COT: Gold long cut by one-third as yield and dollar pop COT: Gold long cut by one-third as yield and dollar pop COT: Gold long cut by one-third as yield and dollar pop

COT: Gold long cut by one-third as yield and dollar pop

Ole Hansen

Head of Commodity Strategy

Summary:  This update highlights futures positions and changes made by hedge funds across commodities, forex, bonds and stock indices up until last Tuesday, January 12. A week that dealt with a sharp rise in bond yields and a stronger dollar on the rising prospect for a US stimulus bazooka. Gold ended up being the biggest casualty of these developments with speculators cutting their gold long by almost one-third to the lowest since June 2019

Saxo Bank publishes weekly Commitment of Traders reports (COT) covering leveraged fund positions in commodities, bonds and stock index futures. For IMM currency futures and the VIX, we use the broader measure called non-commercial.

The below summary highlights futures positions and changes made by hedge funds across commodities, forex, bonds and stock indices up until last Tuesday, January 12. A week that dealt with a sharp rise in bond yields and a stronger dollar on the rising prospect for a US stimulus bazooka after the Democratic party secured a Senate majority. US ten-year bond yields jumped 17 bp to 1.13% while the dollar and stocks both rose. Gold, not surprisingly, ended up being the biggest casualty with speculators cutting their gold long by almost one-third to the lowest since June 2019. 


The commodity sector was mixed with the Bloomberg Commodity Index adding 0.4% on top of the strong gains seen during the first days of January. The rally however became very uneven with rallies in energy and grains being partly offset by tumbling metals and soft commodities. As a result of this speculators ended up holding a near unchanged long, measured in number of lots, across the 24 major futures contracts tracked in this. The nominal exposure meanwhile declined by $8 billion to $128 billion, primarily due to a near one-third reduction in the gold long representing a value of $8.6 billion.


Energy: The tailwind from the surprise Saudi production cut saw speculators increase crude oil longs in WTI and Brent by 43.4k lots to 667.4k lots, a one-year high. The net has now almost doubled since the early November vaccine announcement which helped increase hopes for a return to normal fuel consumption. A hope that is currently being challenged by continued and prolonged lockdowns across key consuming nations. 

Latest: Crude oil (OILUSFEB21 & OILUKMAR21) trade softer but so far without breaking any significant levels. Hopes about a speedy recovery in fuel demand continues to be challenged by lockdowns and the continued rapid spreading of Covid-19. Focus this week on IEA’s Oil Market Report Tuesday and Biden’s inauguration and how soon he can roll out his fiscal stimulus plan. Support in Brent at $54/b the trendline from the November low.

Precious metals led by gold saw a dramatic reduction in net longs after speculators were spooked by the surge in ten-year bond yields above 1% and a stronger dollar. The 13 bp jump in real yields, a key driver for gold, and the accompanying slump back below $1900/oz helped trigger a 31% reduction in the net long to 105k lots, almost the smallest bet on rising prices since June 2019. Despite weakening by 8%, the silver long was left relatively unscathed as the net-long was reduces by 9% to 43k lots, a six-week low.

Latest: Gold (XAUUSD) and silver (XAGUSD) extended their Friday slump on the Asian opening before bouncing strongly to trade higher on the day. On top of last week’s dollar and yield strength a comment from incoming Treasury Secretary Yellen, that the administration is not seeking a weaker dollar, further spooked the market in early trading. However, with real yields back below –1%, the short-term outlook hinges on the dollar with gold facing resistance at $1855/oz.

Grains: Ahead of last week’s WASDE report which triggered another upside price extension led by corn, speculators had reduced longs in soybeans and wheat while increasing the corn long to a ten-year high at 374k lots. Overall the total sector long which include meal, oil and KCB wheat was cut by 12k lots to 790k lots, the first reduction in six weeks.

Latest: US trade grains and soft commodity markets are closed today for Martin Luther King Jr Holiday. Once the markets reopen they will continue to focus on the price impact of Argentina's decision to suspend corn shipments and Russian plans to impose export duties on grains in order to curb rising domestic food prices triggered by the Covid-19 crisis. 


The rising yield-led rise in the dollar during the week to January 12 was met by fresh selling from speculators. Against ten IMM currency futures and the Dollar Index, the combined short rose by 12% to $36.2 billion, a level not seen in almost ten years. The Greenback was sold against all but one of the ten currencies tracked in this. The bulk of the change being the 12,899 lots increase in the EUR net long to 156k lots or €19.5 billion. Multi-month highs were seen in JPY, NZD and BRL.

What is the Commitments of Traders report?

The COT reports are issued by the U.S. Commodity Futures Trading Commission (CFTC) and the ICE Exchange Europe for Brent crude oil and gas oil. They are released every Friday after the U.S. close with data from the week ending the previous Tuesday. They break down the open interest in futures markets into different groups of users depending on the asset class.

Commodities: Producer/Merchant/Processor/User, Swap dealers, Managed Money and other
Financials: Dealer/Intermediary; Asset Manager/Institutional; Leveraged Funds and other
Forex: A broad breakdown between commercial and non-commercial (speculators)

The reasons why we focus primarily on the behavior of the highlighted groups are:

  • They are likely to have tight stops and no underlying exposure that is being hedged
  • This makes them most reactive to changes in fundamental or technical price developments
  • It provides views about major trends but also helps to decipher when a reversal is looming



The Saxo Group entities each provide execution-only service, and access to analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular, no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.

Saxo Markets
88 Market Street
CapitaSpring #31-01
Singapore 048948

Contact Saxo

Select region


Saxo Capital Markets Pte Ltd ('Saxo Markets') is a company authorised and regulated by the Monetary Authority of Singapore (MAS) [Co. Reg. No.: 200601141M ] and is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Risk Warning to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as Margin FX products may result in your losses exceeding your initial deposits. Saxo Markets does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Markets does not take into account an individual’s needs, objectives or financial situation.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website are not intended for residents of the United States, Malaysia and Japan. Please click here to view our full disclaimer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.