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Gold Price Setup: Can Stretched Long Positioning in XAU/USD Trump Technicals?

June 8, 2023

Via: DailyFX

Gold is at a critical juncture – stretched retail traders’ long positioning poses downside risks to XAU/USD. However, if the past is any guide, the yellow metal may not be ripe for a bearish break just yet.

The IG Client Sentiment (IGCS) shows 72% of retail traders are net-long with the ratio of long to short at 2.6 to 1. The number of traders net-long is 6.4% higher from last week. The IGCS data at times functions as a contrarian indicator – the fact traders are net-long suggests the next move in gold could be down.

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