Some analysts have said that a break of $1,850, which also represents gold’s 200-day moving average, could be the signal that hedge funds and money managers are waiting to increase their bullish speculative positioning into the gold market.
CFTC disaggregated Commitments of Traders report for the week ending May 4 showed money managers increased their speculative gross long positions in Comex gold futures by only 290 contracts to 117,434.
Gold’s net length currently stands at 53,625, down up nearly 6% from the previous week.
The world’s largest gold ETF, the SPDR Gold Trust, reported inflows of nearly six tons on Friday – its most pronounced daily inflow since mid-January,” the analysts said.
“Given that US nominal rates trended lower, even as breakevens further along the curve increased, points to additional upward price pressure which should see additional short covering and new longs in the coming weeks.
The disaggregated report showed money-managed speculative gross long positions in Comex silver futures rose by 1,933 contracts to 66,702.
During the survey period, silver prices were fairly volatile as prices tested critical resistance around $27 an ounce.
At the same time, growing industrial demand as the global economy starts to open up will also support prices, analysts added.