Saturday, July 14, 2012

COMEX Swap Dealers Net Long Gold for Third Time Ever

HOUSTON --  For only the third time in the six years of Commodity Futures Trading Commission (CFTC) disaggregated trader data, commercial futures traders the CFTC classes as Swap Dealers reported a net long position in gold futures on the COMEX bourse in New York.

Source:  CFTC for COT data, Cash Market for gold.  Chart covers the entire disaggregated COT dataset for Swap Dealer gold futures net positions excluding spreading contracts.  A 2-year chart is shown below.   


Swap Dealers are commercial derivatives traders who primarily trade in the form of swaps in other markets and then hedge those sophisticated positions using futures contracts.

The CFTC requires all large traders to report their open positions as of the close on Tuesday each week and then releases that Commitments of Traders (COT) data to the public, usually the following Friday.

As of Tuesday, July 10, as gold closed on the Cash Market in New York at $1,567.16, Swap Dealer commercial traders reported holding 54,038 gold contracts long and 53,239 short for a combined net long position of 799 lots according to  data released by the CFTC on July 13.


Seven reporting weeks ago, on May 22, the normally net short Swap Dealers edged briefly into long territory, reporting 82 COMEX 100-ounce contracts net long then, with gold near $1,568. 
The only other time the Swap Dealer commercial traders reported a net long position in gold futures occurred last year for four weeks in October, shortly after gold hit an all time nominal high near $1,923 an ounce but had corrected violently more than 13%.  The high net long position occurred on October 18, 2011, when the Swap Dealers reported a net long gold futures position of 8,731 lots – with gold then near $1,657.  – Gene Arensberg (Got Gold Report)


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Trading gold, silver and mining shares since 1980 with a focus on taking advantage of volatility extremes, Gene Arensberg analyses the markets through a basket of technical and fundamental indicators and shares his findings from time to time here at Got Gold Report. Mr. Arensberg has been quoted in the Wall Street Journal, Dow Jones MarketWatch, USA Today and dozens of other news organizations.

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