Founders Gold Comment for Next Week

It's On Our Radar again

***NO ZOOM DISCUSSION. HAPPY MEMORIAL DAY***

Guys,

Am out of town this weekend and unable to assemble stuff like normal. So unable to meet for a chat. So here is something on open interest as the market is selling off to look for, as it is now on my radar.

We are in the disinvestment phase of a bull run now. That means direction, as always, will be primarily dictated by fund longs getting out at first, then possibly fund shorts getting in. Therefore, in most of a selloff, open interest should decrease as they puke and the banks get to cover their shorts lower.. That is happening now.

Then, at some point , the volume of longs getting out will start to taper off, and so the market drops should (ideally) also taper off.

Then one of 2 things in general happens. Either we go sideways and wait for news and/or a new cycle, or the short-playing funds (the biggest Gold idiots who lose money 99% of time, but when they are right make a ton of money) start to pile in. Sometimes both happen overlapping.

That behavioral explanation of flows is extremely accurate, but not precise at all. Once the short funds start playing, the data gets muddied and you either have to literally see who is selling¹ or have a technical indicator you prefer that helps you decide when overbought/oversold is near.

When the OI no longer confirms the moves, the opportunity arises.. but the timing is not obvious using my methods. So it’s now time to pay attention.

Continues including CFTC COT, CTA data reports, Hartnett, and more