Leading commodity strategist Daniel Ghali from TDS notes that Commodity Trading Advisors (CTAs) are making a comeback in Gold markets.
Asia’s Buyer’s Strike Impacts Gold Prices
According to Ghali, systematic trend followers are expected to reduce their positions by up to -15% in the current session. This could lead to a decrease in Gold prices despite a recent rally. The potential deleveraging and deteriorating trend signals are contributing to this shift.
CTAs’ positions in Gold are now at risk of a significant downturn, with algorithms possibly selling up to 60% of their long positions in the coming week. Additionally, macro funds and Shanghai traders are showing vulnerabilities, with Asia remaining cautious in its buying activity. This scenario could result in a surge of selling in the Gold market.
Analysis: How This Affects Your Finances
If you’re an investor in Gold or related markets, it’s important to be aware of the potential impact of CTAs’ return and the buyer’s strike in Asia. The selling pressure from systematic trend followers and other market players could lead to a decrease in Gold prices. This could affect your investment portfolio and overall financial strategy. Stay informed and consider adjusting your positions accordingly to navigate these market dynamics effectively.
