by Avi Gilburt
Gold Seek
As a student of market history, I always find it interesting, and even sometimes quite comical, how certain fallacies about markets are continually propagated by investors and analysts alike. Throughout my career in writing about metals, I have tried to bring many of these to light, and explain why so many of the fallacies should be ignored.
The latest in the string of fallacies relates to the Commitment of Traders report (COT). The common argument suggests that as long as the commercial traders are shorting gold heavily, then gold cannot rally. And, much has been made of late regarding the heavy commercial short positions pointing to a major drop in the gold market. Yet, history suggests otherwise.