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Market News Hedge funds remain relatively neutral to gold! Short-term pressure, long-term still optimistic
Hedge funds remain relatively neutral to gold! Short-term pressure, long-term still optimistic
Hedge funds remained relatively neutral on gold, not taking any major bullish or bearish positions, according to the latest trading data from the CFTC from the U.S. Commodity Futures Trading Commission. Analysts have said that gold remains in a tug-of-war between rising inflation and a sharp rate hike by the Federal Reserve.
2022-06-14
10581
Despite the rise in volatility over the past few days, market analysts said that overall, the gold market is waiting for a catalyst to push it out of a tight trading range.
Hedge funds remained relatively neutral on gold, not taking any major bullish or bearish positions , according to the latest trading data from the CFTC from the U.S. Commodity Futures Trading Commission. Analysts have said that gold remains in a tug-of-war between rising inflation and a sharp rate hike by the Federal Reserve.
The Fed is on track to raise rates by 50 basis points later this week and repeat a similar move in July. However, inflation remains the main threat to the economy. The U.S. CPI rose 8.6% in May from a year earlier, hitting a 40-year high.
Marc Chandler, managing director at Bannockburn Global Forex, said recently: “The macro picture – the Fed and BoE will raise interest rates, and the ECB’s hawkish stance – could weigh on gold, but the inflation story could put gold bears off. "
Fund managers' total speculative long positions in Comex gold futures rose by 2,484 contracts to 115,215 contracts, according to the CFTC's itemized trader commitments report for the week ended June 7. Meanwhile, short positions fell by 4,254 contracts to 57,684.
Gold net longs currently stand at 57,531 contracts, up 13% from last week . Gold traded in a narrow range around $1,850 an ounce during the survey period.
Analysts at TD Securities warned that gold prices could fall further and could retest support around $1,800 as there are still many "complacent long positions" in the market.
“Net positioning in the gold market remains fairly sticky, with additional positioning added and moderate short covering,” the analyst said. A more prominent group of discretionary traders is reluctant to be fired as the Fed's path beyond September is unknown amid growing recession fears. Yellow holds despite a stronger dollar and rising interest rates Strong, but we still think gold will eventually capitulate to the Fed’s efforts to fight inflation.”
While gold prices may be headed lower, many analysts remain optimistic that over the long-term, gold prices may be headed higher . There are growing doubts about the Fed's ability to control inflation.
Ole Hansen, head of commodity strategy at Saxo Bank, said rising concerns over stagflation and further weakness in equities will continue to support gold prices .
" Gold has been relatively unchanged this year, but it continues to outperform U.S. equities , so I'm happy with its performance," he said. "If the Fed wants to get inflation under control, it's running out of time. I don't think they want to take any chances. Push the U.S. economy into recession."
Spot Gold Daily Chart
GMT+8 at 11:01 on June 14, spot gold was reported at $1826.85/oz
Hedge funds remained relatively neutral on gold, not taking any major bullish or bearish positions , according to the latest trading data from the CFTC from the U.S. Commodity Futures Trading Commission. Analysts have said that gold remains in a tug-of-war between rising inflation and a sharp rate hike by the Federal Reserve.
The Fed is on track to raise rates by 50 basis points later this week and repeat a similar move in July. However, inflation remains the main threat to the economy. The U.S. CPI rose 8.6% in May from a year earlier, hitting a 40-year high.
Marc Chandler, managing director at Bannockburn Global Forex, said recently: “The macro picture – the Fed and BoE will raise interest rates, and the ECB’s hawkish stance – could weigh on gold, but the inflation story could put gold bears off. "
Fund managers' total speculative long positions in Comex gold futures rose by 2,484 contracts to 115,215 contracts, according to the CFTC's itemized trader commitments report for the week ended June 7. Meanwhile, short positions fell by 4,254 contracts to 57,684.
Gold net longs currently stand at 57,531 contracts, up 13% from last week . Gold traded in a narrow range around $1,850 an ounce during the survey period.
Analysts at TD Securities warned that gold prices could fall further and could retest support around $1,800 as there are still many "complacent long positions" in the market.
“Net positioning in the gold market remains fairly sticky, with additional positioning added and moderate short covering,” the analyst said. A more prominent group of discretionary traders is reluctant to be fired as the Fed's path beyond September is unknown amid growing recession fears. Yellow holds despite a stronger dollar and rising interest rates Strong, but we still think gold will eventually capitulate to the Fed’s efforts to fight inflation.”
While gold prices may be headed lower, many analysts remain optimistic that over the long-term, gold prices may be headed higher . There are growing doubts about the Fed's ability to control inflation.
Ole Hansen, head of commodity strategy at Saxo Bank, said rising concerns over stagflation and further weakness in equities will continue to support gold prices .
" Gold has been relatively unchanged this year, but it continues to outperform U.S. equities , so I'm happy with its performance," he said. "If the Fed wants to get inflation under control, it's running out of time. I don't think they want to take any chances. Push the U.S. economy into recession."
Spot Gold Daily Chart
GMT+8 at 11:01 on June 14, spot gold was reported at $1826.85/oz
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