Something good this way cometh....?

by John A. Sarkett
Option Wizard® Scan


CAPTION. Graphic analysis by Option Wizard® financial engineer Franklin S. Sarkett.  This chart shows that over the last 110 weeks, commercial net short position as reported in the weekly Commitment of Traders Report declined more than 10% 14 times.  (This past Friday, June 15, 2007, short interest dropped 28%.)  Each time this happened, spot gold was higher 12 weeks later.  The average 12 week move in spot gold was +8.56%.  An average move, this time then, would put gold at $710.52  Sept. 15, 2007.  Will it happen?  Stay tuned........

 

Commitment of traders (COT) data released Friday, June 15, 2007 at the customary 2:30 p.m. Central Time indicates we may be on the brink of a significant move in gold. 

Net commercial short interest dropped significantly -- 28%.

As per the chart above, when short interest declines 10% or more, week over week, spot gold moves up 8.56% in 12 weeks on average. 
(see table below for data history)

Why do so many follow the COT net commercial short interest indicator?  In gold, Big Commercials "know."  In the last 110 weeks, when short interest dropped 10%, gold moved higher 14 of 14 times.

This indicator, plus recent firming in gold may presage another positive move. 

Why does gold look higher?  Six reasons jump out:

 

 

 

 

 

 

 

History says this means higher prices ahead.   Putting these six all together:  getting a sense that something good -- for the precious metals community -- this way cometh.  No technical indicator is flawless; as always, time will tell....stay tuned.  J.S.

   
GOLD CHANGE DATE COMMERCIALS NET SHORT  CHANGE   % CHANGE 
         
654.50 8.90 6/15/07                98,505    (38,391) -28%
645.60 -25.00 6/8/07              136,896     17,701 15%
670.60 15.70 6/1/07              119,195     (5,521) -4%
654.90 -5.70 5/25/07              124,716    (23,077) -16%
660.60 -9.50 5/18/07              147,793    (25,171) -15%
670.10 -16.80 5/11/07              172,964      6,311 4%
686.90 8.00 5/4/07              166,653     (5,620) -3%
678.90 -12.70 4/27/07              172,273     (2,825) -2%
691.60 6.80 4/20/07              175,098     21,894 14%
684.80 11.00 4/13/07              153,204     23,706 18%
673.80 10.50 4/6/07              129,498     (9,026) -7%
663.30 7.10 3/30/07              138,524      8,630 7%
656.20 4.00 3/23/07              129,894     (1,022) -1%
652.20 2.00 3/16/07              130,916     (6,395) -5%
650.20 4.40 3/9/07              137,311    (46,439) -25%
645.80 -37.10 3/2/07              183,750     15,600 9%
682.90 14.40 2/23/07              168,150      2,686 2%
668.50 1.80 2/16/07              165,464     18,800 13%
666.70 21.00 2/9/07              146,664     11,053 8%
645.70 1.10 2/2/07              135,611     17,034 14%
644.60 9.20 1/26/07              118,577     26,468 29%
635.40 10.00 1/19/07                92,109     10,435 13%
625.40 20.30 1/12/07                81,674    (30,773) -27%
605.10 -30.90 1/5/07              112,447      9,379 9%
636.00 16.40 12/29/06              103,068      1,336 1%
619.60 5.00 12/22/06              101,732    (14,550) -13%
614.60 -12.20 12/15/06              116,282     (3,886) -3%
626.80 -18.30 12/8/06              120,168      2,444 2%
645.10 7.20 12/1/06              117,724     (1,252) -1%
637.90 16.10 11/24/06              118,976     (4,545) -4%
621.80 -7.50 11/17/06              123,521      9,065 8%
629.30 2.10 11/10/06              114,456     22,560 25%
627.20 29.20 11/3/06                91,896     11,387 14%
598.00 5.20 10/27/06                80,509     (2,629) -3%
592.80 3.90 10/20/06                83,138         536 1%
588.90 16.70 10/13/06                82,602     (9,392) -10%
572.20 -26.50 10/6/06                91,994     (3,371) -4%
598.70 9.50 9/29/06                95,365     (6,560) -6%
589.20 11.90 9/22/06              101,925     (8,770) -8%
577.30 -32.40 9/15/06              110,695    (20,570) -16%
609.70 -14.70 9/8/06              131,265     14,020 12%
624.40 2.60 9/1/06              117,245    (10,828) -8%
621.80 9.90 8/25/06              128,073     (7,056) -5%
611.90 -21.40 8/18/06              135,129     (6,796) -5%
633.30 -11.00 8/11/06              141,925      3,492 3%
644.30 9.00 8/4/06              138,433     (1,056) -1%
635.30 15.60 7/28/06              139,489        (602) 0%
619.70 -46.60 7/21/06              140,091      8,044 6%
666.30 33.70 7/14/06              132,047      9,880 8%
632.60 19.20 7/7/06              122,167      5,926 5%
613.40 28.40 6/30/06              116,241     (6,030) -5%
585.00 6.60 6/23/06              122,271    (12,130) -9%
578.40 -29.80 6/16/06              134,401      5,032 4%
608.20 -28.60 6/9/06              129,369     (9,940) -7%
636.80 -14.00 6/2/06              139,309     (9,694) -7%
650.80 -6.20 5/26/06              149,003    (14,147) -9%
657.00 -53.50 5/19/06              163,150     (8,183) -5%
710.50 28.10 5/12/06              171,333        (387) 0%
682.40 30.80 5/5/06              171,720      4,865 3%
651.60 19.10 4/28/06              166,855     (5,669) -3%
632.50 39.50 4/21/06              172,524      6,575 4%
593.00 5.20 4/14/06              165,949     (4,966) -3%
587.80 6.30 4/7/06              170,915     21,203 14%
581.50 21.30 3/31/06              149,712     13,910 10%
560.20 6.20 3/24/06              135,802      5,466 4%
554.00 14.10 3/17/06              130,336    (26,525) -17%
539.90 -25.90 3/10/06              156,861           -   0%
565.80 7.40 3/3/06              156,861      6,908 5%
558.40 6.60 2/24/06              149,953         748 1%
551.80 1.60 2/17/06              149,205     (5,233) -3%
550.20 -16.90 2/10/06              154,438    (12,844) -8%
567.10 8.60 2/3/06              167,282     (7,723) -4%
558.50 4.90 1/27/06              175,005     (6,986) -4%
553.60 -2.90 1/20/06              181,991      1,782 1%
556.50 17.70 1/13/06              180,209 127.00 -4%
538.80 22.20 1/6/06              187,308 109.30 -1%
516.60 13.90 12/30/05              189,234 87.10 0%
502.70 -0.20 12/23/05              189,531 73.20 5%
502.90 -23.40 12/16/05              180,730 73.40 -5%
526.30 23.40 12/9/05              190,292 96.80 5%
502.90 7.10 12/2/05              180,519 73.40 0%
495.80 10.60 11/25/05              180,241 66.30 17%
485.20 17.00 11/18/05              154,279 55.70 3%
468.20 12.00 11/11/05              150,416 38.70 -6%
456.20 -16.60 11/4/05              160,331 26.70 -11%
472.80 5.70 10/28/05              180,791 43.30 -9%
467.10 -2.10 10/21/05              199,507 37.60 -6%
469.20 1.50 10/14/05              212,714 39.70 5%
467.70 -1.00 10/7/05              202,724 38.20 4%
468.70 1.60 9/30/05              194,114 39.20 4%
467.10 3.80 9/23/05              187,077 37.60 18%
463.30 10.30 9/16/05              158,789 33.80 7%
453.00 5.20 9/9/05              148,617 23.50 6%
447.80 5.70 9/2/05              139,650 18.30 -28%
442.10 -0.10 8/26/05              193,874 12.60 0%
442.20 -3.60 8/19/05              193,366 12.70 28%
445.80 9.20 8/12/05              150,830 16.30 51%
436.60 7.10 8/5/05                99,807 7.10 21%
429.50 5.10 7/29/05                82,809   -1%
424.40 3.90 7/22/05                84,048   -24%
420.50 -2.20 7/15/05              110,908   -21%
422.70 -6.70 7/8/05              140,341   -15%
429.40 -10.60 7/1/05              165,574   15%
440.00 2.10 6/24/05              144,062   64%
437.90 11.00 6/17/05                88,090   31%
426.90 3.80 6/10/05                67,052   27%
423.10 3.80 6/3/05                52,996   -12%
419.30 2.00 5/27/05                60,463   -24%
417.30 -2.40 5/20/05                79,861   -26%
 

 

 


New nonfiction from Sourcebooks, by the creator of Option Wizard® Scan:

CHICAGO -- Option Wizard® is a registered trademark of Sarkett & Associates, Inc. -- 111