Gold: Sentiment Foreshadows A Reversal higher
Net-Short Exposure Expanded 57% Since Last Week
Spot Gold: Retail trader data shows 81.2% of traders are net-long with the ratio of traders long to short at 4.31 to 1. The number of traders net-long is 1.6% lower than yesterday and 8.0% lower from last week, while the number of traders net-short is 3.1% higher than yesterday and 57.5% higher from last week.
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Sentiment Suggests Gold Prices May Reverse
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Spot Gold prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current Spot Gold price trend may soon reverse higher despite the fact traders remain net-long.
Recommended Reading: Weekly CoT Sentiment Update for Major FX, Commodities, and Indices
--- Written by Jack Schwarze, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.