SG: GOLD – Large stops gone through above $1207/oz (on spot) on this short squeeze rally

From the FXWW Chatroom – CITI: Going for gold.
Gold prices have been quietly rallying this morning. Rather untypically, the USD is not leading this move. We think that what’s driving gold prices higher is the safe haven status returning, keeping Italy risks in mind. Our commodities colleagues highlight that gold is rallying against EUR, CHF, JPY and approaching levels that have been capped for some time. On top of that physical tightness in copper and zinc pushing base metals higher so whole metals complex looking good.

Gold vs EUR has broken through 1042, a level our commodities colleagues were watching, as well as the 55d MA. We would also point out that positioning in gold has been bearish for some time – shorts may be caught out here.

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