FX.co ★ Gold is in a bull market, but growth is starting to slow

Gold is still in a bull market, but according to the latest Commodity Futures Trading Commission (CFTC) report, growth has started to slow because apparently, the yellow metal has been overbought ever since it rallied above $ 1,900. The data said CFMs increased their speculative long positions in Comex by 3,408 contracts to 147,270, while short positions rose by 690 contracts to 37,297.

Ole Hansen, head of commodity strategy at Saxo Bank, said purchases last week were significantly lower than in April and May.

Commodity analysts at TD Securities also warn of a slowdown in the gold market.

Similarly, Commerzbank analyst Carsten Fritsch said they remain bullish on gold, despite short-term volatility. They also believe that inflation is just starting to rise, so by the fourth quarter, the Federal Reserve will begin to cut back its bond purchases, which is good news for gold. In short, investors should keep an eye on real interest rates, even if the Fed slows down its balance sheet expansion.

As for silver, the COT report said speculative long positions fell 2,509 contracts to 70,120, while short positions increased by 478 contracts to 29,441. This indicates that silver is entering a bear market, mainly due to weakening industrial demand.

Copper is also dipping, with speculative long positions sinking by 3,455 contracts to 67,542. Short positions, meanwhile, rose by 2,825 contracts to 40,774.