Gold Futures Sentiment: Updated Data Through: December 01 2020
Large precious metals speculators increased their bullish net positions in the Gold futures markets this week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday.
The non-commercial futures contracts of Gold futures, traded by large speculators and hedge funds, totaled a net position of 260,314 contracts in the data reported through December 01 2020. This was a weekly gain of 16,412 net contracts from the previous week which had a total of 243,902 net contracts.
The week’s net position was the result of the gross bullish position (longs) going up by 4,020 contracts (to a weekly total of 324,344 contracts) while the gross bearish position (shorts) fell by -12,392 contracts for the week (to a total of 64,030 contracts).
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Gold speculators sharply boosted their bets this week for the second time in the past three weeks. The increase marked the largest one-week rise in the past nine weeks and pushed the bullish position to the highest level in nineteen weeks, dating back to July 21st. The gold speculator level has now been in a continuous bullish position for one hundred and seven weeks, starting back on November 20th of 2018.
The large speculators Strength Index level, the current score for traders compared to levels of the past three years, shows that specs are currently at a Bullish level with a score of 76.2 percent.
Speculators are seen as trend followers and usually trade in tandem with the price direction (blue line in above chart). At the extreme levels, specs are very important to watch as they have a tendency to bet the wrong way (that the trend will continue to even more extreme levels).
| TRADER TYPE DATA: | SPECULATORS |
| – Percent of Open Interest Longs: | 60.3 |
| – Percent of Open Interest Shorts: | 11.9 |
| – Net Position: | 260,314 |
| – Gross Longs: | 324,344 |
| – Gross Shorts: | 64,030 |
| – Long to Short Ratio: | 5.1 to 1 |
| NET POSITION TREND: | |
| – COT Index Score (3 Year Range Pct): | 76.2 |
| – COT Index Reading (3 Year Range): | Bullish |
| NET POSITION MOVEMENT INDEX: | |
| – 6-Week Change in Strength Index: | 2.7 |
The commercial traders position this week came in at a total net position of -293,263 contracts. This was a weekly change of -8,434 contracts from the total net of -284,829 contracts reported the previous week.
The commercials Strength Index level, a score that measures the contract levels of the past three years within a range of 0 to 100, shows that Commercials are currently at a Bearish level with a score of 22.4 percent.
At the extreme levels, commercials are very important to watch as they have a tendency to be correct at the major turning points in price trends.
| TRADER TYPE DATA: | COMMERCIALS |
| – Percent of Open Interest Longs: | 20.5 |
| – Percent of Open Interest Shorts: | 75.0 |
| – Net Position: | -293,263 |
| – Gross Longs: | 110,108 |
| – Gross Shorts: | 403,371 |
| – Long to Short Ratio: | 0.3 to 1 |
| NET POSITION TREND: | |
| – COT Index Score (3 Year Range Pct): | 22.4 |
| – COT Index Reading (3 Year Range): | Bearish |
| NET POSITION MOVEMENT INDEX: | |
| – 6-Week Change in Strength Index: | 0.2 |
The small traders position this week totaled a net position of 32,949 contracts. This was a weekly change of -7,978 contracts from the total net of 40,927 contracts reported the previous week.
The small traders Strength Index level shows that smalls are currently at a Bullish level with a score of 63.6 percent.
Small traders are less important to watch (in most cases) as their numbers tend to be just a small part of the total trading open interest.
| TRADER TYPE DATA: | SMALL TRADERS |
| – Percent of Open Interest Longs: | 10.3 |
| – Percent of Open Interest Shorts: | 4.2 |
| – Net Position: | 32,949 |
| – Gross Longs: | 55,439 |
| – Gross Shorts: | 22,490 |
| – Long to Short Ratio: | 2.5 to 1 |
| NET POSITION TREND: | |
| – COT Index Score (3 Year Range Pct): | 63.6 |
| – COT Index Reading (3 Year Range): | Bullish |
| NET POSITION MOVEMENT INDEX: | |
| – 6-Week Change in Strength Index: | -28.3 |
*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) as well as the commercial traders (hedgers & traders for business purposes) were positioned in the futures markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators). Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).
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