Gold Rallies on Democratic Sweep, but Can It Last? On November 4th, the US midterm elections gave Democrats a majority in both the House and the Senate. That same day, #gold# futures rallied $135, or 3.35%. It was the largest single-day advance since gold fell to 13-month lows and broke below $4,000 for the first time since it closed above that level in late September 2025. With the Fed still expected to raise rates next month, can this political shift pull gold out of a multi-month correction and convince traders to pivot from bearish to bullish sentiment? That is the question we will try to answer today. Commentary by @garyswagner and Joseph Wagner

Gold positioning is at its most bearish in years. Trend-following funds have continued to sell, yet gold has failed to make a new low. The market is nearing a more complete capitulation, and the pool of potential sellers may be narrowing. 1/ Total open interest in CME gold futures is only around 400,000 contracts. At the same time, gold’s weight in broad commodity indices is rising, while leverage in risk-parity and volatility-targeting portfolios has reached what appears to be a reasonable ceiling. These two large, relatively sticky sources of open interest should be contributing more to positioning. That makes the persistently low total open interest striking. Estimated leverage in long/short quant fund portfolios is approaching 5x, yet gold open interest remains near 400,000 contracts. This divergence supports the view that gold is underallocated. 2/ More specifically, CTAs are estimated to hold their largest net short in gold since October 2021. One way to estimate discretionary traders’ futures positioning is to subtract the portion of CFTC money-manager positions attributable to CTAs. On that basis, discretionary traders have unwound 55% of the long positions they accumulated in June. Spot-flow tracking also suggests that they have largely stayed on the sidelines in recent months. 3/ The key to gold’s overlooked setup is the mismatch between the scale of selling and the price response. Over the past month alone, cumulative CTA selling amounted to 52% of their historical maximum position size. That monthly flow ranks in the third percentile historically—an extreme level of selling. Yet gold has not made a new low. One inference is that offsetting buying flows are growing stronger. A “mystery buyer” appears to be emerging in gold, though we do not know who it is. 4/ For now, every technical signal in gold points lower. Once trend-following signals have all turned bearish, however, further substantial selling would likely require a different scenario: discretionary traders and macro funds building large outright shorts while reserve managers continue to buy. That appears less likely. 5/ The next upside trigger for gold CTAs is $4,321, associated with potential buying of 12%; the next downside trigger is $4,177, associated with potential selling of 11%. The downside trigger is marked as the closer of the two to the current market. A sharper decline could still expand the net short further, while an advance would prompt some short covering.

Gold prices have rarely been as volatile as they are now. Gold futures have recorded 7 daily declines of -3.5% or more so far this year, the highest count since 2008. This is already more than double the 3 trading sessions recorded in 2025. By comparison, the largest annual number of sessions with declines of -3.5% or more was recorded in 1980, at 33. With 3 months of trading remaining, 2026 is on track to be the most volatile year for gold futures prices since 1982. As a result, gold futures prices are down -5.4% year-to-date, on track for their first annual drop since 2022, following their best year since 1979. The bond market has catalyzing some of gold's most volatile conditions in history.

GOLD SLIDES AS OIL FUELS RATE-HIKE BETS Gold futures fell for a third straight session as rising oil prices increased inflation concerns. Higher oil prices raise energy costs and inflation, increasing the likelihood that the Fed keeps rates higher or raises them further. That pushes bond yields higher and makes non-yielding gold less attractive. Markets now await U.S. economic data and Friday’s jobs report. Gold fell 1.4% to $4,418.50 an ounce.

Gold is increasingly being recognized as a strategic allocation. As investors build that allocation, different forms of gold each play a distinct role within a diversified portfolio. • Physical gold for direct ownership and wealth preservation • Gold ETFs for liquid market exposure • Gold futures and derivatives for trading and hedging strategies • Tokenized gold for digital ownership, transferability and on-chain utility Different vehicles, one strategic asset. $XAUm.

Why gold miners rose on gold's down day (Kitco Commentary by Przemyslaw Radomski) - At the moment of writing these words, the GDXJ, the ETF for junior mining stocks, trades near $111.70, after touching $112.81 earlier today, and December gold futures trade near $4,125. The miners are rising sharply for the second session in a row, and on Friday, they rose 2.8 percent even though #gold# fell $38.60 after a strong jobs report.