Gold Surges 7% Weekly as Citadel Securities Issues Bullish Structured Product Outlook

Citadel Securities advises gold allocation citing Fed shift, central bank buying, and short-covering. Gold trades above $4,300 with 7% weekly gain, largest since January.

Woofun AI reports that Scott Rubner, strategist at Citadel Securities, advised investors to allocate positions in gold-based structured products for the first time since 2024. Rubner cited five drivers: rising expectations of a Federal Reserve policy shift, continuous central bank buying, quantitative fund short-covering, bullish options signals, and potential retail fund return from AI assets. Recent U.S. job market cooling weakened the dollar and boosted gold demand, with prices trading above $4,300 per ounce and rising over 7% last week.

As of August 6, commodity trading advisor funds held net short positions in gold and silver; trend-following funds may cover shorts if prices break out further. Implied volatility for SPDR Gold Shares (GLD) has risen, with put/call skew reverting to February levels. Central bank buying, including China's 21st consecutive monthly increase in July, supports long-term price increases amid U.S. fiscal pressures and geopolitical risks.