Gold and silver prices continued aiming lower in recent days, accelerating a decline since finding a top in late April. By looking at IG Client Sentiment (IGCS), we can see how retail traders have been evolving their exposure in these precious metals. IGCS tends to function as a contrarian indicator, especially in trending markets. With that in mind, could further pain be in store for XAU/USD and XAG/USD?
Gold Sentiment Outlook - Bearish
The IGCS gauge shows that about 66% of retail traders are net-long gold. Since most of them are biased higher, this hints that prices may continue falling. This is as upside exposure increased by 1.79% and 12.32% compared to yesterday and last week, respectively. With that in mind, the combination of current sentiment and recent changes offers a stronger bearish contrarian trading bias.
Gold Sentiment Outlook - Bearish
The IGCS gauge shows that about 66% of retail traders are net-long gold. Since most of them are biased higher, this hints that prices may continue falling. This is as upside exposure increased by 1.79% and 12.32% compared to yesterday and last week, respectively. With that in mind, the combination of current sentiment and recent changes offers a stronger bearish contrarian trading bias.