Speculator Gold Gross Shorts At All Time Highs

Tyler Durden's picture

Premia for gold bars (physical over paper) rallied to their highest since late-2008 according to SocGen, even as 'professional' investors look to position the exact other way. The combined short positions of futures and options speculators in COMEX gold is now at a record high for the third week (having surged from 4.3 million ounces in late September to a a stunning 13.9 million ounces short now. At the same time, Gold ETFs have only seen one in-flow day in the last 34 days. It seems investors are well-and-truly on one side of this boat - even as price continues to buck the supposed structural weakness.

COMEX Gross Short positions...


ETF Holdings...


but price is now ignoring the flows (despite the protestations of some in the media)...



Via SocGen:

Shortage of metal drives premium higher as customers told to wait for delivery


While many professional investors looked to exit the market, the opposite response in the physical market to this recent price fall has also been dramatic. The price drop ignited a buying frenzy in Asia and other parts of the world, leading to a shortage of gold bars and coins in Hong Kong, Singapore and Tokyo, and helped the metal stage a rebound. The sudden demand surge caught many traders off guard and sent premia for the yellow metal soaring.


The US Mint had to suspend sales of certain coins as buying ramped up. The Mint sold an estimated 210,000 ounces of American Eagle gold coins in April; almost three and a half times more than the 62,000 ounces it sold in March. Similarly, the Perth Mint in Australia went into overdrive, working around the clock to keep up with an intensity of orders not seen since the 2008 global financial crisis.


Premia for gold bars rallied to their highest since late-2008 in Singapore and touched an 18-month peak in Hong Kong after a spate of physical buying led to supply constraints. Premia in Hong Kong touched $4/oz while in the Middle East there have been reports that both Istanbul and Dubai ran short of investment bars, with wholesalers paying a premium of $6-$9/oz for kilobars.


Retail gold sales tripled across China on April 15-16 after the rout, according to the China Gold Association. On the Shanghai Gold Exchange (SGE), daily physical volumes averaged 12.9 tonnes from the start of 2013 through to the close of business on 10th April. During this time the average premium on the SGE over loco London metal was just over $13/oz, itself a substantial increase from the 2012 average premium of less than $7/oz. While in contrast, during the price drop between 11th and 26th April, physical volume on the SGE averaged 32.6 tonnes daily, with an average premium of $20.4 over the London fix.


Turning to India, investment demand (albeit boosted by the imminence of the Akshaya Tritiya festival) has been significant with premia surging to a peak of $30/oz briefly before settling back to $8/oz in recent days. Imports exceeded 100 tonnes in April and looks set to repeat the performance this month ahead of restrictions proposed by Reserve Bank of India that will likely ban or at least restrict bullion imports on a consignment basis.


While investment bar and coin premia has eased from the frantic highs, they remain at elevated levels in several markets, with robust demand surging at every retracement in price. Mints and refineries continue to struggle to deliver supply chain orders with up to a one-month wait for delivery. For now though, there appears to be a growing disconnect between paper and real gold.

Charts: Bloomberg

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fightthepower's picture

Anyone going to buy less if the price goes down?

Jekyll_n_Hyde_Island's picture

When BlackRock says buy Gold, I'm in like Flinn.

  Not that I wasn't already; their assesment means there will be a sheeple run. 

Herd Redirection Committee's picture

Wall St price is telling the world:  Gold?  Who needs gold when you could have treasuries!  Or your choice of fantastic equities, like our most recent IPO, Facebook, which is down 29% since launch, and has a P/E of 1737.  But don't worry, a high P/E means its GROWING FAST.

Physical markets worldwide are telling Wall St: You are telling me the price of gold is $1435 USD per oz.   Here is $1435 USD, and yet, you will not give me an oz. of gold!

NotApplicable's picture

Gee, so there's record gold shorts, meanwhile a Mr. Matthew Craft of the AP is busy delivering gold's eulogy.



Herd Redirection Committee's picture

Hope he is getting paid well to sell out his fellow countrymen...

He talks about "withdrawal(s) out of gold funds" and then says its not clear where the "money rushing out of gold" is going.

Hmmm....  Does this guy have two brain cells?  That a gold fund that tracks the price of gold might differ from.... The physical stuff itself?  That if you withdraw your funds from a gold fund, you are not selling your gold, you are asking for physical delivery! 

philipat's picture

This could be a set-up by the BB's who are now net LONG. A reversal would force short covering by the specs and see a very significant trend reversal?

DoChenRollingBearing's picture

Anecdotal data point.  The Bearing bought gold in increments after the price plunges, but is now OUT of FIAT$ to buy moar.  

Another anecdotal data point: the 24hgold.com/eBay widget shows a premium of 11.8% of price for AGEs vs spot price, relatively high, it has been rather high for two weeks now.

24hgold.com, at the bottom of their home page.

fonzannoon's picture

DoChen you say you are out of fiat? My guess is that is what they are counting on. Now if they can just crush you until you have to cough up that worthless relic. That would be something.

francis_sawyer's picture



Do you 'anecdotally' think that I should start doing TAI CHI?

DoChenRollingBearing's picture



@ fonz

$ "money" will come in when it comes in, no way do they get my gold.  Squeeze that, bitchez.

@ francis_sawyer

F**k yeah, any way you can do Tai Chi is worth it!  Unless it's rayciss...

Bay of Pigs's picture

Sadly, looks like a bunch of us might be leaving (getting banned) this once proud site which always encouraged freedom of speech. Amazing to see Fight Club turfed by its current owners. Good luck everyone if this is the end of road for ZH. Its been a great run.


FEDbuster's picture

Is a "Libtard" an affiliation or just an affliction?  It's not a race (yet) or religion (maybe?).

Also, does this mean WB7 is gone, too?  You know Debt Brother #1 and the Bernak may take offense to the visuals.

smlbizman's picture

it really was the last place of freedom...next no more down arrows...i guess they put jump the shark back on the map....im pissed....

buyingsterling's picture

What is racism?

Sometimes it's obvious: beaners all need to die.

Sometimes it's political/social: we should seek to keep massive numbers of hispanics from strolling across our border and overwhelming our welfare system.

Sometimes it's just Fking wack: African American and hispanics test lower than Asians and whites on all tests that can arguably be associated with intelligence.

Tens of Millions (billions?) of people would argue that all three are racist statements, while sane people would be more inclined to find the first a racist statement, and the other two not remotely so. Let's hope the ZH staff is sane.

Question: Does this mean Francis Sawyer has already been booted? He's too blunt to take the delicate approach to Jews, which is: Jews have an average IQ 10 points higher than north Asians, 15 points higher than whites, and 25-30 points higher than Latinos and blacks, so we ought to expect that they will gravitate to and succeeed in the most challenging/rewarding/rapacious/manipulative endeavors: banking, law, medicine, entertainment financing etc.

WhackoWarner's picture

my darling dochen

quit, cease, and desist from ever using the useless macho idiot cry of "bitchez"

then and only then will I consider you to be a Tai Chi non-racist.

You are what you do and say.

WhackoWarner's picture

End of comments comes now.

This site has descended into a great deal of idiocy. Reminds me of a coach-abused rugby team.

Private school boys with bullying behaviors. Egomanical comments that serve to enlighten noone.

Other words a clique of mal-adjusted behavior.

I ask? What makes you swarm of locusts at ZH (you recent arrivals who cannot resist using "Bitchez" replies and repetive, non-thinking behavior as a declaration that "yes I am here and am part of the gang....when in fact you are non-thinking sheep grazing in a different meadow.)

It is a wonder to me that Tyler and the gang continue to allow this comments crap to go on and on when so polluted by nonsense. Many contributors here are no smarter, no less "tainted", no less ignorant than all they rant against.

"bitchez" as a battle cry. You fools. You deserve to sink.

nobodyimportant's picture

Just goes to show you that ZH has no balls  - is that a slight to eunuchs?  Only an idiot would think his religion, race, etc is inferior to others. 

greatbeard's picture

>> looks like a bunch of us might be leaving

I've been banned from a number of sites, not for racism, but more othen than not for having a differing editorial opinion.  It doesn't take a heck of a lot of brain power to express your thoughts without delving into mindless drivel like racism.  I hardly see where the same wankers ranting their jew banker tripe or anyone of color is a mooch mantra helps anyone.  Elivating the discourse above the animal camp level isn't necessarily a bad thing.  Nobody learns anything from repeated  mindless banality.

BooMushroom's picture

You can have a different opinion, so long as you don't have the wrong opinion about Darwinian selection having effects on Homo Sapiens on something other than skin color, epicanthic folds, melanin levels, prevalence of sickle-cell anemia, and a whole host of other well-documented physical, biological characteristics.

In other words, you must not believe that there are .-'*ANY*'-. psychological, cognitive, emotional, subconscious or neurological differences between races (good or bad!). Despite the obvious biological and physical ones well proven.

James_Cole's picture


So that's what everyone's been going bonkers over. Not that I really care either way but it is comically ironic that a blog styled after fight club has such a policy.

Guess the advertisers weren't liking some of the unhinged commentators on here. 

smlbizman's picture

i guess it never is different this time......what a shame ...

Bay of Pigs's picture

My guess is the Wall St Banksters, Zionists and NWO types dont like being called out @ ZH all the time.

Not to mention the gold trolls, who are completely unhinged. 

James_Cole's picture

My guess is the Wall St Banksters, Zionists and NWO types dont like being called out @ ZH all the time.

Not to mention the gold trolls, who are completely unhinged. 

Advertisers more specifically exclude porn sites, sites with graphic content / illegal content & sites featuring racism. 



It's very easy to exclude such sites and would immediately be felt in zh's revenue. And their ad revenue must be pretty substantial. 


akak's picture

Funny, James, how BayofPigs mentioned gold trolls in a generic sense, and you immediately came charging in.

James_Cole's picture

Funny, James, how BayofPigs mentioned gold trolls in a generic sense, and you answered the charge.

I'm guessing BoP mentioned it as reference to our past arguments responding to me writing 'unhinged.' 

But speaking of 'answering the charge,' do you subscribe to my comments or something? Almost every time I write something on zh you show up. 

HyperinflatmyNutts's picture

+100.  it is the Zionists.  They told ZH they were going to pull their ad money and fight club just became WWF... 

Herd Redirection Committee's picture

If ZH ever needs to be reconstituted "Fight Club Part Deux" or "Project Mayhem Continued"  would be suitable names, IMO.

DoChenRollingBearing's picture

@ Bay


As I mentioned in ZH Chat, my GUESS is that ZH just put it in as BOILERPLATE.  Just to satisfy the Swiss lawyers.  Maybe they will loudly trumpet the occasional troll who is REALLY BAD.  I doubt (but who knows?) that we have much to worry about.


DosZap's picture


 now that ZH has gone mainstream, they must crack down on it.IF they want to continue to remain creditable,as a REAL news source,my take on it anywho.

silverserfer's picture

its ok bay o pigz its stil fight club. we are asked now to just put on these cute new zerohege fight mittens now when thrashing each other.

green888's picture

We do not all get along together- bit like a zoo, where they have learnt not to keep the rabbits and snakes in the same pen. As someone famously remarked, all the caucasians, the Africans, the Spanish, the Indians n Chinese, the jews, aborogines,cossacks and inuits want to bash a paki 

Diogenes's picture

It's all the fault of the TRIANGULAR CHEESEPOPES !

LynRobison's picture

Wah! If the price of gold goes down, I won't buy any more gold! Wah!

If the price of gold goes down, I won't be able to get as many paper dollars by selling my physical gold! Wah! I want to get more paper dollars! And I thought I could use gold get them! Wah! Now I might not be able to! Wah!

I hate gold! Wah! I will not buy gold ever again! Wah!

Herd Redirection Committee's picture

Exactly.  Owning gold and thinking of your gold in USD terms do not jive.  If you are holding for the end game, then you care about the price of gold in 'New Dollars'.

FEDbuster's picture

"If you are holding for the end game"

You may want to be holding canned food and ammo?

Herd Redirection Committee's picture

Diversification.  It doesn't mean what it used to.  In this case, geography is of paramount importance.

FEDbuster's picture

"Head West, young man (just not too far West)"

The blue plague is spreading, Colorado just fell.  Utah and Idaho look good. Utah's LDS population prepping as part of their religion gives it a slight edge, and is a beautiful state, too. 

Cacete de Ouro's picture

These Inv Banking Researchers are always looking in the wrong place.

SocGen is one of the 11 LBMA market makers for gold spot and forward and one of the 5 Gold Fixing Members, so they know the exact OTC trading patterns from their seat in London and the physical flows in and out of the market.

Then they publish this shit about comex and ETFs... Same for Barclays Suki Cooper and co and the other analysts.

Wake me up when an Inv Banking analyst actually writes about the London OTC gold market and the total vault figures in the London vaults...

Jim B's picture

I am actually bummed, I am hoping premiums will decrease before I buy moar! 

WmMcK's picture

We may have 2 serial down-voters on this thread.

MFLTucson's picture

This is indicative of just how courrpt this financial sytem and these bankers have become!


Pairadimes's picture

Front-running the next slam down.

css1971's picture

Shorts; People who like to give you stuff on sale.

slaughterer's picture

Surprised Gold and Silver are not down further on tapering fear.  I thought they would be slaughtered today.  

Herd Redirection Committee's picture

People say ending QE would hurt precious metals. 

Well, that depends if you believe the Fed, first and foremost.

Secondly, it requires you to believe that there are buyers out there for US Treasuries (i.e. that stopping the presses is even an option).

Third, you would have to believe that the biggest Wall St (and London) banks can withstand a raise in interest rates, at this point in time. 

Of all the three points, the third one is by far the most outlandish.  The big banks were BIG sellers of interest rate swaps, where variable rates were swapped for fixed rates.  The seller of the fixed rate benefitted when CBs worldwide initiated ZIRP. 

Now imagine you are Barclays, and you have all this debt at variable rates, which are currently as low as they have ever been, what would happen if interest rates were raised?  Anyone want to explain the derivative implications to the uninitiated?