A certain purchase activity reaches the tills – TDS

Gold prices continue to melt into new all-time highs overnight, notes TDS Senior Commodity Strategist Daniel Ghali.

Shanghai traders’ positioning exceeded record highs

“Clearly some buying activity is hitting the boxes, but the source remains off our radar for now. In fact, visible flows point to modest outflows from broad commodity funds and a continued trend of outflows from Chinese gold ETFs. Trader positioning in Shanghai exceeded record highs, with aggregate net positioning for top traders remaining fairly stable.”

“Certainly, participants are comfortable knowing that central banks are on the auction block, but on a six-month moving average, global central bank official flows are trending toward five-year lows. In Comex Gold, the non-commercial ‘short directional’ positioning, which is EFP’s positioning, pretty much indicates they have not gone short following recent short covering.”

“The latest indicator of macro fund positioning is just a nudge below its all-time highs, and CTAs are effectively max long. We see only marginal inflows into the popular Western Gold ETFs, and perhaps most notably, signs of risk parity and a resurgence in steering-target funds.”