The latest banker’s participation gold report covered holdings as of Dec. 1, 2013 with PoG at 1251. The US bullion bankers reduced their shorts by about 1,177,000 ounces, and ended the period with net longs of nearly 5.75 million ounces, another record. Their short position is a very modest 14,489 contracts versus a whopping 71,897 longs.

The foreign bankers were even more active in short covering, reducing from 58,486 to 39,547 contracts and increasing longs by about 6,000.  Simply put, the bullion bankers are loaded to the gills with paper gold.

Source: CFTC

The latest CoT for Dec. 24th showed the managed money slingers holding a record 82,765 contracts short. That is 8,276,500 ounces of gold they don’t have.  Small speculators were unusually active in the week adding 170,700 ounces in naked gold “supply” aka shorts that they don’t have either.  Yes, simply put speculators are loaded to the gills with even more naked paper shorts.

Producers added 954 longs to take their position back up to a record of close to 1.2 million ounces.

The Comex paper market were barely trading all week, but that didn’t stop some inexplicable swoon Monday on about 1/3 of recent low volume. There were no particular signs of slingers, but the market was pushed $16-18 lower on what appeared to be half dozen like contract sales.  I watched for awhile and didn’t see anything much larger than 25 contract trades. Volume in GLD was about 60% of normal. Perhaps this is some last minute window dressing?  Bulliondesk.com called it (before it happened when gold was at 1206) as moronic funds “tidying up of their books” in a super thin market.  I guess that’s why they get paid the big bucks?

“Not much is happening out there but we could see some fund managers rid themselves of some gold in an attempt to tidy up their books before the close of the year. And because volumes are so low we could see some strange vacillations – a slip back below $1,200 is possible, which would trigger technical selling,” a US-based gold trader said.

Monday’s GLD spider extraction was about 106,000 ounces.   Shanghai too is still in holiday mode, but managed to deliver 6958 kg last night or 245,445 oz.  Shanghai Gold Exchange is closed January 1-3, and then will head into the seasonal strong Chinese New Year period.