Gold Price Forecast: There are no XAU/USD shorts in sight – TDS

As strategists at TD Securities note, it is striking how traders short in gold have plunged considering that markets are pricing a hawkish Federal Reserve. However, this environment poses some risks for the yellow metal.

Where did all the shorts go? 

“Our dry-powder analysis highlights that the breadth of traders short in gold has shrunk towards its lowest levels on record. This is a striking change from just a few months ago, when sentiment in the precious metals complex was pervasively negative, with short positioning bloated at lower prices.” 

“Gold bugs appear to be ignoring a hawkish Fed and embracing a safe-haven asset for protection against the fog of war.”

“Strong physical demand is also likely both directly and indirectly associated with the war and its inflationary impact.”

“This set-up also leaves gold vulnerable to a de-escalation in the war or a change in the market’s focus as the fear trade subsides, especially given that there are no shorts in sight.”

EUR/USD holds above 1.0900 ahead of FOMC Minutes.EUR/USD has extended its daily rebound toward 1.0950 in the early American session on Wednesday but struggled to preserve its bullish momentum. Before the FOMC releases the minutes of its March meeting later in the session, the US Dollar Index holds steady near 99.50, supported by hawkish Fed commentary. 


GBP/USD clings to modest recovery gains near 1.3100.GBP/USD has gone into a consolidation phase after staging a rebound toward 1.3100 during the European session. Although the greenback is struggling to find demand following Tuesday’s rally, the risk-averse market mood is not allowing the pair to gain traction.


Gold holds above $1,920 despite surging US yields.Gold fluctuates in a relatively narrow range but manages to hold above $1,920. Although US Treasury bond yields continue to rise, the yellow metal seems to be finding demand amid the negative shift witnessed in risk sentiment.

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