Gold Futures: Downside appears capped

Investors trimmed their open interest positions in Gold futures markets by around 10.5K contracts on Wednesday, according to advanced figures from CME Group. Volume, instead, went up sharply by around 144.3K contracts, reversing three consecutive daily pullbacks.

Gold could extend the drop to $1,850/oz

Wednesday’s downtick in Gold prices was on the back of shrinking open interest, hinting at the idea that a deeper retracement seems unconvincing for the time being. Despite this view, the ounce troy of the precious metal does not rule out a potential test of the September low in the $1,850 region.