COT Silver Report (Sept 17–23, 2025)

Futures Only (COMEX)

Who’s who:

• Small Specs = retail/prop desks

• Large Specs = hedge funds, CTAs, macro momentum funds

• Commercials = bullion banks/swap dealers warehousing flow

Source for the above image is silverseek.com

Position Shifts (vs prior week):

• Large Specs (funds):

  • Longs: 72,318 (+0.97%)

  • Shorts: 20,042 (–0.21%)

  • Spreads: 18,048 (+14.2%) 🔥 big jump in basis/calendar trades

  • Net Long = +52,276 (up +738, +1.4%)

• Commercials (banks):

  • Longs: 42,281 (–1.9%)

  • Shorts: 115,036 (+0.46%)

  • Net Short = –72,755 (grew by –1,366, +1.9%)

• Small Specs (retail):

  • Longs: 33,158 (+2.3%)

  • Shorts: 12,679 (+1.0%)

  • Net Long = +20,479 (up +628)

• Open Interest: 165,805 (+1.75%)

👉 Read: Price up +$1.56 and OI up → new money entered.

Funds are dipping in net long, commercials leaned further short (warehousing demand), and spreads exploded higher → signaling serious positioning shifts beneath the surface.

🔹 Liquidity & Funding Stress

🔹 Silver & Gold Market Stress

🔹 Global Yield Stress

Source for the above image is silverseek.com

Futures + Options Combined (the bigger picture)

Position Shifts (vs prior week):

• Large Specs (funds):

  • Longs: 69,309 (+1.3%)

  • Shorts: 19,802 (+0.8%)

  • Spreads: 55,052 (+20.4%) 🚨

  • Net Long = +49,507 (down –7,468, –13%)

• Commercials (banks):

  • Longs: 53,686 (+2.5%)

  • Shorts: 124,159 (+1.8%)

  • Net Short = –70,473 (up –844, +1.2%)

• Small Specs (retail):

  • Longs: 37,621 (+2.1%)

  • Shorts: 16,656 (+4.2%)

  • Net Long = +20,965 (down –113)

• Open Interest (combined): 215,668 (+6.1%) 

👉 Read: The real story is in spreads: +9,364 (20% jump).

This is swap dealers and funds repositioning hard — volatility hedges, roll structures, and basis trades are surging. Meanwhile, commercials nudged short again, but not aggressively.

Connecting the Dots

• Funds: Hedge funds & CTAs are cautiously pressing long, but the massive spread ramp shows they’re also preparing for volatility to explode.

• Commercials (bullion banks): Added to shorts modestly → this is risk warehousing, not an “attack.” They’re matching client flow.

• Retail/small specs: Staying long, trickling in more size.

Big Picture:

• Open interest surged +12,375 contracts combined (+6.1%) while price ripped from $42.87 → $44.44.

• That means this rally isn’t just shorts puking — it’s fresh capital flowing in.

• And now? Price at $47.11 confirms those positions are already deep in profit, which pressures shorts even more.

💡 Translation: We’ve entered the classic setup where:

1. Funds are long + spreading volatility bets

2. Banks are warehousing risk but leaning short

3. Retail is chasing higher

4. Price is detonating upwards in real time

This is the anatomy of a market breaking free from its paper shackles. The shorts aren’t “managing” anymore — they’re being overrun.

SOFR vol (overnight funding volume) just ripped to another record high at $2.965T, which screams one thing: the system is leaning on more leverage than ever to keep liquidity flowing.

That fragility isn’t doom—it’s the setup for explosive asymmetry, because when the plumbing rattles this hard, gold and silver are the natural release valves.

Reverse repos finally bounced off the floor at quarter-end, hinting at rotation into volatility (watch the VIX), while SLV borrow stress at 2.16% with only 600K shares left shows sourcing physical silver remains a knife fight.

And what’s silver doing in the middle of all this? Absolutely ripping higher with conviction—volume, open interest, and price all surging in tandem, a signature of fresh inflows rather than just shorts covering.

Gold is being pulled into the slipstream too, with heavy volumes confirming it’s joining silver’s momentum. The lesson is simple: we can’t control systemic fragility, but we can position where that pressure has to escape. Right now, that escape valve is precious metals—and silver is leading the charge.

168 rate cuts in a single year isn’t stimulus — it’s desperation.

Every cut makes debt cheaper, which means more borrowing, more leverage, and an even bigger avalanche of obligations that can never be repaid in real terms.

That debt spiral forces central banks to print, expand money supply, and quietly dilute every dollar, euro, and yen in circulation. This is a global race to the bottom — currencies competing to devalue faster just to keep their economies afloat.

And when fiat melts down like this, there’s only one way capital can preserve itself: by flooding into real money. Gold and silver aren’t going higher because of hype — they must go higher, mechanically, as the denominator (currency) gets debased. This isn’t a trade — it’s the safety valve for the entire system.

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Luke Lovett
Cell: 704.497.7324
Undervalued Assets | Sovereign Signal
Email: [email protected]

Disclaimer:
This content is for educational purposes only—not financial, legal, tax, or investment advice. I’m not a licensed advisor, and nothing herein should be relied upon to make investment decisions. Markets change fast. While accuracy is the goal, no guarantees are made. Past performance ≠ future results. Some insights paraphrase third-party experts for commentary—without endorsement or affiliation. Always do your own research and consult a licensed professional before investing. I do not sell metals, process transactions, or hold funds. All orders go directly through licensed dealers.