Every time futures positioning shows commercial traders covering shorts near flat or net long positioning, after having exceeded 200k contracts net short, a peak in the stocks/gold ratio occurs, and buy setups might present in the XAUUSD chart. Viceversa when positioning goes from this extreme to the other, breaking back below 200k contracts net short after being flat or almost flat.
Very useful signals can be obtained, to decide when to be in stocks, or gold, or when to play the long side in metals to hedge your stock holdings. At this point in time, a steady long term trend can occur, but is not yet warranted from the data I observe, macro speaking, from both a technical, and fundamental perspective. Sentiment got a bit too crazy in gold as well, so, the rally is not likely to keep grinding higher. The red and green vertical lines illustrate past signals like these.
If you're long, I'd reccomend to exit or trail stops, if you want to short stocks, I'd suggest to instead find good long positions in select equities instead or at least cover shorts before things go badly for you.
Cheers,
Ivan Labrie.
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Interestingly enough, #XAUUSD made a new high, first since 2016, and not only that but it surged faster and further than the last quarter's range, whilst RgMov was breaking all time highs since the 2011 peak...this is NOT a minor occurrence
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Gold likely peaked, the next retrace, during July-August will be an amazing buy after it bottoms.
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2-Month timeframe implications...buy the dip close to 1345 or lower, after June ends.