I'm not smart enough to determine if you can use short selling as a leading indicator for price movement.
But here's my thinking.
A high volume of short selling means the company is under significant pressure. This is either justified or unjustified by the reality facing the company.
At present, the volume of short selling in BDR is roughly equivalent to the junior Iron Ore miners. Those guys are stuffed. There's an avalanche of new supply coming from the majors which will wipe them off the face of the earth. The BDR position is quite different. Yes their AISC last quarter was >$1100US, but that will come down significantly as production comes up. The company's upper estimate of $850US seems reasonable for a longer term average. There's no avalanche of new supply of gold coming onto the market - indeed there isn't a heap of investment in new supply. The short selling in BDR seems unjustified. Explicable because last quarter's AISC is close to the POG but unjustified taking everything into account.
I also think that the production number for the third quarter will come out ahead of the sales number pre-released. It seems intuitive that when production is slowing, sales will come out ahead of production as there is less gold in circuit at the end of the quarter than at the start. That was the case in the 2nd quarter when sales were 36K oz and production was 30K oz. But with production having increased in Q3, I expect the production number to come out ahead of the 41Koz sales number.
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