Gold Price Trend May Soon Reverse Higher per Sentiment
NET-SHORT POSITIONS INCREASED BY 14% FROM LAST WEEK.
Spot Gold: Retail trader data shows 73.0% of traders are net-long with the ratio of traders long to short at 2.71 to 1. The number of traders net-long is 7.6% lower than yesterday and 4.7% lower from last week, while the number of traders net-short is 9.8% higher than yesterday and 14.0% higher from last week.
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Change in Positioning Favors Potential Reversal
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.
--- Written by Nancy Pakbaz, CFA, DailyFX Research
Follow Nancy on Twitter @NancyPakbazFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.