Silver About to Reverse in Price

According to the COT report for silver, the open interest in silver came down dramatically this week:
http://katchum.blogspot.be/2013/05/cot-report-goldsilver.html

That means the silver price is likely to reverse to the upside. Also, commercial shorts have almost all been covered now.

According to the COMEX report for silver, J.P. Morgan doubled its registered inventories from eligible silver, meaning that total silver stock is likely to go down. This confirms the COT report's drop in open interest.
http://katchum.blogspot.be/2013/04/gold-and-silver-comex-stock.html

Read More

COT Report Gold/Silver

This page is created to monitor the COT report for gold and silver

Whenever the commercials turn long (purple bars go up), the price will bottom out and vice versa.

Open interest (green line) indicates the direction of the price:

   - When the price declines and the open interest increases: the silver price will keep falling.

   - When the price rises and the open interest increases: the silver price will keep increasing.

   - When the price declines and the open interest decreases: the silver price will reverse to the upside. 

   - When the price rises and the open interest decreases: the silver price will reverse to the downside.

Chart 1: COT Gold

Chart 2: COT Silver

Open Interest explained here by BrotherJohnF:

Read More

Copper Contango Theory: Copper Bottoming Out?

It looks like the contango is steepening again, so that means that the price will likely go down. But the red chart seems to be topping out while the copper price seems to bottom out...

Chart 1: Copper Contango Vs. Copper Price

The COT report though is very bullish, so copper could go up in the future.

Chart 2: COT report Copper

Although the technicals are bullish, the fundamentals are very bearish. First we have the Chinese GDP below estimates. We have IMF GDP growth revisions to the downside. Record stock levels for copper. Stock markets on the verge of collapse.

We have a lot of contradictory indicators.

Read More

Nice Site to get Current COT Reports

I always thought by myself, how come the COT site doesn't give current charts and current tables here. I mean, those numbers are 2 months old... Because of that, I didn't have current information. But we have a breakthrough here.

Thanks to Dieuwer from Seekingalpha, who pointed out I make a lot of mistakes, I now have a very interesting site to share. Namely: http://www.cotpricecharts.com/commitmentscurrent/

On that site, the two most important ones for me are the one for silver/gold and the other for 10 year bonds.

Gold: http://snalaska.com/cot/current/charts/GC.png
Silver: http://snalaska.com/cot/current/charts/SI.png
10 year bonds: http://snalaska.com/cot/current/charts/TY.png

Let's talk about the silver one first. Chart 1 gives us immediately the commercial interest. And we see that today the commercials are pretty short silver. That means that silver will be weak at this time.

Once the commercials start to become long again (purple chart goes up), like in July of 2012, then you need to start buying silver. And indeed, when you look at the silver price in July 2012, it bottomed out. So this COT site, is a must, to monitor each week.

Chart 1: Silver Open Interest

Chart 2: Silver price

As for the 10 year bonds, Chart 3 gives us an idea what the commercials are doing now. They have gone long just recently. You can see the purple chart has gone positive the previous week. How to read this chart? When the purple chart is very positive, with many commercials buying bonds, like in April 2012, then you should buy bonds. When commercials are short, like in October-December 2012, you should sell bonds.
And it works like candy...

Chart 3: 10 Year Treasuries Open Interest

Chart 4: 10 Year Treasury Yields

It's like Dieuwer has just put money in my pocket with these charts!

Read More