In this week’s ‘Days to Cover’ chart, the Big 4 traders are short about 89 days of world silver production, down 15 days from last week’s COT Report. The ‘5 through 8’ large traders are short an additional 50 days of world silver production, unchanged from last Friday’s report, for a total of about 139 days that the Big 8 are short — and obviously down 15 days from last week’s COT Report.
[Note: As you know, there’s one Managed Money trader in each of the Big 4 and Big ‘5 through 8’ categories. This fact distorts the numbers you see below, and the distortions in silver are now so great, that I’m not going to bother doing much in the way of calculations…just approximations.]
That 139 days that the Big 8 traders are short, represents a bit over four and a half months of world silver production, or 299.1 million troy ounces/59,820 COMEX contracts of paper silver held short by these eight traders…two of which are Managed Money traders.
After subtracting out the positions of the two Managed Money traders…about 17,000 COMEX contracts…the true Big 8 commercial short position is 59.8-17.0=42,800 contracts/214 million troy ounces approximately.
Converting that number to days of world silver production produced a radically different number…about 100 days of world silver production for the Big 8.
This is monstrously lower than the 139 days shows in Nick’s graph further up — and for that reason in silver, it’s red and green bars can be disregarded. That can be said of the green and red bars for gold as well — and the same for platinum, palladium and copper, plus others most likely.
That’s why I said that Nick’s ‘Days to Cover’ chart should be viewed for its ‘entertainment value’ only.
As for Ted’s raptors in silver, the 27-odd small commercial traders other than the Big 8, he says their long the COMEX futures market in silver is around 34,000 contracts/170 million troy ounces…down about 33 million from last week, as they sold about 6,500 long contracts during this past reporting week.
The Big 8 traders are short 43.9 percent of the entire open interest in silver in the COMEX futures market, which is down a bit from the 44.9 percent they were short in the last COT report. And once whatever market-neutral spread trades are subtracted out, that percentage would be around the 50 percent mark. In gold, it’s 38.9 percent of the total COMEX open interest that the Big 8 are short, up a bit from the 35.8 percent they were short in last Friday’s COT Report — and around the 45 percent mark once their market-neutral spread trades are subtracted out.
But remember that the Big 8 shorts in both gold and silver have two Managed Money traders in their midst, so these are not pure numbers — and are actually far less than stated above.
In gold, the Big 4 are short 36 days of world gold production, up 2 days from last Friday’s COT Report. The ‘5 through 8’ are short 24 days of world production, unchanged from last week — and the week before…for a total of 60 days of world gold production held short by the Big 8 — and obviously up 2 days from last Friday’s COT Report. Based on these numbers, the Big 4 in gold hold about 60 percent of the total short position held by the Big 8…up about 1 percentage point from last Friday’s COT Report.
And because of the presence of two Managed Money traders…one in the Big 4 — and the other in the Big ‘5 through 8’ category, these numbers are overstated as well. Like in silver, the actual numbers are much smaller.
The “concentrated short position within a concentrated short position” in silver, platinum and palladium held by the Big 4 commercial traders are about 64, 74 and 62 percent respectively of the short positions held by the Big 8…the red and green bars on the above chart. Silver is down about 4 percentage points from last week…platinum is up about 2 percentage point from a week ago. Palladium is up about 1 percentage point week-over-week.
The above numbers are not quite accurate because of the involvement of the Managed Money traders in all four by now…but close enough for our purposes in these particular calculations.
The Big 4/8 traders are still a force to be reckoned with in gold and silver. They were nowhere to be seen in silver during this past reporting week, but did add to their short positions in gold.
As I keep pointing out in this spot every Saturday, the circumstances in silver have been altered by an unimaginable [and monstrously bullish] amount by Ted’s discovery of the 1 billion troy ounce physical short position in silver that Bank of America holds in the OTC market…along with the big increase in Goldman’s derivatives position in silver in that market, as shown in the latest OCC Report for Q1/2022…which Ted figures is a long position.
The latest OCC Derivatives Report for Q1/2022 was posted about six weeks ago — and Ted had a lot to say about it in the public domain at that time — and that’s linked
here if you wish to refresh your memory. The new OCC report for Q2/2022 won’t be out for about seven weeks.
The situation regarding the Big 4/8 commercial shorts in silver, gold [and in platinum for those commercials in the Producer/Merchant category] is still obscene to some extent, but as I mentioned a few paragraphs ago, has decreased drastically as of late.
As Ted has been pointing out ad nauseam forever, the resolution of the Big 4/8 shorts positions will be the sole determinant of precious metal prices going forward…with that resolution getting closer with each passing week.
And, as always, nothing else matters — and I certainly look forward to what he has to say in his weekly review later this afternoon EDT.