 - 9:11am

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SilverSurfers
Jul 10, 2013 - 7:27am

Odd?

I find it rather odd that almost every night recently JPM House stands for delivery of a large number of silver contracts, but no one on this board (including Turd) or any other commentator like Ted Butler, Harvey Organ, Jeff Nielson, Bill Murphy, etc. has any comment on it.

On top of that, there is no resulting change in JPM's Registered silver balance at the Comex resulting from it.

====

JPM first went long gold as they raided GLD through Melon.

Yours indicated to watch for JPM going long Silver and raiding SLV.

Gold and silver prices and unemployment rate | TF Metals Report Jun 7, 2013 ... Submitted by Mad5Hatter on June 7, 2013 - 11:51am. .... keeping up the OI in silver (near all-time highs), while gold OI is dropping like a fly on Raid. ... Since JPM is custodian of SLV, and the prospectus allows the custodian to ... www.tfmetalsreport.com/comment/204621

Gave JPM until end of june to go long silver.

Gold, Silver and The Fed | TF Metals Report Jun 19, 2013 ... Submitted by Just A Regular Guy on June 20, 2013 - 6:53am. .... Submitted by Mad5Hatter on June 20, 2013 - 7:24am. .... has been made public and Snake and Medusa have been given until this weekend to go long silver, or silver platter jail time, whatever, ... JPM as indicated did go long last week in gold. www.tfmetalsreport.com/comment/207655

Many years ago, 2006, I gave the FED the script.

https://totalcontrol.blogtownhall.com/2009/03/14/anglos_rule_the_bi-curr...

In the event of an intentional or unintentional collapse of fiat moneys, the USA and her Anglo sisters would certainly survive a global fiat collapse better than most. While wars are often used to place an aggressor nation above others in power, control, influence, and wealth, the current progress of human cultural evolution is to avoid wars were possible and cooperate together for the common good. It seems then, that an alternative to war has been found, this time around, as the Anglo world could do the same by placing itself as the financial rulers of the world in a globalized world economy, in a war free global community, without firing a shot, by simply collapsing the FRN through uncontrolled fiat money printing while retaining backup real gold and silver coinage sustained production.

===

turd is more into Gold than silver, guessing his closets are not that big. LMAO!!

The clue, in case you missed it, yeah, I know its very very subtle, it that BIG YELLAR he wears. LMAO!!

NonoverlappingMagicCereal
Jul 10, 2013 - 6:57am

@unfashtandich

My comments were more directed at TF,s willingness to call for higher metals prices even though it,s been delayed and derailed so many times.

I agree that it is admirable to keep things in perspective, to maintain a handle on the big picture even if day-to-day happenings are in conflict with it, however....

It doesn't take conviction to see the macroeconomic state of the world............just observation, and a little common sense.

....this illustrates perfectly well that it is a deep seated conviction. Almost nothing about the global economy can be accurately predicted with "just a little common sense". If you are convinced otherwise, it is at your own peril.

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