Gold: Traders holding a long position – TDS

Gold is sitting at $1565.75 while the context for the yellow metal is a market where traders are holding long, but not large positions, according to strategists at TD Securities.

Key quotes

“Gold is a crowded trade. The bull market narrative is widely acknowledged, which translates to an above-average number of traders holding a long position, although the average trader's position size is not excessive, suggesting that greed is not widespread.” 

“The risk to gold bugs is a change in narrative that would prompt a decline in the number of traders long. A reversal of recent safe-haven flows driven by fears that the Wuhan coronavirus could contaminate global reflation appears to be an obvious candidate for a narrative-driven reversal.