Gold Prices May have Turned versus the US Dollar
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Gold– A sharp drop in gold prices has led to a similarly pronounced shift in retail forex trader positioning, and our data suggests that the broader trend may have turned in favor of XAU/USD declines. Last week we noted that a notable majority of traders in our sample remained short Gold prices versus the US Dollar, but a clear wave of profit-taking leaves net-positioning almost exactly flat at time of writing.
We see little choice but to withdraw our calls for further XAU gains. Yet we would ideally see a sharp jump in retail FX trader buying before turning in favor of selling into any Gold price declines.
See next currency section: EURUSD - Euro Forecast to Fall even Further until this Changes
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.