Speculators returned as buyers in all precious and
base metals futures and options traded on the Comex division of the New
York Mercantile Exchange and the Nymex, according to U.S. government
data, spurred in part by a rise in prices.
For the week ended Feb. 5, speculators in the Commodity
Futures Trading Commission’s weekly commitment of traders report pushed
their net-long positions in the platinum group metals to even higher
highs. Funds also bolstered their net-long positions in copper on hopes
of a strong economic outlook. There were increases in speculators’
net-long positions in gold and silver, although the gains were
relatively modest in silver.
Prices were firmer across the board during the timeframe
measured. In the week to Feb. 5, Comex April gold rose $10.80 to
$1,673.50 an ounce, while March silver gained 69.10 cents to $31.875 an
ounce. Nymex April platinum rose $28.30 to $1,707.20 an ounce during
the week, while March palladium rose $15.70 to $765.45. March copper
gained 7.85 cents to $3.7700 a pound.
After slashing positions in the previous report, managed-money
accounts lightly boosted exposure to gold futures and options in the
disaggregated report, increasing their net-long position to 86,926
contracts. Managed-money accounts added 4,807 gross longs and cut 38
gross shorts. Producers added to their net-short position by cutting
more gross longs than gross shorts, while swap dealers lifted their
net-short position by cutting gross longs and adding gross shorts.
Market watchers said the modest increase in the speculative
net-long in this report likely reflects the see-saw action gold has
exhibited lately, meaning that participants are likely not keen to put
on big positions in a market that shows no solid direction.
The situation was different in the legacy report as
non-commercials sharply increased their net-long position, having added
13,623 gross longs and 198 gross shorts. They are now net-long 144,495
contracts. Despite the jump in the net-long position, it does not make
up for the heavy drop seen in the previous week’s report. Commercials
are net-short, having heavily cut gross longs and just a handful of
gross shorts.
Barclays noted that “fund length as a percentage of open
interest has risen to 32% but gross short positions are at their highest
since July 2012, posing the potential for a short-covering rally,
should macro data worsen.”
The silver net-long position for the managed-money accounts
rose modestly to 29,628 contracts. They reduced exposure in general to
silver, but rise came from cutting more gross shorts, 1,510 contracts,
than gross longs, 1,461. Producers are net-short and amplified that
position by adding more gross shorts than gross longs. Swap dealers are
also net-short, but reduced their position by cutting more gross longs
than gross shorts.
In the legacy report, the silver net-long for non-commercials
also rose slightly, in similar fashion. They cut 1,526 gross longs and
cut 1,970 gross shorts, signifying the gain came mostly from short
covering. They are now net-long 37,365 contracts. Commercials are
net-short, and expanded exposure by adding more gross shorts than gross
longs.
Again, speculators in both disaggregated and legacy reports in
the platinum group metals further extended the net-long positioning,
setting fresh records.
Managed-money accounts in platinum increased their net-long
position to 42,530 contracts, having added 1,898 gross longs and 305
gross shorts. Non-commercials also augmented their net-long position,
which now is 52,026 contracts, having added 3,090 gross longs and
1,026 gross shorts.
In palladium, the managed-money accounts raised the net-long
position to 22,824 contracts. They added 814 gross longs and 522 gross
shorts to increase the net-long position. In the legacy report,
non-commercials added 1,442 gross longs and 416, lifting their net-long
to 25,734 contracts.
“Net long positions in silver, platinum and palladium were also
increased slightly further, which expresses how optimistic market
players currently are about the more cyclical precious metals in
particular, which are predominantly used in industry,” Commerzbank
said.
Anne-Laure Tremblay, precious metals strategist at BNP Paribas,
said while risk appetite is driving PGMs, she said investors need to
stay vigilant with positioning at record highs. Several other market
watchers have said recently PGMs could be vulnerable to sharp sell-offs
if bullish sentiment changes.
The copper net-long position for the managed-money accounts rose
significantly, to 22,650 contracts, as they added 9,691 gross longs
and 1,489 gross shorts. The rise of net longs was more pronounced in
the legacy report. Funds bolstered their net-long position, adding
11,213 gross longs and 4,390 gross shorts. They are net-long 16,187
contracts.
The sharp gains seen in net-long positioning in copper was
reflected in the rise in prices, said Commerzbank. “Thus money managers
have contributed to the 2% increase in the price of copper seen during
the period under review, evidently inspired by positive economic data
both from China and the U.S. at the beginning of the month,” they said.
Asad Rasheed
Mob:050-8774861
Email:asad@cfb.ae
For more information please visit our websit. www.cfb.ae
News Source: www.kitco.com
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