By Eric Bush, CFA - Gavekal Capital Blog
In late April and early May, commercial traders had taken major short positions in gold, silver and the yen according to the commitment of traders report. For gold, commercial traders were as short as they had been at any point in time since October 2010. The short position was even more extreme for silver. Commercial traders were short silver to a degree that they hadn't been since December 2014. Over the past month, however, these extreme positions have backed off somewhat. The net short commercial position in gold has fallen from roughly -295k contracts to -225k contracts as gold has fallen by about 6% . The net short position is silver has moved from approximately -92k contracts to -78k contracts as silver has fallen by about 9%.
Similarly, commercial traders were not short the yen nearly -77k contracts at the end of April. This was the largest net short position since March 2008. The net commercial position has increased to -23k shares as the yen has weakened against the dollar from 106 to 109.5.