Uncle Ti 88

Commitment of Traders Report Silver Vs ETFS Physical Silver Shares Chart I thought it might be interesting to impose the chart of the COT Silver Chart against a relevant instrument. We will take the ETFS Physical Silver Shares (SIVR) as the example. Do you see any correlation? It isn't that obvious isn't it? For those not familiar with ETFs, it is an access for those interested in trading or investing in Silver. The ETF try to mimic the movement of Silver prices. How exactly they do it, I am not really sure. There have been some problems with some ETFs. In some cases, the prices do not correlate with the underlying real instrument themselves / industries themselves.

SPDR S&P China - NYSE Want to know where the market in China is heading? The commercials aka " big boys" have been shorting the ETF since April 2011! Now the question is whether the selling will still go on or the price will rebound back-up... according to COT Proxy looks like the commercials are still shorting it... who will you follow? The commercials - "smart money" or  "dumb money"?

Now what do we do about other instruments that do not have the Commitments of Traders Report released like stocks, ETFs, etc? We can create our very own proxy! With this proxy you can see what the "commercials and speculators" are doing for stocks, ETFs and CFDs. I got to know about COT proxy when I attended Larry Williams trading course in Australia many years ago. Immediately saw the power of using it for trading any instruments without the real COT report. Now the question comes, how can we be certain the COT Proxy works exactly or closely as the real COT Report? To test this we have to compare it from the real COT to the COT Proxy in a side by side comparison. The move must be in unison. Let's see it in the next post!

The graph below shows the relationship between the commercials and the large speculators. They go the opposite don't they? When the commercials are long, the speculators are short and vice versa. Gold - Commitments of Traders Chart The commercials (producers) are producing and selling (short) and the speculators are buying (long) since 2002! Look where the price of gold is now. Even though the price has fallen in the last few weeks, the percentage remains the same. From here you can expect the price of gold to go higher! The sell-off is nothing but consolidation! People have been saying to sell gold now but that is not what the Commitments of Traders chart is telling us. It tells us to buy, buy, buy! On a side note, if you don't know how to invest in gold and don't want to hold onto physical gold, you can look at the SPDR Gold ETF. In Singapore, it is traded like a stock on the Singapore Stock Exchange (SGX).