0
0
(Kitco News) – Hedge Fund continues to add to their bearish bets in gold. However, analysts say that their weaknesses can be limited and the market is an attractive stepman.
The CFTC Disagregated Commitments of Traders Report for the week ended July 19 showed that the money manager lowered their speculative gross long position in Comex Gold Futures by 613 contracts to 91,056. At the same time, the short position rose 11,992 contracts to 109,794.
The short position of the gold net increased to 18,738 contracts. During the survey period, gold prices tested support of around $ 1,700 per ounce. Bearish position is at the highest level since May 2019.
Analysts have noted that the gold market has been in a solid down trend because the federal reserve aggressively raised interest rates to slow down the economy and increase increased inflationary pressure. The central bank wants to raise interest rates with 75 other base points Wednesday. The market sees interest rates that have the potential to rise between 3.50 and 3.75% at the end of the year.
However, many analysts also say that the increase in interest rates has been valued to the market, limiting the weaknesses of gold throughout the rest of this year. Some analysts also note that the slowing economy and the potential for recession can cause Fed to slow down the rate of interest rates.
“Any sign that the Federal Reserve created in an increase in interest rates would be good for gold,” said John Hathaway, senior portfolio manager of the special situation strategy Sprott Hathaway. “I see these numbers as a signal about sentiment and people who are sad, discouraged. From this low point in psychology that you get this demonstration.”
Commodity analysts at Société Générale said that the gold market had seen $ 21 billion in a bearish position since June 21. They also noted that the “very vulnerable” market for short cover.
Analysts note that the last time the Gold Clean position was this bearish, the market quickly turned around and rally for months that pushed prices to record the highest above $ 2,000 per ounce.
[Sentiment] does not guarantee anything, but with a benchmark of this kind of history, Gold is definitely not at the top. Even for agnostic traders, you want to pay attention to this, “Hathaway said.
But it’s not just gold. Analysts at Socgen also saw silver as “very vulnerable” against short cover.
The report was transmitted to show that the speculative gross long position managed by money at Comex Silver Futures fell 684 contracts to 36,411. At the same time, the short position rose 2,909 contracts to 50,452.
Silver position is not short of 14,041. The price of silver has supported $ 18 per ounce during the survey period.
The Perak Market continues to fight because industrial demand is still being muted. Analysts note that 60% of silver demand comes from industrial use.
However, some analysts note that sentiment in industrial metals, as seen in the copper market, can approach the bottom.
Reports that were transmitted to copper showed the speculative gross long position managed by money in Comex, high -level copper with 1,099 contracts to 38,869. At the same time, the short position fell 4,904 contracts to 53,405.
This is the second increase in succession in the bullish position because the clean short bet reached 14,536 contracts. During the survey period, the price of copper reflects support below $ 3.20 per pound.
“The peak (local) in the commodity outflow is behind us. Capital flows back to a broad commodity fund, for the first time in more than a month. This marks the end of the most steep outflow of this cohort since 2014, after a month from the massacre in The commodity sector sees the outflow exceeding what was observed during the panic of Covid-19, “said commodity analyst at TD Securities. “In the end, the base metal is still in the bear market regime, but the arrangement is still mature for a short closing rally to occur.”
Average Rating