Bearish Sentiment: Taking the sell side of XAU/USD indicates a bearish outlook on the price of gold relative to the US dollar. Traders and investors expect the price of gold to decrease or anticipate the US dollar to strengthen against gold.
Profit from Price Decline: Traders who sell XAU/USD aim to profit from a decrease in the price of gold. They would sell now with the intention to buy back (cover) at a lower price in the future, thereby pocketing the difference.
Risk Management: Like any trade, selling XAU/USD involves managing risks such as price volatility, geopolitical events affecting gold prices, and economic data impacting the strength of the US dollar.
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