Amongst concerns TD ennumerate on gold are:
discretionary trader positioning “remains bloated” (to the long side), which means positioning risks are now asymmetrically skewed to the downsidefroth above and beyond what is consistent with expectations of Fed cutsAsia on a buyer’s strikenotable long liquidations on Shanghai Futures Exchange
TD says a “a liquidity vacuum could ensue with fewer buyers to offset potential liquidations”.
As for levels TD says gold is vulnerable to a break south of US$2380/oz.
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As for that ‘buyers strike’ I noted in June the PBOC bought no gold in May. And that this continued for a second consecutive month.
People’s Bank of China bought zero gold for a second month in a row in June
The absence of an underlying bid like this is a concern for gold bugs.
This article was written by Eamonn Sheridan at www.forexlive.com.
