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Gold($US) COT

 

The top section of this chart is simply a weekly gold price. The middle section takes a look at the Commerical Open Interest (COI) in the futures market and divides the Net Short position by the total Commerical Open Interest (COI) which is represented in the bottom section. When the Net Commerical Short position represents less than 30%, this typically represents a lower risk entry point into the gold market. The gold market tends to be a riskier proposition when the Net Commerical Short position represents 55% plus of the total COI. It must be said that this is also the region where the gold price has its biggest moves as the other side of these short positions (long side) is held by speculators whose buying fuels large rises (Red circled areas). In addition we analyse the performance of gold shares to help us determine the points in time where the gold price looks increasingly vulnerable. See the Gold/XAU and Gold/API ratio charts for further information. For an additional explanation of the COT chart see the following article: The Physical Market Sets the Price.

 

 
   
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