Gold: Data risks and CTA selling – TD Securities

TD Securities’ Ryan McKay and Bart Melek highlight that upcoming US Non-farm Payrolls (NFP) and a renewed hawkish Fed tone are critical for Gold, with prices near CTA (Commodity Trading Advisors) selling thresholds around $4,300/oz. Their simulations show further declines toward $4,200–$4,100/oz could push CTA positioning close to flat, though they see limited material downside longer term as the precious metals backdrop improves.

Gold nears key CTA sell triggers

"Economic data becomes increasingly important for precious metals, with gold at risk of CTA selling."

"Non-farm payrolls this Friday will be the next piece of data with keen interest for precious metals given the renewed hawkish tone from the Fed and the latest escalation in the energy market."

"Price reaction may be more prone to the downside on potential beats in the data with gold nearing some CTA selling levels near $4,300/oz and our pricing simulations suggesting a further downward trend toward $4200-$4100/oz would see positioning reduced back to near flat into next week."

"Hike pricing has increased to over two hikes in 2027 again, and we have argued the recent rally in the yellow metal was too early due to these lingering inflation concerns."

"However, looking forward, we do not anticipate material downside as the landscape for precious metals has improved amid a renewed dollar debasement theme, while Fed hikes remain far from certain."