Quantcast

Hedge Funds Getting Bullish on Gold

Could take the yellow metal to previous all-time highs… or beyond...

The gold market has seen many momentum shifts in recent months.

At the end of the day, however, the market really depends on one simple factor: Are the big money inflows trending in a bullish or bearish direction?

Near market lows, speculative interest tends to be heavily on the short (bearish) side.

That sets the stage for buying pressure to be released when rallies force short sellers to cover their positions.

...article continued below
- Advertisement -

As traders shift to taking on more long (bullish) positions, momentum builds for higher prices.

Recent data suggests that hedge funds and large market participants are again ramping up their bullish gold positioning and that could take the yellow metal to previous all-time highs… or beyond.

Hedge funds have increased their bullish bets on gold and do not appear to be afraid of recent talk of Federal Reserve tightening sooner than expected.

Latest data from the Commodity Futures Trading Commission (CFTC) shows that hedge funds increased their speculative net long positions in gold by over 10,000 contracts.

...article continued below
- Advertisement -

Billionaire hedge fund manager Ray Dalio has taken out a sizeable stake in gold, declaring “cash is trash.”

Dalio has also been dabbling in cryptocurrencies.

But rival billionaire hedge fund manager Paul Singer calls them “ridiculous,” preferring instead to own tangible alternatives to cash, including gold.

Guggenheim’s CIO Scott Minerdi is eyeing an ultimate price target between $5,000 and $10,000 per ounce.

“As money leaves crypto and people are still looking for inflation hedges, gold and silver are going to be much better places to go,” he said recently.

Of course, there are numerous reasons why hedge funds and other big players may want to get their hands on gold bullion. Rising inflation worries, easy monetary policies, and a weaker dollar to name a few.

With the stock market possibly at or near its high, the buying in gold has not been limited to U.S. market participants.

Players in other nations have many of the same concerns, and those concerns may keep gold well supported as it approaches its previous all-time highs.

According to IPE.com, a major Swiss pension fund has also traded in its hedge fund and raw materials holdings for gold.

This trend looks likely to continue, especially if precious metals markets continue to float higher.

Against the current backdrop of rising price pressures and a Fed that is willing to let inflation run hot for a long time, institutional interest in gold is likely to increase further.

Gold started the year around $1,918 per ounce, and a move back above that price could trigger additional buying and momentum upward, according to Blue Line Futures Chief Market Strategist Philip Streible.

The gold market tends to swing based on institutional trading momentum. As the yellow metal demonstrates strength, the amount of longs and size of long positions tends to rise.

Gold Bull

The opposite is true for when the metal shows weakness.

The current environment in gold suggests much further upside potential ahead.

Concerns over inflation, central bank policies, and currency weakness may all play a key role in gold’s rise. Additionally, a stock market reversal or period of risk-off trade could itself fuel further buying.

With little to no chart resistance above the market at current levels, the ascent in gold could be steep and could happen quickly. Once the train leaves the station, gold prices may not return to current levels ever again…Original Source

Stefan GleasonStefan Gleason is President of Money Metals Exchange, the company recently named “Best Overall Online Precious Metals Dealer” by Investopedia. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC and in hundreds of publications such as the Wall Street Journal, TheStreet, and Seeking Alpha.

- Advertisement -

TRENDING NOW

House Dems SHOCKED That Trump Asked DOJ to Declare Stolen Election ‘Corrupt’

(Headline USA) Democrats engaged in a partisan display of political theater on the House Oversight Committee feigned shock and indignation that then-President Donald Trump...

Is Corporate US Media Finally Rejecting ‘Russian Collusion’ Narrative?

(Aaron Mate', RealClearInvestigations) For more than four years, Western media outlets have exhaustively claimed that President Vladimir Putin of Russia waged a sweeping influence...

Ashli Babbitt’s Mom Was Told Sen. Feinstein Had No Time for Her

The mother of Ashli Babbitt revealed this week that when she called the office of Sen. Dianne Feinstein, D-Calif., office after her daughter was...

Cuomo Begs Employers to Force Return of Workers He Drove Away w/ Lockdowns

Democrat New York Gov. Andrew Cuomo begged employers to bring their employees back to the office by Labor Day, claiming remote work could put...

Grassley Fumes at NIH’s Weak ‘Explanation’ for Wuhan ‘Gain-of-Function’ Research

Sen. Chuck Grassley, R-Iowa, slammed the National Institutes of Health for failing to explain why federal grant money was given to China’s Wuhan Institute...

Freedom Caucus: Cheney, Kinzinger ‘Chose to Leave’ GOP; Pelosi’s ‘Reign’ Must End

Republicans in the House Freedom Caucus are pushing GOP leadership to expel Reps. Adam Kinzinger, R-Ill., and Liz Cheney, R-Wyo., from the conference, arguing...

Justice Dept. Says IRS Must Give Trump Tax Returns to Congress

(Headline USA) The Justice Department, in a reversal from the previous administration, says the Treasury Department must provide the House Ways and Means Committee former...

Taxpayer-Funded NPR Greenlights Its ‘Reporters’ to Be Activists & Protesters

A government-funded media institution borne out of the goal to promote objectivity and prevent media bias has now become one of Marxist cancel-culture's leading...

House Oversight Dems Hold Political-Stunt Hearing w/ Super-Spreading Texas Scofflaws

Impeachment-peddling hack Rep. Jamie Raskin, D-Md., undertook a new crusade to spread disinformation about election-integrity reforms as part of a hearing Thursday for the...
- Advertisement -