Here Is The Reason For Gold’s Massive Surge Above $1,300

With gold surging above the critical $1,300 level, today the man who provides macro research and commentary to many of the largest financial institutions and top hedge funds around the world sent KWN 6 absolutely stunning gold charts illustrating the why the gold market has smashed well above key resistance.  Eric Pomboy, who is founder of Meridian Macro Research, also provided incredible commentary to go along with the 6 remarkable gold charts, as well as what all of this means going forward for the gold market.

July 22 (King World News) – Gold Surges Through Key $1,300 Level – Charts Of The Day

COT data for week ending 7/16 show Commercials added to their Net Short Position by ‐5,566 contracts.  As for the Specs, they added +6,905 contracts, bouncing off the lowest Net Long position since 2005.  It’s too early to tell of course, but the data may signal the bottom for Gold is in.

 

 

Looking at the Net Commercial position in relation to Open Interest (see below), we get a strong flashing buy signal at these levels.  Again, too early to tell, but the data would certainly suggest a significant and extended rally is near.

 

 

The Gold relative to Net Commercial Position chart is most telling (see below).  We’ve seen a huge bounce off the historic low of ‐6.75, to ‐5.27, a 22%, 1‐week bounce.  The exact same happened at the 2005 and 2008 bottoms for Gold (at $412 and $712 respectively) — In 2005, a 1‐week (22%) bounce from ‐1.10 (low) to ‐0.85; in 2008, a 1‐week (22%) bounce from ‐1.13 (low) to ‐0.88.  Each time signaled a bottom for gold, and each time a 70‐72% rally ensued.

Source: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/7/22_Here_Is_The_Reason_For_Golds_Massive_Surge_Above_$1,300.html

5 Incredible Charts Covering Gold To The “Surprise Index”

Today the man who provides macro research and commentary to many of the largest financial institutions and top hedge funds around the world sent KWN 5 incredible charts illustrating covering everything from gold to the “surprise index.” Eric Pomboy, who is founder of Meridian Macro Research, and whose sister Stephanie Pomboy appears in Barrons, also provided tremendous commentary to go along with the 5 stunning charts, as well as what all of this means going forward.

By Eric Pomboy Meridian Macro Research

July 10 (King World News) – Gold & Silver Charts Of The Day

“The COT data for week ending 7/2 show a 35% reduction in Net Commercial Position to ‐22,776 contracts … the least Net Short reading since Jan 8, 2002 when gold was $279/oz. With a Net Long reading not far off, a significant upside reversal for gold is clearly in the works.

Regarding Friday’s Payroll Report, things are not as rosy as the headline data suggest. First, 195k jobs added sounds like a solid number … but it’s only 79k jobs above the (6mo. average) of Population Growth. Second, if you look at the gap between U6 and U3 number of unemployed (chart below), the monthly change was a staggering +786k persons … the largest monthly jump since December 2008 (+800k), thus the rise in U6 rate from 13.8% to 14.3%.

Third (next chart), the number of full‐time employed dropped by ‐240k, bringing full‐time employed as % of Total Labor Force to 74.4% … still in historically low territory and indicative of a very uneven labor force (full/part time) composition. In the last 3.5 years, 5.43 million full‐time jobs have been created. In order to reach a more ‘ideal’ 79‐80% over the next 4 years (factoring‐in population growth), we’d have to create about 12 million full‐time jobs, or 250k jobs per month … which seems highly improbable. Considering full‐ time jobs dropped ‐240k and part‐time jobs jumped +360k for June, we’re clearly moving in the wrong direction.

Also, the total of Non‐Full Time employed is at a fresh historic high as of the June data…up +400k to over 28 million people. The takeaway from these numbers is: we could get to 6.5% (or even 5.5% or lower) headline U3 unemployment rate in the next few years, yet based almost entirely on part‐time job creation. None of this is good news, as quality of jobs is clearly more important than quantity….

Source: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/7/10_5_Incredible_Charts_Covering_Gold_To_The_Surprise_Index.html

Incredibly Important Developments In Gold & Silver Markets

Today King World News is reporting on incredibly important developments taking place in the gold and silver markets.  Acclaimed commodity trader Dan Norcini spoke with KWN about the action in both of these key markets and provided two tremendous charts.  Below is what Norcini had to say in his interview.

Norcini has been stunningly accurate in his predictions of the movement in the gold and silver markets.  Now the acclaimed trader discusses these incredibly important developments in both of these markets below:

Eric King:  “I will hand it off to you on the COT (Commitment of Traders Report).  Dan, you can give out the numbers there, but I told you I thought there was a 50,000 contract shift by the commercials (this week, which will be reported in next week’s COT report).  So they should (now) be net long (gold) 30,000 to 35,000 contracts.  I told you I thought it was (the year) 2001 since they had been long.  You went and checked the history and indeed it was.”

Norcini:  “Yes (the commercials were last long gold in 2001).  We don’t have the detailed breakdown to data that far (back), that we do since they revised it going back to 2006, but nonetheless we can get a pretty good insight into who was positioned where.

Of course gold was in a bear market for 20 years before it was turning, but when you look at the positioning of speculators, they had been driving that market down.  The funds were short and the commercials were long (back in 2001) (see chart below).

 

But what basically happened was the commercials were positioned on the long side of the gold market at the very bottom in November of 2001.

If you go back and look at a monthly chart (see below), it’s kind of interesting because that was the bottom (in 2001 when commercials were net long gold).  From that moment on the gold market never (broke below) that low.  Gold was trading around $274 an ounce and it never again went down to that level.  That’s noteworthy.

 

Generally, Eric, I don’t like to make a big deal out of these COT reports because way too many people (attempt to) use them as some sort of “Holy Grail,” but I think at this point, because of the dramatic shift we’ve seen now, we are going to have to start paying attention to positioning of these traders from this point forward.

Based on this most recent (COT) report the hedge funds were still net longs in this (gold) market, and the commercials were still net short.  But that did not cover Wednesday, Thursday or Friday’s activity.  And as we know, that was huge volume on Thursday, some of the biggest volume we’ve seen in gold for a long, long time….

“There was a big change internally in this market and a huge shift in the composition of who was on what side (of the gold market).  My suspicions are like yours.  I would not be the least bit surprised when we see next Friday’s (COT) report, to see that maybe a 50,000 contract shift, from basically the commercials being net short 15,000, to perhaps being net long by 30,000 contracts, and the hedge funds (now being) on the net short side of this market.

Source: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/6/23_Incredibly_Important_Developments_In_Gold_%26_Silver_Markets.html