LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

Look Which Precious Metal Is Beating Warren Buffett…
By: Frank Holmes, US Funds

How I Know If I Am Wrong About The Equity Market
By: Avi Gilburt, Elliott Wave Trader

Precious Metals Update Video: Was the rally in metals enough?
By: Ira Epstein

Asian Metals Market Update: September-17-2019
By: Chintan Karnani, Insignia Consultants

JPMorgan’s Top Metals Trader in the Crosshairs for Illegal Manipulation
By: Clint Siegner

SWOT Analysis: The U.K.’s Royal Mint Is Planning Its Own Gold ETF
By: Frank Holmes, US Funds

Why are Bonds Going for Broke?
By: David Haggith

Iran Attack Poses First Serious Test for Trump
By: Rick Ackerman, Rick's Picks

GoldSeek Radio: CEO Ken Lewis, Andrew Magure and CEO Tom Coughlin
By: Chris Waltzek, GoldSeek Radio

Precious Metals Update Video: Silver slipping away, trade got crowded
By: Ira Epstein

 
Search

GoldSeek Web

 
Last Week Was Just A Taste Of The Coming Gold Short Squeeze


By: John Rubino



 -- Published: Sunday, 14 October 2018 | Print  | Disqus 

The gold and silver futures markets got even more unbalanced last week, with speculators (who are usually wrong at the extremes) going as short as they’ve ever been and commercials going even more long.

Gold COT gold short squeeze

Silver COT gold short squeeze

Here’s the gold data in chart form:

Gold COT chart gold short squeeze

These are historically huge imbalances that – if the action in the paper markets still has predictive value – point to a gold short squeeze in which the speculators who are now betting that precious metals will fall are forced to cover those positions by buying, in the process sending the price up dramatically.

On Thursday we got a sense of what that might look like. Stock markets around the world sold off, which sent capital scurrying for cover. Some of that capital flowed into gold, which chased futures speculators out of some of their shorts. The result was a nice pop in gold:

Gold Price gold short squeeze

But this barely dented speculator short positions, as we’ll discover next Friday when the COT report covering Thursday’s action is released. So the real gold short squeeze is still to come.

Risk-Off, Everywhere

The other interesting thing about last week was that stocks, bonds and cryptos all fell while gold and silver were rising.

Gold versus other assets gold short squeeze

These aren’t especially notable moves, and can be reversed out in a single big “risk-on” trading day. But again, they’re a taste of what’s coming when it finally dawns on investors that every major asset but gold is overvalued and therefore prone to correct if not crash. Even instruments previously thought to be safe havens like government bonds and cryptocurrencies have become bubbles destined to pop.

Gold is the only thing that’s hasn’t been bid up to bubble territory in the past few years, which makes it cheap and therefore relatively safe. Combine this undervaluation with the even more important fact that precious metals have historically been THE safe haven in times of financial and geopolitical stress, and there’s a real possibility of global capital not just trickling but pouring into this tiny market. That gold short squeeze will be one for the history books.

 


| Digg This Article
 -- Published: Sunday, 14 October 2018 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus







 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.