The Chinese FNB Gold recorded their largest outings in 264 commercial sessions, notes the main strategist of TDS raw materials, Daniel Ghali.
Macro catalysts could rally the gold rally despite a break
“These outings were (1) not particularly important, at -80koz and (2) probably linked to the profits before the holidays, but highlight the vulnerabilities associated with the liquidity vacuum induced by the China holidays. Unfortunately for the Bears, these vulnerabilities cannot be exploited without the western gold and gold speculators.
“The macro-foundations are largely clear in a recession / stagflationary story. The CTAs will not sell in any scenario for prices. Gold can be surprised, but it is heard.”
“The purchase impulse that has led the merger may have disappeared, but several catalysts on the horizon could rekindle it. Look for signs of asian money damping or the growing recession / stagflation to push the gas pedal.”
