This is so astonishing that I had to start a new thread.
I'll just give you the facts and I'll let you decide what it all means.
- We are approaching contract expiration and First Notice Day of the June13 contract. This is coming up tomorrow. At the close tomorrow, all holders of the June13 must show their intent for delivery by having 100% margin in their accounts.
- For the three days since Friday of last week, total Comex gold open interest has fallen by 10,000, 24,000 and 27,000 respectively for a total drop of 61,726, from 445,517 to last night's 383,791. That's a drop of 13.7%. In three days.
- For perspective, total OI bottomed out 1 day after the April13 FND at 407,112
- Total OI bottomed out 1 week after Feb13 FND at 420,766
- Total OI bottomed out 1 week after Dec12 FND at 427,200
- Again, with two days to go before June13 FND, total OI is just 383,791.
- Additionally, I've been trying to guesstimate how many might initially stand for delivery in June. Recall that 13,100 stood on FND for Feb but just 6,601 initially stood for April. The April number eventually doubled to 13,000 as folks "jumped the queue" during April.
- Back in March, 2 days before Apr13 FND, the Apr13 OI was still 33,774 of a total OI at 419,722 or 8.04%
- Back in January, 2 days before Feb13 FND, the Feb13 OI was 82,128 of a total OI at 438,918 or 18.71%
- As of yesterday, 2 days before Jun13 FND, the Jun13 was 27,450 of a total OI at 383,791 or 7.15% so it looks like, at least initially, that June will be more like April than February.
- Tomorrow, we'll get the final OI numbers for today. Since Wednesday saw gold rally $12 on a 27,000 OI drop (short-covering), what happened today during the $20 rise? Was it longs re-entering as projected on the previous thread or was it even more short-covering? If it was more short-covering, just how low is the total Comex OI right now, right this instant? 360,000? 350,000??
Finally, why does this even matter to you? I'll tell you: Because at 383,791, the total Comex open interest is at historically low levels, the lowest I've ever seen. The records I have don't go back far enough to show anything lower.This is, at a minimum, a multi-year low. Perhaps multi-decade. Maybe someone can email Gene Arensberg? He might know when the total OI was last this low.
But the only time I've ever seen a similar total OI was on 8/17/12 at 385,434. Why is that important? That night gold closed at $1615 and then set off the next day on a four-week trek that took it to nearly $1800. Are we on the edge of a similar rally? Hard to say. Back in August last year, the CoT structure was almost completely different as long interest had been completely wrung out during the awful beatdown of March-August. Now we sit instead with historic levels of Spec shorts...or at least we did when the last CoT survey was taken nine days ago.
So, anyway, I'm no sure what it all means which is why I wanted to simply present the data to you. Is the Comex finally dying the death I've been anticipating since the MFG collapse of 18 months ago? Maybe. Did the desperate criminal beatdown of 4/12-15 begin driving the final nail into the coffin? Perhaps.
Anyway, have at it. I look forward to reading your feedback.
TF
