Gold risk reversals - bearish bias intact

• XAU/USD (Gold) One-month 25 delta risk reversals keep bearish bias.
• Signs of bearish exhaustion in the yellow metal around $1260 levels.

The one-month 25-delta risk reversals turned negative Oct.24 and hit a low of -0.175 on Oct. 31. Meanwhile, XAU/USD fell to a low of $1263 on Oct. 27 before turning higher to $1280 levels.

Despite the recovery in prices, the risk reversals remain flat lined at -0.175 (bearish bias intact). A negative reading indicates increased demand for downside bets (put options).

A convincing break above $1300 is needed to revive interest in bullish bias.

Risk reversals