Barrick accelerates unhedging its gold positions

Barrick Gold, the world's largest gold producer, announced last month it was removing its hedge positions over the next year, as the hedges were dampening profitability in an environment of higher gold prices. In a Bloomberg interview, Barrick's CFO said it plans to accelerate the de-hedging strategy, buying back gold bullion and closing out short positions.

http://www.reuters.com/article/basicMaterialsSector/idUSL272564320091102

Translation: one the world's biggest gold shorts (at least they produce gold, instead of naked shorting it) is not just walking away, but RUNNING FOR THE EXITS, in anticipation of higher gold prices.

I wonder what the naked shorts at JPMorgan and HSBC are thinking right now. Hint: expect open interest (new short contracts) to explode over the next several days, as the shorts double down in an attempt to surreptitiously suppress COMEX gold and silver.

Either that, or the shorts will get trampled, which is an eventuality. A COMEX "failure to deliver" will occur within the next few years, but these IMF gold sales may ultimately leak back into the open market, causing a temporary decline. But there are just too many institutional and retail buyers worldwide to sustain a meaningful correction. The secular bullish trends in gold and silver are still intact.

Good luck to all.

Gold chart

http://www.the-privateer.com/chart/gold-pf.html

The chart for gold still looks bullish, with support at $975, and $875, should $975 not hold. In other words, the long-term bullish trend is in place unless support levels are broken. Either way, expect violent corrections, as the commercial shorts vigorously attempt to put a lid on prices.

The short USDollar / long precious metals trade is getting crowded, so corrections won't be unexpected.

Disclaimer: this chart only depicts previous price levels, and does not indicate future performance. Investing is risky, so consult with your professional investment advisor. Do your own due diligence.

Disclosure: I am long physical gold and silver, and long gold and silver mining shares.