A period of high deficits, slowing growth, sticky inflation, currency devaluation and an imminent cutting cycle has already attracted capital towards Gold's warm embrace, TDS Senior Commodity Strategist Daniel Ghali notes.
Bullish narratives in Gold markets pose risks
“Our flow-based analysis now suggests that downside risks are more potent. After all, macro fund positioning is now at its highest levels since the depths of the pandemic. It is more statistically consistent with 370bps of Fed cuts over the next twelve months. CTAs are effectively 'max long'. Chinese Gold ETF outflows have resumed.”
“Shanghai trader positioning near record-highs already reflects Gold's allure in the face of a weaker domestic currency, stock and property market. Narratives in Gold markets are unanimously bullish and have attracted a nearly unanimous consensus for higher Gold prices, but we see significant risks to the near-term outlook tied to positioning.”
“Jackson Hole is the first potential catalyst, but the next payrolls release may be a more consequential potential catalyst.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
![EUR/USD holds near 1.1100 after mixed US data](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/EURUSD/dollar-and-euro-bills-58059534_XtraSmall.jpg)
EUR/USD holds near 1.1100 after mixed US data
EUR/USD struggles to hold above 1.1100 in the American session on Thursday. The US Dollar holds its ground following the mixed macroeconomic data releases as investors refrain from taking large positions ahead of Friday's jobs report.
![GBP/USD stays above 1.3150 as markets assess US data](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/GBPUSD/new-style-twenty-pound-notes-3079195_XtraSmall.jpg)
GBP/USD stays above 1.3150 as markets assess US data
GBP/USD continues to trade in positive territory above 1.3150 on Thursday. After weakening against its rivals on weak ADP employment data, the US Dollar finds a foothold on upbeat Jobless Claims and ISM Services PMI data, limiting the pair's upside.
![Gold extends recovery toward $2,520 area](https://editorial.fxstreet.com/images/Markets/Commodities/Metals/Gold/stack-of-golden-bars-in-the-bank-vault-60756080_XtraSmall.jpg)
Gold extends recovery toward $2,520 area
Gold extends its rebound and trades near $2,520 in the second half of the day on Thursday. The benchmark 10-year US Treasury bond yield stays in the red below 3.8% after mixed data releases from the US, supporting XAU/USD.
![Crypto Today: Bitcoin, Ethereum attempt recovery from recent dip, XRP loses key support and slips to $0.54](https://editorial.fxstreet.com/images/Markets/Currencies/Digital%20Currencies/Bitcoin/Bitcoin_Book_XtraSmall.jpg)
Crypto Today: Bitcoin, Ethereum attempt recovery from recent dip, XRP loses key support and slips to $0.54
Bitcoin and Ethereum attempt recovery from the decline earlier this week, BTC is back above $57,000 and Ether hovers around $2,400. XRP loses key support and slips to $0.54 on Thursday. Former CEO of defunct exchange Mt.Gox prepares to launch EllipX in Europe.
![ADP Employment Change Preview: US private sector expected to add 145K new jobs in August](https://editorial.fxstreet.com/images/Macroeconomics/EconomicIndicator/Employment/employment-51256484_XtraSmall.jpg)
ADP Employment Change Preview: US private sector expected to add 145K new jobs in August
ADP Employment Change is forecast to arrive at 145,000 in August. Labor market conditions could influence the Fed’s policy outlook. The US Dollar stays resilient against its rivals after posting large losses in August.
![Moneta Markets review 2024: All you need to know](https://editorial.fxstreet.com/images/IT/Testing/Review/FXSBadgeCertifiedBackg_XtraSmall.png)
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.