by Taki Tsaklanos, Mountain Vision:
The speculative community has crushed the gold and silver price in the second quarter of this year. From a short term price perspective, the outlook for gold and silver is not too bright. On the other hand, investors who own the metal in PHYSICAL form (acting as their own central bank) have an ideal hedge against the increasing counterparty risk.
This week’s COT report (first chart gold’s report) provides an insight in the outlook of the precious metals. The COT report shows the futures positions of commercials and speculators. Their positions are important because those “paper markets” (COMEX and LBMA as the most significant ones) continue to dominate the price setting. Speculators include hedge funds in the “managed money” category in the reports.
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