Gold sentiment has been adversely affected this month, with prices experiencing a decline of approximately -3.2%. The concurrent influence of increasing Treasury yields and a stronger US Dollar has placed significant pressure on the value of this precious metal. Should these losses persist, it could mark the most challenging month for XAU/USD since February. Notably, retail traders have not shied away from increasing their exposure to the upside, a trend reflected in the data from IG Client Sentiment (IGCS). This sentiment indicator often operates as a contrarian signal, implying the possibility of further hardships for gold.
Outlook for Gold Sentiment - Bearish The IGCS analysis reveals that roughly 80% of retail traders are currently net-long on gold. Given their predominantly bullish stance, this suggests a potential continuation of price declines in the future. Moreover, there has been an uptick in upside exposure by 2.72% compared to yesterday and 6.46% compared to last week. Taking these factors into account, the combination of overall positioning and recent shifts implies a stronger bearish contrarian trading perspective.
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