COT Report Data for Silver Futures

Silver prices have been following gold's lead, pushing up to new all-time highs in 2025.  Silver's chart is a great picture of an uptrend, and you only want to fight an uptrend if you have a really good reason.  Some data from the latest COT Report might be that reason.

The Commitment of Traders (COT) Report is published every Friday by the CFTC.  It lists the quantities of futures contracts held by different groups of traders.  The latest COT Report had 332 different types of futures contracts listed.  A lot of those are obscure energy contracts; there are 12 different propane futures contracts, for example.  They break down the positions held into 3 categories of traders:

• Commercial traders are ones who use the subject commodity in their trade or business.  These can be big consumers, like Archer Daniels Midland for wheat as an example.  They can also be producers, using the futures market to lock in pricing for their future production.  The commercials are usually the smart money.
• Non-commercial traders are large speculators, so think of hedge funds.  To qualify for this category, a trader needs to hold a certain number of contracts (it varies by contract), and not be a commercial trader.
• Non-reportable traders are the small speculators, whose position sizes are so small that the CFTC figures they are not worth tracking individually.  These are usually the hot money traders, who chase every up move and flee every dip.

The chart above shows the net position of the commercial category of silver futures traders.  Because a lot of the commercials in silver are producers, this group's net position is skewed to the short side most of the time.  So the game for the analyst is to evaluate each week's net position relative to recent data.  In that respect, what we are seeing now is a big topping indication for silver prices.  As a group, they are holding one of the largest net short positions in years.

Every futures contract is simultaneously 1 long position and 1 short position, each held by different parties.  So overall, there will always be an exactly equal balance between longs and shorts.  It can never be otherwise.

But not all traders are equal, and some are smarter than the others.  That's where doing an analysis of the COT Report data can be so useful.  Right now, the smart money commercials are net short as a group, but they are almost always net short.  What matters is that they are net short to a HUGE degree.

At the opposite end, the large and small speculators are skewed to the long side, holding the other side of the commercials' imbalanced positions.  This next chart shows the net position of the small non-reportable traders.

This group is almost always net long to varying degrees.  There was one and only one time in history that this group actually went net short as a group, and that was at the exact price bottom in 2001.

The latest data show this group at a fairly big net long position, not the biggest ever, but it is up there.  And perhaps more importantly, these small traders have been moving aggressively to get even more net long over the past 2 weeks, even though prices have not done much to justify that change in position.  In other words, they are adding to their longs on pure bullish sentiment as opposed to a change that was actually induced by price action.

These two charts convey the message that this is not the best time to be a buyer of silver.