Gold–Retail forex traders remain marginally net-short Gold versus the US Dollar (ticker: USDOLLAR), and our contrarian view of crowd sentiment leaves us in favor of short-term strength.
Trade Implications – Gold: Two weeks ago we wrote that the majority of retail traders turned short Gold prices for the first time since January, and that was an early warning sign that a short-term bottom was in place. .
We’ll nonetheless keep sight of the bigger picture. As tempting as it might be to buy in expectations of a minor bounce, long-term studies favor continued Gold price declines.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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