Gold Price Outlook Remains Bullish until this Changes
Why and how do we use the SSI in trading? View our video and download the free indicator here
Gold– Retail FX traders have sold aggressively into recent Gold price strength, and a contrarian view of crowd sentiment favors a XAU/USD rally onto fresh highs. It’s important to note that this isn’t the first time we’ve called for a breakout; the ‘crowd’ has turned decisively net-short gold prices at a handful of key XAU/USD tops in the past three months. And indeed there’s no way to know whether this is yet another instance in which traders turn short into market reversals.
A sustained shift towards selling would nonetheless keep us bullish, and a run towards yearly highs remains likely until the opposite occurs and crowds begin buying.
See next currency section: DAX - German DAX Likely to Hit Fresh Highs
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up for his distribution list via this link.
Contact David via Twitter at http://www.twitter.com/DRodriguezFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.