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Short covering pushed precious metals higher - TDS

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 17, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    Research Team at TDS, presents the CFTC commitment of traders report for the week ending February 9th, 2015.

    Key Quotes

    “Precious metals gained momentum as rates fell lower, equity markets wobbled, and recession risks have the markets pondering the end to Fed rate hikes for now— specs in gold/silver were forced to cover shorts (over 20% of the short interest for silver), and as prices break through the 200dma long bets are accumulating too (silver longs just shy of all-time highs once again).

    Platinum investors aggressively covered their short exposure and took out new long positions, which boosted their net longs a very large 10.4% of open interest. Specs were pushed into bullish mode, as precious metals sentiment improved along with a jump in gold prices, dropping rates and a less robust USD.

    Markets now are starting to believe that the projected primary deficits will not be easily covered by above ground stock at a time there is more precious metals appetite on the investment side, which should tighten markets and lift prices. This is what prompted TD to recommend a long Pt positions two weeks ago.”
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