High deficits, slowing growth, fears of sticky inflation, currency devaluation, and an imminent cutting cycle worldwide are all reasons to explain the current spike in Gold prices.
But traders might be going too far, TDS Senior Commodity Strategist Daniel Ghali notes. Downside risks have grown got Gold “What if we argued these narratives had already attracted significant inflows into Gold markets? Our gauge of macro fund positioning in Gold has scarcely been higher than it is today. In fact, it is statistically consistent with 370bps of Fed cuts.
” “Commodity Trading Advisors are 'max long', and Shanghai trader positioning has reverted to record highs. Few visible shorts remain in the market. Positioning cues are flashing red in Goldmarkets. And while the fundamental narratives that drive Goldare bullish, narratives ultimately chase prices.
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