Gold: traders broke through the June "bottom" of the net position

The Commodity Futures Trading Commission (CFTC) COT (Commitments of Traders) reports for the week ending on Tuesday last week showed:

Non-commercial large speculators decreased their net buying position in gold by 21.9k contracts, bringing it down to 143k. This marks the third consecutive week that these large speculative players have reduced their net buying position. The current net position is now lower than it was at the end of June, and is the lowest it has been since March 14.

Hedger operators have decreased their net sell position on gold contracts for the third consecutive week, this time by 19.3k contracts, bringing the total to 167.6k.

The number of open contracts decreased by 11.6 thousand, bringing the total to 427.8 thousand.

The ratio of the number of buy contracts to the number of sell contracts for the bullish index of large speculators decreased by 0.56 over the week, bringing it to 2.67.

The latest Gold COT data shows bearish sentiment among traders. In the last week, the net position decreased as prices rose, falling below the levels of the end of June and becoming the lowest in almost 5 months. Large funds increased their sales by 16%, while purchases were also reduced. If this trend continues, it could lead to lower prices for gold.

COT report data is essential for medium and long-term trading, and is mainly used by large speculators, NON-COMMERCIAL (banks, investment funds). These traders usually follow the trend (blue line). Small speculators, NONREPORTABLE POSITIONS, however, have little influence on the market (red line). Hedgers, COMMERCIAL (operators, large companies) usually go against the trend (black line). The net position is the difference between the number of buy and sell contracts, while open interest is the total of all open positions in the market.