Last time hedge funds were this bearish, the gold price was $700

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at $1,262.20 an ounce during early afternoon dealing, up over $30 from the $1,237.40 low struck shortly after the opening, but off the day's high of $1267,50.

Silver tracked gold's trading pattern, jumping more than 3% to a day high of $20.32, crossing the $20-level for the first time since 20 November.

Retail buying interest in precious metals came after data from US Commodity Futures Trading Commission showed hedge funds are now the least bullish on the yellow metal since 2007 when gold averaged around $700 an ounce. So many large players short of gold could translate into further upside for the metal as commercial traders are forced to cover their positions.

Net-long positions – bets that the price will rise – fell by 16% to a mere 26,774 contracts last week data from Danish investment bank Saxo shows. Around 150,000 futures contracts are traded in gold each day.

Read More: www.mining.com/the-last-time-hedge-funds-turned-this-bearish-the-gold-price-was-700-75255/