The COT Reports for Comex Gold (futures & options) showed that as of Tuesday, August 7th, the Commercials were net short only 8,235 contracts, having liquidated 97.38% of their peak short position of -315,365 contracts back on January 23, 2018.. This is the largest liquidation of their peak short positions since 2003, even greater than their liquidation of 95.91% on Tuesday, December 1st, 2015!

My friend, the futures encyclopedia and technician says: “If the market doesn’t bottom when commercials liquidate their shorts, have they ever been net long? They have, and these are the peak positions. (In Oct 2003 I switched to include options so this list the futures only. My data starts in 1998) The average from the 5 observation is 65,871 net long.”

51,220 3/1998
76,329 9/1998
91,690 4/1999
42,590 5/2000
67,526 2/2001

*Correction* The chart above should say “The last time period when the Commercials on the Comex were HEAVILY Net Long Gold”. Commercials include others than just producers (miners) such as fabricators and jewelers who could be long to protect themselves from rising cost of the metal they need. The time period highlighted by the green rectangle shows the PEAK Net Long Gold Positions of the Commercials on Comex Gold. They could have been Net Long a smaller number of contracts for some years earlier in what was a seemingly endless Secular Bear market for gold.

The corrected chart is below: