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22 Nov 2013
Flash: Specs could precipitate Gold overshoot, sub-$1,000/oz on intraday basis - TDS
FXstreet.com (Barcelona) - As the US continues to show tentative signs of recovery in the face of a US government shutdown, it suggests tapering is growing closer, which should result in even lower gold prices, notes Mike Dragosits, Analyst at TD Securities.
Key Quotes
"Gold specs will likely once again drive this market, with long futures positions likely to add downside pressure on lower gold prices, and short related positioning seemingly with a lot of capacity to react more assuredly to prices moving lower."
"Under our fundamental view, that the US economy continues to slowly improve, the Fed starts tapering QE between January and March of 2014, and real yields continue to move higher. This in turn should see speculative and possibly slower physical investment demand continue to be an overall bearish influence on gold prices."
"As such, we see gold prices continuing to move lower into Q2-2014, reaching an average of $1,150/oz over these three months. Spec positioning could also precipitate an overshoot, with gold hitting sub-$1,000/oz on an intraday basis. We will continue to watch Comex specs activity as a major contributing driver for this move."
Key Quotes
"Gold specs will likely once again drive this market, with long futures positions likely to add downside pressure on lower gold prices, and short related positioning seemingly with a lot of capacity to react more assuredly to prices moving lower."
"Under our fundamental view, that the US economy continues to slowly improve, the Fed starts tapering QE between January and March of 2014, and real yields continue to move higher. This in turn should see speculative and possibly slower physical investment demand continue to be an overall bearish influence on gold prices."
"As such, we see gold prices continuing to move lower into Q2-2014, reaching an average of $1,150/oz over these three months. Spec positioning could also precipitate an overshoot, with gold hitting sub-$1,000/oz on an intraday basis. We will continue to watch Comex specs activity as a major contributing driver for this move."