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Funds Hold Pat On Gold, Trim Net Short In Silver

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(Kitco News) - Large speculators’ net positioning did not change much in gold futures but the net bearish position in silver was scaled back according to the latest data gathered by the Commodity Futures Trading Commission.

During the week-long period through March 6 that was covered by the report, Comex April gold rose $16.60 to $1,335.20 an ounce. May silver rose 35 cents to $16.784.

Net long or short positioning in the CFTC data reflect the difference between the total number of bullish (long) and bearish (short) contracts. Traders monitor the data to gauge the general mood of speculators, although excessively high or low numbers are viewed by many as signs of overbought or oversold markets that may be ripe for price corrections.

The commission issues two reports each Friday -- a so-called “legacy” report and a “disaggregated” report, started in 2009 and meant to offer more detail.

“ETF [exchange-traded-fund] investors sold hardly any gold last week, however, and speculative financial investors also left their positions unchanged…,” said a research note from Commerzbank.

The disaggregated report shows that money managers’ net-long position in gold stood at 150,706 lots, compared to 150,019 the prior week. Traders were exiting from both sides of the market. However, the data suggest that the short covering (decline of 5,670 short positions) outpaced the long liquidation (decline of 4,983 longs).

Phil Flynn, senior market analyst with at Price Futures Group, commented that the data suggest there hasn’t been a massive flight to safety into gold despite recent turmoil in equity markets.

“We’re seeing a little bit of a wait-and-see [attitude] on gold,” he said.

Meanwhile, in silver futures, money managers’ net-short position now stands at 11,078 contracts, compared to a record 16,435 lots the previous week. The most notable feature in the data was fresh buying, as reflected by an increase of 4,389 gross longs. There was also some short covering, as total short positions fell by 968.

This metal may have been helped by reduced worries about a global trade war on signs that the administration of U.S. President Donald Trump will grant some kind of exemptions to certain key nations on steel and aluminum tariffs, Flynn said.

“Because of that, there is more interest in silver because of the industrial side,” he said.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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