evening wrap
market vibes
October 2…)
“Time is the only critic without ambition.” Steinbeck
Another profoundly quiet day in NY. Copper held its early gains and advanced, but its behavior is so technically anemic a long entry is just gambling.
I saw a post on X saying Comex gold was heavily long, so I checked it out. Swap dealers are record short so at least half of OI is in EFPs maybe more. I’m not sure what the implications of this record are exactly but a swap of 25 mm toz Comex is no little thing and its getting bigger faster. At the highs the weak side is probably not the long side, just sayin’…
Net noncommercial length is high, but total holdings of gold ETFs are still down 23 million from mid 2022. Open interest in Comex gold is down 30k with FND for Oct gold and aggregate OI has not changed since last March.
FUD is everywhere because gold is so quiet, and longs are frustrated. Imo… when specs are winning high COTs are bullish. The mid-point of entry for these 315k lots of longs is Last March when gold was $500 lower.
Registered gold inventories are 7 mm toz down from 18 mm in 2022. China is going to import 1000 tons or more this year (25% of newly mined gold). China and Russian production is another 1000 tons coming off the market. China is not the only buyer of gold. Poland Turkey the “Stans” India… are buyers and repatriating from foreign custody. But it’s hard to make money on the highs and when people get bored they often get bearish.
Silver traded above $32 but SLV got close to $30, and silver sold off $0.80 cents However it recovered to $32 at 4 PM when SLV closed. About 10 million of the Oct 18 $30 calls were covered on this dip. ca 12.2 mm shares $30 C are still out. Ca 24 mm shares of calls between 29 and 32. One share = one ounce. Quiet on the highs all day with a decent range.
S & Ps were briefly lower, but a large buyer(s) swooped in for a full hour and saved the day. As soon as the index regained unchanged … the buying stopped, and the market stopped.
In other markets Bitcoin closed on its low. The JMMC stayed with its cuts and oil gave back half its gains on the day. It appears this level of BPD is the new OPEC baseline.
my vibe
These are very hard markets to get long, to be long, to stay long but it’s like an escalator. You don’t go up if you don’t get on and it's very hard to get back on when if you’re not on when things are moving.
I think the weak side is above us. Just for me I’d rather be wrong than be out. The trick is to have a view and own it. And have a plan and stick with it, especially when the markets are quiet, and nothing is moving.
Pray for peace. Peace is like rain…it falls on everybody.
Good luck in Asia!
JJ
Please feel free to share selectively with friends and colleagues. Thanks a million for your likes!!
Follow me on X @Alyosha745
Charts and data CQG and Bloomberg
Market vibes is not a registered investment advisor, and comments are for informational use only. Any mention of a particular security, index, derivative, or other instrument is NOT a recommendation to buy, sell, or hold that security, index, derivative, or any other instrument. Metals, oil and everything else makes no representations as to the accuracy of data or any attributions.