Does Speculative Positioning Imply that Gold’s Bottom Is Near?

The CFTC (Commodity Futures Trading Commission) reports the position of major players in the futures market through its COT (Commitment of Traders) report. According to the COT report for the week ended June 26, 2018, money managers were barely net long on gold with just over 4,000 net speculative long contracts. According to Commerzbank, “Short positions, in particular, were built up, which means speculative financial investors are currently betting heavily on falling prices.” For the week ended June 3, money managers kept their positions almost unchanged, which implies the lowest levels of net long positioning since late 2015 when gold prices dipped below $1,050 per ounce.