CTAs are 'max long' Gold and Silver, but the margin of safety against algo liquidations in Gold still remains elevated, TDS commodity analyst Daniel Ghali notes.

No directional shorts remain in Gold markets

“This print is the first significant challenge to the consensus narrative that has attracted enough capital for our measures of positioning to scream extreme on several fronts, but liquidations have remained miniscule nonetheless, suggesting geopolitical fears are keeping accounts from liquidating.”

“Contrary to what is implied by price action, the last weeks haven't seen massive inflows into Gold according to our positioning analytics, but rather point to a liquidity vacuum with few sellers up in the stratosphere.”

“After all, money manager shorts are now overwhelmingly tied to EFPs, suggesting nearly no directional shorts remain in Gold markets. Conversely, Silver prices have a smaller margin of safety against the first selling program, but in the event that nascent signs of reflationary trends persist, Silver and base metals are a superior expression.”