FX:XAUUSD   Gold Spot / U.S. Dollar
1968 10 68
The Commitment of Traders report ( COT ) is published at the close of every Friday's trade and it always shows the Tuesday COT data.
The formula for Blees rating uses the Commercial Traders net contract holdings at the date of the current COT report.
We inserted the Blees rating into the daily chart .

The last Blees rating numbers (18) are showing that commercials were more heavily short in gold             this week Tuesday than last week Tuesday. Commercial short position has been increased again: it's nearly 10.000 more than last Tuesday (347.662 ---} 356.632). What is more interesting that the net commercial short position increased by 30.000 because the long commercial contracts dropped by 20.000. ( Longs down by 20.000, shorts up by 10.000, so the net short position is up by 30.000)
The Blees were 18 Tuesday , it has been turning down again. The blees rating at 18 is still showing to the lower prices.
(When blees will be between 50-70 that will show that longer term direction change is coming.)

The blees rating at 18 means to me that gold             is not ready for the next intermediate rally. Even if we don't have the panic selling at least we are going to go down to 1200 one more time in the following 2-3 weeks.

Gold_COT reports source:

Formula for counting the blees number:
Commercial shorts-commercial longs= X
X-last 2 years minimum X number=Y
Last 2 years maximum X- Last 2 years minimum X =Z
Blees= Y/Z*100
After last race, if there wasn't usd in good strengthen now, gold would be 10$ higher. 356.000 - nice number, but still not enough to stop this going higher. Needs at least 30.000-60.000 more shorters to come down imo (last rally prove that 357.000 wasn't enough). So next week and brexit week will be very important. If brexit fail and fed hawkish, we can have relief, if not - 1300+.
+1 Reply
Commercial shorts are considered weak hands, correct?
Nice, do you give more weight to the commercial shorts vs large speculators? It seems those have reduced their short position. Thanks!
Also, It looks like the Managed Money has reduced shorts by -8,854.
Muchas Gracias Amigo :)
Excellent work. Appreciated. Thanks
Thanks Arpi. But we have a rate decision on Wed which could change the whole situation right?
+1 Reply
AL_G Marvin
yes it can, yes it WILL!
nexuz Marvin
Lets think about the possibilities:

1. FED wont hike - at the latest countings only 4% expect them to hike in june after the NFP desaster. That scenario is alrdy priced in. Thats why we got those extreme movements dont expect too much volatility there.

2. FED wont hike/Yellen goes hawkish - Chartwatcher stated that scenario in one of his last Posts. Guess thats the most likely thing cause they can strengthen the USD a bit and still got the hike possibility in July (latest date in my opinion cause of elections) -> USD will go up / Gold will go down (well maybe if we count in the strange corelation of the last days) / and so on. Maybe they will also announce some kind of bond buying programm like the ECB announcend.

3. FED wont hike/Yellen goes dovish - USD would get bashed / Gold would rally to lets say 1350 in one day and so on. Unlikely to happen cause they need to calm down markets to ensure confidence in the economy. Depends also on the inflation rate in may.

4. FED hikes - USD would rally / Gold would get bashed. Money would flow into stocks cause that would ensure (FEDs) confidence in us economy.

My POV about those possibilities:

1. = 20%
2. = 50 to 60%
3. = 10%
4. = 10%

They need to do something after the bad NFP data to increase confidence in their actions. So i think Nr2 is the most likley scenario cause it would give them the opportunity to hike in july. To add that bond buying programm that would be a nice treatment to bring back confidence in their actions and help them to cover the damage that this job report unleashed.

Keep in mind im only an amateur like most of you guys! Would be nice to hear your thoughts on this
+8 Reply
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