Entries by Peter Brandt

Does the current CFTC COT Report forecast a decline in Gold prices?

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CFTC COT (Commitment of Traders) Report Forecast a Gold Decline?

In recent past, I have cited the CFTC COT (Commitment of Traders) report's record open interest by large specs and record short open interest by commercials as a possible negative for Gold prices. Never one to trust myself, I decided to dig deeper to find out if my claim held water.

In fact, there is no recent evidence that such extremes in commercial shorts and large spec longs are negative factors on subsequent price action.

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Do the CFTC COT data forecast a decline in Gold prices?

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In recent Factor communications I have cited the record large open interest by large specs and record short open interest by commercials as a possible negative for Gold prices. Never one to trust myself, I decided to dig deeper to find out if my claim held water.

In fact, there is no recent evidence that such extremes in commercial shorts and large spec longs are negative factors on subsequent price action.

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Always Consider Risk Management

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Recent events only highlight the importance of Risk Management. Late Thursday evening and early Friday morning I spoke by phone to many of the old-timers (some with near 50-year trading careers) in whom I have the highest level of respect. There was a universal consensus – we have never witnessed markets like those experienced over such a brief period of time. Even though I had almost no exposure, I stayed up into the late hours on Thursday evening watching in awe a broad level of volatility exceeding anything I can remember. There was, no doubt, some serious blood-letting. In the weeks ahead we will read and hear about some horror stories. More than one trading firm will announce bankruptcy. We will not hear about the hundreds of individual speculators whose accounts were destroyed.

Brexit Exit Polling by Hedge Funds

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The British government allows large hedge funds to conduct their own exit polling. They are not allowed to release their findings until 22:00 British Summer Time (BST) — there is no prohibition against their trading based on their own Brexit exit polling.

Properly sampled Brexit exit polling in UK voting is extremely accurate (usually within a +/- 1% error). Hedge funds will have a good indication on the Brexit vote by midday BST and will almost certainly have solid data by 18:00 BST. There is an embargo on publishing results until 22:00 BST. Thus, hedge funds will have a lead of many hours over the average market speculator.

Understanding global macro economics in 75 minutes

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Do yourself a huge favor and watch the following three presentations on global macro economics.

The first two are by my friend Raoul Pal, co-founder of RealVisionTV. It is my honor to be associated with RealVisionTV.

The second is by Ray Dalio, CEO and founder of Bridgewater Associates.

First, link to Raoul’s intro into his view of global macro. This video is 2:35 long. CLICK VIDEO

 

https://www.youtube.com/embed/he3SYgTQh2o

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Natural Gas Rising

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The dominant chart construction in Natural Gas is the completed 7- month H&S bottom on the daily graph (Oct contract). Note the appearance of a possible 6-day flag on the Oct chart.