Deutsche's Ghali Calls Gold Oversold, Urges Buying

Deutsche Bank's head of metals research, Daniel Ghali, told BNN Bloomberg on October 2, 2026 that gold is oversold and underowned and attractive heading into next year, even with US 10-year Treasury yields above 5% and oil above $100 a barrel. The metal has not set a new low since July. Ghali said central banks and other official buyers are running at more than double their 2021 to 2022 pace, while institutional participation in gold has grown by around 70% since 2021.

Context — why the gold call matters now

Ghali's argument rests on a gap between price action and macro pressure. Gold has held its ground through a stretch of rising yields and expensive crude, and he reads that resilience as evidence that official-sector demand is quietly absorbing the selling that would normally drive a break lower.

The comparable the report gives is 2022. Ghali said positioning today resembles that year, but the backdrop is very different. Central bank and official buying is more than double the 2021 to 2022 pace, and institutional participation in gold is up around 70% since 2021. That is the core of his case: the same crowded, washed-out positioning as 2022, against a materially larger official bid.

The catalyst for the shakeout was the Iran war, which the report says temporarily pushed discretionary investors to the sidelines. That exodus, rather than any change in the official demand story, is what left the market oversold.

Timing adds a near-term complication. Ghali cautioned that thin liquidity during China's Golden Week holiday could force a final capitulation before a base forms, which is why he framed the buy case for next year rather than for the coming sessions.

The macro backdrop remains the headwind he is arguing against. US 10-year yields are above 5% and oil is above $100, both of which have historically competed with gold for capital.

Data — what the positioning numbers show

A Deutsche Bank note from Ghali dated September 30 described gold positioning as nearing capitulation, and the figures are stark. Trend-following funds hold their largest net short position since October 2021. Discretionary traders have cut long positions by around 55% from a June peak. Open interest in CME gold futures has fallen to an extreme low.

Metric	Current	Prior reference
CTA net position	Largest net short since Oct 2021	Oct 2021
Discretionary longs	Down ~55%	June peak
Official buying pace	More than 2x	2021-22 pace
Institutional participation	Up ~70%	Since 2021

Gold's failure to make new lows despite that positioning is the signal Ghali leans on. His reading is that central banks and institutions are absorbing the selling that trend-followers and discretionary funds are generating.

The cross-asset comparison he draws is less supportive elsewhere in the complex. Silver has swung from extreme scarcity to oversupply, with London inventories at their highest since November 2024 and Chinese solar demand down by about a third this year. Copper faces its most acute scarcity since the 1980s, with the US and China holding roughly 70% of above-ground stocks.

Analysis — what it means for metals and miners

If Ghali is right that official buying is the marginal bid, the exposure sits with producers and royalty names rather than with the futures curve alone. Gold miners carry operating use to the metal price, so a base forming above the July low would matter more to their earnings than to a flat-price scenario. The report does not name specific tickers, and no miner-level figures are given.

The relative-value read is the more actionable part of his framework. Ghali expects silver to underperform amid oversupply, and sees copper offering the biggest gains in the near and medium term. That sets up a pair of trades rather than a single metals bet: long copper exposure against short or underweight silver, with gold as the official-demand leg.

The counter-argument is straightforward and Ghali does not dismiss it. Yields above 5% raise the opportunity cost of holding a non-yielding asset, and oil above $100 feeds the inflation that keeps central banks restrictive. If the Federal Reserve's tightening path extends, the rate drag could outlast the official bid, and the positioning that looks washed out could stay washed out for longer than the 2022 template implies.

Positioning is the crux. Trend-followers are net short at the largest size since October 2021, discretionary longs are down about 55% from June, and open interest is at an extreme low. Ghali's point is that this is the setup from which squeezes start, once the marginal seller is exhausted.

Outlook — what to watch next

The first thing to watch is whether gold sets a new low. It has not done so since July, and that streak holding through thin Golden Week liquidity would confirm Ghali's read that official buyers are absorbing supply. A break below the July low would undercut the thesis.

The second is the 10-year yield. Ghali's case assumes official-sector demand now outweighs the rate drag, and yields above 5% are the level where that assumption gets tested. Any sustained move higher pressures the argument.

The third is oil. Crude above $100 cuts both ways: it supports gold as an inflation and geopolitical hedge, but it also feeds the higher yields that weigh on the metal. Watch which channel dominates.

On the rest of the complex, London silver inventories at their highest since November 2024 and Chinese solar demand down about a third are the numbers behind the underperformance call. Copper's scarcity, with the US and China holding roughly 70% of above-ground stocks, is the offsetting long.

Frequently Asked Questions

What does Ghali's gold call mean for retail investors?

Ghali's argument is a positioning call, not a price target. He says gold is oversold and underowned because trend-followers are net short at the largest size since October 2021 and discretionary longs are down about 55% from June. For retail investors, the takeaway is that the bearish flow is concentrated in fast money, while official buyers are running at more than double their 2021-22 pace.

Why is silver expected to underperform gold?

Ghali points to a swing from extreme scarcity to oversupply in silver. London inventories are at their highest since November 2024, and Chinese solar demand is down by about a third this year. That combination leaves room for further declines, in his view, and makes silver the weaker leg against gold in a relative-value trade.

What makes copper the preferred metals exposure?

Ghali sees copper facing its most acute scarcity since the 1980s, with the US and China holding roughly 70% of above-ground stocks. He expects it to offer the largest potential gains in the near and medium term. That contrasts with silver's oversupply and with gold's reliance on official-sector demand to offset rate pressure.

Bottom Line

Ghali's bet is that official buying now outweighs 5% yields, leaving gold oversold into next year.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.