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“Tom writes in that he’s been reading about naked shorts on silver at the COMEX and how it drives down silver’s price. “Is it possible for you to include in your reports a brief summary of the net long and short positions for the silver and gold traders on the COMEX? Your readers would find it most interesting.”
Well, Tom, that information – it’s called Commitment of Traders reports, a lot of people cite it – is useless information. There are so many games that can be played with that information that it’s just entirely useless and it changes by the day and it is of no value when making trading decisions. The only thing you need to know is that when there’s a lot of open shorts in any market, whether it’s Facebook or silver, is that those shorts eventually have to cover which gives the market the energy to turn around and start a new bull market and vice versa for lots of open longs. Eventually they have to take profit and that causes a correction. That’s all you need to know. Monitoring the commercials and the small speculators and the Commitment of Traders reports, they’re really useless. I did it in the ’80s. I got no value out of it whatsoever. Most analysts don’t even look at them anymore.”