Article / 11 December 2017 at 8:55 GMT

COT: Specs fleeing metals; Oil long remains close to record

Head of Commodity Strategy / Saxo Bank
  • Gold, silver and copper all seeing major long liquidation
  • Oil saw light profit taking after Opec+ meeting
  • Natural gas got slammed as the US winter is late arriving

By Ole Hansen

The Bloomberg Commodity Index hit a nine-week low last week with all sectors suffering setbacks. In response to this weakness, hedge funds cut bullish commodities bets by 8% or 138,177 lots in the week to December 5. Hardest hit was the metals sector with gold, silver and copper all seeing major long liquidation. 

Speculative positioning in Commodities
Funds cut bullish gold bets by a record 64,257 lots up until last Tuesday. A stronger dollar driven by rising rates expectations and progress on the tax deal saw gold take the biggest hit in seven months. The gross short jumped by a record 200% to reach 30,272 lots, a four months high. Silver fared even worse with the net-long returning to the five-year average after seeing a 61% reduction, not least due to increased short selling.  

Gold and silver speculative positioning
The copper net-long dropped to a six-month low following a one-third reduction. This followed the biggest one-day slump in more than two years last Tuesday. Technical selling was triggered by raised concerns about the short-term outlook for growth and demand from China.
Speculative positioning in COMEX Copper
Crude oil profit taking following the successful Opec+ meeting only triggered a 10,000 lots reduction of the combined net-long in Brent and WTI to 953,000 lots. The strong conviction resulting in money managers holding almost one billion barrels of speculative positions into the quiet end of year period is not likely to be challenged unless Brent moves back below $60/b and WTI below $55/b. 

Speculative positioning in Crude oil
Soft commodities were mixed with cocoa turning net-short again after just three weeks in the black. This in response to renewed and aggressive price weakness. Coffee was bought just before renewed weakness emerged after beneficial rain in Brazil boosted the potential crop yield and the BRL weakened on election jitters. 
Soft commodities

– Edited by Clare MacCarthy


Ole Hansen is head of commodity strategy at Saxo Bank

Download document

Commitments of Traders: Commodities


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail