We’re just a few days into the new year. How are resolutions going?
Mine are going fantastic!
I didn’t make any.
Please note: the CoTs report was published 12/30/2022 for the period ending 12/27/2022. “Managed Money” and “Hedge Funds” are used interchangeably.
Gold finished the year on a strong note, with Managed Money reaching a net-long position of 50k. This is the largest net long position for Managed Money going back to June 2022.
The Fed has a targeted balance sheet reduction of $95B a month. After reaching and exceeding this target last month, the Fed is back to undershooting.
This should not come as a surprise given the turmoil in the bond market this year and the lack of liquidity.
This analysis typically starts with gold, but the activity in platinum is a major event that should not be overlooked.
See the article What is the Comex? for a bit of backstory.
The Federal Reserve is trying to win a war against price inflation without tipping the economy into a recession. In this episode of the Friday Gold Wrap, host Mike Maharrey highlights two more reasons this is a game the Fed can’t win. He also does a quick overview of the gold market in 2022 as we head toward the end of the year.
Peter Schiff recently said he is very bullish on gold in the year ahead.
Obviously, I’ve been bullish for a while. But I’m even more bullish now to the extent that’s possible, based on what’s been happening.”
Peter is not alone. Doug Casey also thinks 2023 will be “the year for gold.”
The 13-week annualized non-seasonally adjusted money supply growth rate is crashing at a time when it typically moves up. The market is becoming increasingly more vulnerable to a major event in the weeks or months ahead. Let’s take a look at the data…
Peter Schiff recently appeared on Kitco News and chatted with anchor David Lin. Peter gave his outlook for inflation, stocks, and gold in 2023. Peter said we had better get prepared for an inflationary depression. He also emphasized that he is very bullish on gold in the year ahead.
While the price analysis last month was very neutral, the data this month points to a bit more positive momentum in the gold and silver markets.
Last month I highlighted that gold was trapped between long-term support and resistance.
December gold is having the weakest major delivery month since February. This is surprising given the recent strength in gold and considering that last December saw quite a large number of contracts deliver (36k). I commented on this a few weeks ago, suggesting that the lower volume was a result of thinner supplies. I think the silver shortage is well underway and it is just starting in gold. This is why gold is showing signs that silver showed 6-12 months ago.
