Gold: Uptrend remains intact – TD Securities

According to analysts from TD Securities,  it seems that there was long liquidation of recently accumulated relatively "weak" positions near $1,500-1475/oz and they see that there are no broad changes in hedging activity or speculative activity, suggesting that current price dynamics may not be sustainable.

Key Quotes: 

“Despite little change in the macroeconomic narrative, gold has come under pressure as prices broke through key technical levels, including the uptrend channel formed from the summer lows and more recently as prices broke through $1480/oz support.”

“The combination of some 75 technical analysis trading signals suggests that 43% of signals are still tilted towards the long side in gold. In fact, chart signals in gold present the most compelling case in the cross-asset basket of securities tracked herein, with the yellow metal holding the crown for the highest absolute percentage of signals pointing long on a 60d moving average basis.”

“This lens suggests that prices are being pressured by extremely skewed positioning as the marginal chart signal prompts a herd of gold bulls to reduce their net length. However, our positioning analytics suggest that the weakness in prices is more likely to be driven by a minor shakeout in length than any major changes in positioning, given that most length is still comfortably sitting on hefty profits.”

“Overall, this suggests that these liquidations are unlikely to represent a substantial portion of the net length accumulated throughout the last year, as we estimate that the weighted average entry price for gold longs stands around $1420/oz, which remains well below current prices and is a robust support level.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD: Bullish case underpinned by weekend news

The EUR/USD pair has rallied Friday to close with gains for a third consecutive week at 1.1169. There was no particular catalyst for EUR gains. ECB scheduled to meet this week, although no fireworks expected this time.


GBP/USD: Uncertainty or relief? Action granted anyway

Hopes that the UK will avoid a hard-Brexit kept the Pound rallying against all of its major rivals by the end of last week, with GBP/USD finishing it a handful of pips below the critical 1.3000 level.


USD/JPY: Corrective slide to continue on sentiment

The USD/JPY pair closed the week at around 108.40, down Friday for a third consecutive day as the American currency remained under selling pressure. USD/JPY at risk of falling further only if it breaks below 108.00.


Gold turns flat above $1,490 as USD remains under pressure

After dropping to a daily low of $1,485, the XAU/USD pair staged a modest rebound during the American trading hours and turned flat on the day near $1,492.

Gold News

China’s downward economic path offers no escape from its trade problems

There were no surprises in China’s GDP figures as the government portrays an economy slipping steadily lower giving little promise of improvement or support for the waning global expansion.

Read more