Market News Sentiment is turning bullish as hedge funds sell gold near limit
Sentiment is turning bullish as hedge funds sell gold near limit
Hedge funds continued to reduce long exposure to gold, according to the latest data from the U.S. Commodity Futures Trading Commission (CFTC). Analysts, however, pointed to a shift in sentiment as gold rebounded from support below $1,800 an ounce.
2022-05-24
11726
Hedge funds continued to reduce long exposure to gold, according to the latest data from the U.S. Commodity Futures Trading Commission (CFTC). Analysts, however, pointed to a shift in sentiment as gold rebounded from support below $1,800 an ounce.
Gold prices will rally higher in the near term as bearish sentiment approaches extreme levels, said Peter Grosskopf, CEO of Sprott.
"Gold has been washed enough, so I can safely say that as sentiment picks up, the price of gold should move higher," he said. "Gold continues to play a role and is again a great risk-averse asset ."
Fund managers cut their total speculative long positions in Comex gold futures by 8,359 to 123,931, according to the CFTC's itemized trader commitment report for the week ended May 10. Meanwhile, short positions rose by 10,273 to 72,212.
Gold net longs now stand at 43,360 contracts, down 30% from the previous week. Gold net longs fell to an eight-month low. Gold prices fell to a four-month low of $1,785 an ounce during the survey period before recovering.
"According to the CFTC, speculative financial investors have withdrawn further ... net long positions have fallen to the lowest level since last September," said Daniel Briesemann, precious metals analyst at Commerzbank. "However, in our view, this should have The market has adjusted, which means that the selling pressure generated by this group of investors should have subsided significantly .”
However, some analysts are not convinced that the gold market has bottomed.
"But looking ahead, gold's path of least resistance remains low, given that the Fed appears willing to sacrifice some economic growth to keep inflation in check," said analysts at TD Securities.
Ole Hansen, head of commodity strategy at Saxo Bank, said that while sentiment is shifting, the gold market still has some technical hurdles to overcome. For gold to become more favorable to investors, it will need to break the next major hurdle at $1,868 , which is the 38.2% retracement of the recent pullback at $210. "
Spot Gold Daily Chart
GMT+8 at 13:48 on May 24, spot gold was reported at $1854.95/oz
Gold prices will rally higher in the near term as bearish sentiment approaches extreme levels, said Peter Grosskopf, CEO of Sprott.
"Gold has been washed enough, so I can safely say that as sentiment picks up, the price of gold should move higher," he said. "Gold continues to play a role and is again a great risk-averse asset ."
Fund managers cut their total speculative long positions in Comex gold futures by 8,359 to 123,931, according to the CFTC's itemized trader commitment report for the week ended May 10. Meanwhile, short positions rose by 10,273 to 72,212.
Gold net longs now stand at 43,360 contracts, down 30% from the previous week. Gold net longs fell to an eight-month low. Gold prices fell to a four-month low of $1,785 an ounce during the survey period before recovering.
"According to the CFTC, speculative financial investors have withdrawn further ... net long positions have fallen to the lowest level since last September," said Daniel Briesemann, precious metals analyst at Commerzbank. "However, in our view, this should have The market has adjusted, which means that the selling pressure generated by this group of investors should have subsided significantly .”
However, some analysts are not convinced that the gold market has bottomed.
"But looking ahead, gold's path of least resistance remains low, given that the Fed appears willing to sacrifice some economic growth to keep inflation in check," said analysts at TD Securities.
Ole Hansen, head of commodity strategy at Saxo Bank, said that while sentiment is shifting, the gold market still has some technical hurdles to overcome. For gold to become more favorable to investors, it will need to break the next major hurdle at $1,868 , which is the 38.2% retracement of the recent pullback at $210. "
Spot Gold Daily Chart
GMT+8 at 13:48 on May 24, spot gold was reported at $1854.95/oz
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