Post by
MaterialsMan on Nov 17, 2023 7:37am
Backwardation
Could this be what we have been waiting for?
I found myself curious as to why gold futures for November are selling near to or slightly below the spot price today.
Not being an expert in these matters, I relied on google to help me try to understand this phenomenon.
From what I can ascertain, one of the reasons for backwardation takes place when demand for the underlying commodity outstrips the availability. In this case, physical gold.
This scenario can get pretty complicated.
While researching, I came across words like manipulation, temporary shortages, etc.
Perhaps someone on this board that knows a lot about futures trading could contribute a clearer understanding.
Comment by
Symbiotic on Nov 17, 2023 11:56am
Alchemy of intstrument not alchemy of element and the developing stresses in the differential between. Harbinger of rectification to the truthfull.