Gold eased toward $4,000 an ounce in early Asian trading Oct. 27 after rebounding from a three-month low, as OCBC analysts said deleveraging and position adjustments continued to weigh on bullion.
Reuters reported spot gold at $4,007.29 an ounce, down 0.2%, at 11:21 p.m. ET Oct. 26 (03:21 UTC Oct. 27). In the previous session, gold had risen 0.6% to $4,020.60 by 2:09 p.m. ET (18:09 UTC), after touching $3,975 on Oct. 23, its lowest level since July 20. Reuters linked the earlier gain in part to lower oil prices easing inflation concerns.
FXStreet attributed the analysis to OCBC FX strategists Sim Moh Siong and Christopher Wong, citing the bank’s Oct. 26 Precious Metals Tracker: Searching for a Floor. The analysts said broader deleveraging and position adjustments were weighing on bullion. They viewed gold’s muted response to lower Treasury yields the week before as a sign of those pressures and cited increased demand for protection against further declines. FXStreet reported that they described the rebound as “tentative.”
The analysts also cited a historical tendency for gold to trade firmer in the months after U.S. midterm elections, while cautioning that the pattern does not ensure a sustained rally, FXStreet reported.
CFTC data showed managed-money traders held a net-long position of 104,206 COMEX gold futures contracts as of Oct. 20, down 2,883 from the prior week. That figure covers one futures-trader category, not all gold-market positioning.
The World Gold Council reported that global physically backed gold ETFs received $10 billion in September. Holdings rose 67 tonnes to a record 4,256 tonnes, but those September figures do not show fund flows during the subsequent October selloff.
The Federal Open Market Committee is scheduled to announce its decision at 2 p.m. ET Oct. 28 (18:00 UTC), followed by a news conference at 2:30 p.m. ET (18:30 UTC). The Bureau of Economic Analysis is scheduled to release September personal income and outlays data, including the personal consumption expenditures price measures watched by the Fed, at 8:30 a.m. ET Oct. 29 (12:30 UTC).
