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Diversification away from risk assets to help Gold

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NEW YORK (Scrap Register): Worries about how long the equity-market rally will last should help put a floor under gold, said TD Securities in a snippet.

“We estimate that CTAs [Commodity Trading Advisers] are still building a substantial position in gold, despite a relatively low bar for the algorithmic trend followers to abandon ship, which is keeping whipsaw risk elevated,” TDS added.

“However, a growing chorus of market observers is arguing for diversifying away from equity-market risk, following the last three months' monumental rally, which suggests additional interest in gold should keep the yellow metal's prices above the high-water mark,” TDS noted. 

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