Amongst concerns TD ennumerate on gold are:
- discretionary trader positioning "remains bloated" (to the long side), which means positioning risks are now asymmetrically skewed to the downside
- froth above and beyond what is consistent with expectations of Fed cuts
- Asia on a buyer's strike
- notable long liquidations on Shanghai Futures Exchange
TD says a "a liquidity vacuum could ensue with fewer buyers to offset potential liquidations".
As for levels TD says gold is vulnerable to a break south of US$2380/oz.
---
As for that 'buyers strike' I noted in June the PBOC bought no gold in May. And that this continued for a second consecutive month.
The absence of an underlying bid like this is a concern for gold bugs.
