The only thing I can say about this report is that it makes absolutely no sense whatsoever to me and this is coming from someone who has been looking at these reports when they first came out many years ago.
Over the last two week reporting period dating back to 2/15/2011, silver has risen 340 points from Tuesday to Tuesday. This week alone, it increased 157 points from the close of trading last Tuesday to the close of trading this Tuesday. Both today's COT report and the previous report show the managed money category actually reducing net long side exposure to silver. That is odd enough in the first place.
If that were not enoug the reports show a continued build in net short exposure among the big Commerical, End User/Producer category.
The Swap Dealers did a bit of short covering this past week reducing their net short exposure by 2,272 contracts (futures and Options combined) but the previous week they also increased their net short exposure.
Meanwhile, the "Other Reportables" category registered net selling in both of the last two reporting periods.
Only the small spec category, showed a consistent increase in net long side exposure.
When I look at this report and I see a market that has surged to the extent that Silver has, and I see Managed Money actually decreasing their net long exposure with the only category being consistent buyers being that of the small speculator, I am very skeptical as to the intregity of this data. Small specs do not buy in sufficient size to take markets for rocket rides of this extent. It takes much bigger firepower to do so.
Overall open interest in silver continues to fall off as the price works higher indicating the presence of a decent amount of short covering. It does not take a rocket scientist to understand that those with short positions in this market are bleeding profusely. What is strange and bewildering and the reason I suspect this data is because we are seeing what I believe is a disconnect between the daily open interest readings in silver which is provided by the exchange and what is occuring inside this market from the data being provided by the CFTC.
Additionally, the bank participation report actually shows a big increase in short side exposure in silver among the big banks for the March data.
What I want to know is where all the buying that is taking this market higher is supposedly coming from? It sure as hell isn't coming from the Managed Money side of things based on the last two CFTC reports. So, who's buying this market????
"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat
Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput
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