Mover Mike

The Gold COT report released this afternoon revealed the following:

*The large specs reduced their longs by a sizeable 23,447 contracts and increased shorts by 1,502 contracts. The Commercials increased longs by 6,751 contracts and reduced shorts by 12,664 contracts, also a big switch. The little specs increased longs by 2,259 contracts and reduced shorts by 3,275 contracts.

... more and more of the major trade gold shorts are quietly doing what they can do to extricate themselves from their positions.

If you are a bullion bank, your job in the second phase of this gold bull market is to remain calm, move from the massive short positions to long, seek to minimize the bull market enthusiasm, and encourage the little guy to get short until he realizes he is screwed. If I were a client of the CPM group, I would ask, "Who are you working for, Goldman Sachs or me?"

That's why the price of gold has gone up more that real estate since 2001. There is a massive short of 12,000 to 16,000 tons and it is not available at these modest gold prices. There are also many other reasons. To site just one, gold is now money and is outperforming most other currencies, and we just told the world that the USDs you hold are not good for "Buying American"!