Did We Just Hit The Threshold For Short Covering In Gold?

"Two weeks ago we noted something that has never happened before in gold - hedge funds, according to CFTC, had a net short position for the first in history. The past week saw a very surprising negligible shift of just 11 contracts as the short position shrank to 11,334 contracts. However, the aggregate net long position has dropped to a level that in the past has represented athreshold for signficant short-covering (21% and 17% rallies respectively). So with hedgies as short as they have ever been in history and aggregate positioning at a historically crucial level, one wonders if gold is due for a bounce...

Hedgies remain the most short they have ever been in gold...

This is what happened the last time gold saw a 'low' net long position...

and now, the aggregate net position in gold futures appears to have hit a threshold that in the past has created a significant short-covering rally...

The last 2 times aggregate net long positions were this low, gold rallied 21% and 17%...

Did we just reach that short-covering threshold once again?"

at http://www.zerohedge.com/news/2015-08-01/did-we-just-hit-threshold-short-covering-gold