Hedge Funds Sell Gold: Gold Investors Should Know This!

hedge funds cut their bull bets on gold and increased short exposures for the third week in a row as investors prepare to raise interest rates by 50 basis points each for the first time in more than two decades by the Federal Reserve.

Short traders’ position starts to rise from bottoms

The latest trade data from the Commodity Futures Trading Commission (CFTC) shows an increasing bear trend in the precious metals market. However, some analysts state that the gold market remains healthy despite rising interest rates. Other analysts say the gold market is seeing some expected consolidation after a strong first-quarter performance that saw prices soar to $2,000.

However, some analysts think there is room for lower prices in the near term. In a report released Friday, commodity analysts note that there are still many satisfied bull investors in the gold market.

net non-trading futures position week-on-week as it cleared some oblivious positions on the war in Ukraine ahead of the Fed’s much-anticipated hike and quantitative tightening (QT) announcement. fell 3.5%. Analysts assess:

With the Fed telegraphing every move, positioning analytics will be key to price action. We see that there are still a significant amount of indifferent positions under it. The position of short traders started to rise from near-record lows.

Daniel Briesemann: Gold price dropped $100 so

CFTC’s Commitments of Traders report for the week ended May 3, money managers’ Comex gold futures showed that it reduced the speculative gross long positions in its transactions to 128,828 with 9,387 contracts. At the same time, short positions increased by 3,883 contracts to 60,981.

Gold’s net position now stands at 67,847 contracts, down 16% from the previous week to a three-month low. During the survey period, precious metal prices dropped below $1,900 but found support around $1,850.

Thus, 153 tons of gold were sold in the futures markets in the last three weeks. This is probably one reason why the gold price has dropped by $100 or 5% over this period, Commerzbank precious metals analyst Daniel Briesemann says.

“Despite headwinds, gold continues to show relative strength”

Saxo Bank head of commodity strategy Ole Hansen, whose views we have included in the news of Cryptokoin.com notes that short bets in the gold market are currently at a seven-month high. However, he also notes that despite the headwinds, gold continues to show relative strength compared to other assets. The analyst shared the following on his Twitter account:

USD-based investors are up +16% against SPX and +26% against TLT. In Europe, a euro-based investor is looking at +25% against Stoxx50 and +20% against EU Government bonds. Gold investors focus on the timing of the inevitable FOMC policy error.