Short Term Gold And Silver Bullish Sentiment Is Extremely High, The Possibility Of Short-Term Fall Is Relatively Large.

The latest COT report showed that as speculators increased their gold and silver around the fourth week, speculative net heads rose again. The COT report ended on Tuesday (April 11th) and ended before the US President Trump issued a "strong dollar" statement, which once pushed gold to close to $1290 / ounce, which means that last week's holdings are still more optimistic than the latest COT reports. But from a reverse perspective, this may make investors uncomfortable.

Nevertheless, investors are optimistic that gold can still be traced. Geopolitics Uncertainty still occupies a major position in the precious metal investment market. The situation on the Korean Peninsula is on the verge of war. There is still uncertainty in the French general election. The referendum on Turkey's universal constitutional amendment has passed, but the opposition party has said that there are illegal voting activities. All these will boost the price of gold and silver to a certain extent. Affected by risk aversion, spot gold on Monday (April 17th) broke through the $1295 barrier in early trading, reaching a maximum of $1295.45 / ounce.

Specific data show that the fund managers' gold long positions increased by 15827 hand contracts, short positions reduced by 8975. Despite the increase in bull positions, the price of gold fell by about $5 per ounce during the week of COT, which is not an optimistic sign. The gold price rose weaker than previously recorded in the same warehouse position.

The last five consecutive weekly increases were in early July 2016, when gold rose to that high level. This may seem like a bad news, but from another angle, the net long position is 286 thousand hands, and at present there are only 140 thousand hands, indicating that there is room for further increase in net long positions. The red line, the blue line, the black line and the green line are hedge funds (the largest speculative traders), swaps, producers and other reports, respectively. The crude blue line represents the price trend of precious metals in the same period. It can be seen that the speculative net multi head position of gold has increased by 24 thousand hand and 140 thousand hand contracts.

And silver. speculative Net multi head size increased to 99 thousand hand contracts. This is the highest level of silver speculative positions in the current statistics, even higher than the peak in 2016. At present, the price of silver is still below 19 US dollars / ounce, and in 2011 when the price of silver was close to US $50 / ounce, speculative net multi position was far below the current level.

Unless the demand for silver is strong, investors must remain vigilant. However, the sale of silver coins by the US Mint is the world's largest demand for silver. The following figures show that silver sales in 2017 were extremely low and the growth rate was far below that of last year. As of March this year, sales of silver coins reached 8 million ounces, estimated to be 32 million ounces throughout the year, a decrease of nearly 20% compared with the same period last year. Last Wednesday (April 12th), President Trump, in an interview with this newspaper, briefly expounded his attitude towards the US dollar, whether China is a currency manipulator and Yellen's term of office. Trump reacted to the low interest rate policy of the Federal Reserve, and revisited the argument in January this year, indicating that the dollar is too strong now.

For decades, the president of the United States dollar There are two kinds of attitudes. One is to avoid talking. The two is to support the strong dollar. But Trump is "not playing the cards". This is certainly not a positive news for the US dollar. In addition, Trump now likes and respects Yellen. This attitude has changed with his position during the election campaign, providing the possibility of Yellen's re appointment next year. Jo Trump did not want to see the "strong dollar". He might push the US dollar through policy and nomination of the Fed chairman. In addition to geopolitical risk, there is another US president who may push the dollar down. If so, the prospects for medium and long term gold are very bright. But the short-term gold and silver bullish sentiment is extremely high, so the possibility of short-term fall is relatively large.

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