Discretionary and Asian buying offset stagnant CTA positioning, while softer US jobs data fuels stagflation fears supporting gold.
Gold prices remain above $2,300 per ounce as robust discretionary and Asian demand counterbalance plateaued Commodity Trading Advisor (CTA) positioning. Strategists note CTAs may only add length if prices approach $4,600 per ounce, a threshold not yet met.
Recent US jobs data fell short of expectations, easing Federal Reserve rate hike pressures. Subdued energy prices and speculation that Fed Chair Warsh will hold rates further bolster gold’s appeal amid a potential stagflation narrative. Asian buying, including broad-based demand on the Shanghai Futures Exchange (SHFE) and ETF inflows, continues to drive momentum.
While higher energy prices could pose risks, upcoming US inflation data will be critical. If markets solidify expectations of no near-term rate hikes, gold’s rally may persist despite CTA hesitancy.