Today
King World News is reporting on an absolutely stunning development,
this time in the silver market. Acclaimed commodity trader Dan Norcini
told KWN that in the silver market, “... the hedge fund outright short
position is the largest position that I’ve got on my records going back
to the beginning of 2007. We’re talking about a five and a half year
period.”
Norcini
also noted there would be a huge move in silver, “if they (hedge funds
shorts) get caught on the wrong side of that market ... because all of
those shorts are going to head to the exits at the same time.”
The
acclaimed trader also discussed hegde fund problems in the gold market,
but first, Bill Haynes, President of CMI Gold & Silver, had this to
say about QE: “Eric, it’s guaranteed, it’s just a question of
when. Probably within a few weeks. Subastian Mallaby, a contributing
editor to the Financial Times and a member of the Council on Foreign
Relations, in Wednesday’s Financial Times, chided Bernanke and the Fed
for not showing some audacity, some aggressiveness in attacking the
problem of an economy that will not get going.”
Bill Haynes continues:
“Mallaby congratulated
Bernanke for his massive money creation in 2008, and said the market
needs more of the same. But Mallaby criticized Bernanke for buying only
Treasury bills today, noting that in 2008/2009 the Fed bought ‘toxic
securities.’ He also said that the Fed backstopped the money market
funds. It was an aggressive move. It was the type of thing they
expected the Fed to do, but that’s not what’s going on now.
Dan Norcini noted this stunning development in the silver market: “One
of the things I’ve noted here is the hedge fund outright short
positions, we’re just talking about the number of outright short
positions that the hedge funds have in the silver market, it is the
largest position that I’ve got on my records going back to the beginning
of 2007.
We’re talking about a five
and a half year period. What this shows you is that the hedge funds
have been making some pretty decent size bets on the short side of
silver. And, again, if they get caught on the wrong side of that
market, and all of the sudden you get a round of QE coming, you are
going to have an awful lot of potential for some (big) buying in (that
market) because all of those shorts are going to head to the exits at
the same time.
(This will also) bring in
some new money on the long side of the market. If that’s the case,
you’ll see upside resistance levels on silver get violated very quickly
(because of the short squeeze).”
Norcini had this to say about hedge fund problems in the gold market:
“The hedge fund community, which is the driver of markets in today’s
trading environment, hedge funds move these markets, it’s just that
simple, and those guys had been betting against gold. They had their
smallest net long position going all the way back to the middle of
December of 2008. We are talking about a three and a half year period
here, Eric.
Many of them were playing
gold from the short side of the market, looking for a breakdown. What
happened was Draghi caught all of them off guard. These short positions
that were trying to push this market down, into what was considered
Asian buying below the market, those shorts had nowhere to go when
Draghi came out with his comments, so out they went.
Their buying took it up
through $1,600. What the COT report is showing us is that the swap
dealers, again, those strong hands we had been mentioning the last two
weeks, they continue to build a net long position in the gold market.
The swap dealers are net longs, the hedge funds had a small net long
position after putting on some fresh shorts, the commercials, the big
bullion banks, had a relatively small net short position by (historical)
comparison.
So all of the ingredients
are in place if you get an upside violation of any technical resistance
level. You’ve got a lot of potential (upside) movement as these guys
decide to come back into this gold market. In other words, there is a
type of vacuum (to the upside) that could be filled if big money starts
committing to gold in a hurry again.
沒有留言:
發佈留言