NEW YORK: Hedge funds and money managers raised their bearish bets in U.S. gold futures and options close to a 7-1/2 year high, data by the Commodity Futures Trading Commission showed on Friday, a sign that short covering could boost bullion prices, analysts said.
In the week up to Dec. 3, the U.S. derivatives regulator said speculators cut their bullish bets in gold, and they turned silver into a net short position for the first time since late June. In addition, they trimmed their net shorts in the copper market.
Managed money increased their total shorts by 4,667 to 79,631 lots, slightly below a 7-1/2 year high of 80,147 set in the week of July 9, CFTC data showed.
In addition, the data showed managed money largely held their bullish bets steady, as total longs only eased 294 lots to 106,405.
On a net basis, the group reduced its net longs in gold for a fifth consecutive week, down by 4,961 lots to 26,774, its lowest level since July 2007, CFTC's Commitments of Traders (COT) report showed.
"Gold is at a critical inflection point right now - either it holds this year's lows and gold rebounds, or it could have a further pullback," said Adam Sarhan, chief executive at New York-based Sarhan Capital.
On Friday, gold edged up 0.3 percent to $1,228 an ounce, which put it in a striking distance to a three-year low of $1,180 an ounce reached in late June.
Speculators also turned silver futures and options into a net shorts of 5,386 lots, after cutting 6,096 lots of long position. It marks the first time silver was in a net short since the week of June 23.
On copper, they trimmed the market's shorts by 422 contracts to a net short of 19,316.
Traders said they now look forward to next week's CFTC data, which will show funds' positioning after this week better-than expected nonfarm payrolls report and the GDP data.
Among platinum group metals, speculators trimmed platinum's net length by 3,290 to 16,249 contracts, and they decreased palladium by 610 to a net long of 20,658 lots.
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