Funds have become less bullish on silver. That does not mean they reduced their bets on rising prices last week.
According to the CFTC’s futures-only report, Managed Money held 16,180 long contracts against 12,675 shorts as of October 20. That left a net long position of 3,505 contracts, approximately 38% below the previous week.
How that decline happened is the crucial detail:
- Long positions increased by 378 contracts.
- Short positions increased by 2,492 contracts.
Net bullish exposure fell because shorts grew faster. The number of longs actually increased slightly.
We would therefore be careful about claiming that fewer bullish positions remain available for forced liquidation. A lower net figure alone does not establish that. One fund’s short position does not protect another fund from losses on its longs.
If silver falls further, long holders could face margin calls and pressure to sell. COT data do not disclose their entry prices, financial reserves or stop-loss levels. These figures therefore cannot tell us how much additional forced selling might follow.
That is why we examine longs and shorts separately in our Gold & Silver COT Positioning Tracker.
The date matters too: the report captures positions held on Tuesday, October 20, before the sharp declines later that week.
Our reading is that the latest figures primarily show growing willingness to bet on further losses. Some investors continued adding bullish exposure, but bearish positions expanded considerably faster.
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