by Peter Degraaf
Market Oracle
For years the best trading strategy in gold and silver has been to buy when the ‘net short’ position of commercial traders was low, and sell when the numbers were high.
[…] This chart courtesy Cotpricecharts.com shows commercial gold traders are ‘net short’ (purple bars) 207,000 contracts in the futures market. Last week the number was 208,000 and this was the largest number since December 2012. If we compare this chart to the gold chart just below this chart, we will see that in the past there was almost always a correlation between a large increase in the ‘net short’ position in the COT chart, and a top in the price of gold.