Who is going to sell Gold? Strategists at TD Securities believe that the yellow metal has limited downside potential barring a more hawkish path ahead.

The pace of Chinese selling could slow

“Our tracking of positioning for the top traders in Shanghai gold has pointed to notable liquidations over the past weeks, but this cohort's Gold length is now at sub-average levels relative to the last year. This suggests the pace of Chinese selling could slow, leaving investors as the marginal buyer or seller.” 

“We don't expect any downside flow from CTAs until prices break the $1,840 range. And, we argue that notable selling activity from CTAs will likely be elusive above the $1,800 mark. In contrast, the margin of safety against a marginal buying program is razor thin above $1,900.” 

“Discretionary money manager positioning also appears flat.” 

“The slump in precious metals prices could be limited without data corroborating a more hawkish path ahead.”