Weekly Market Report: Gold, Silver, US Oil
Gold plummets on drop in safe haven demand and rising US dollar, energy rises on improved trade outlook and OPEC output cut.
GOLD: Gold plummets on combined safe haven outflows and USD strengthening
Investor sentiment has risen on an improved trade outlook (even if nothing has been agreed upon yet), and as a result safe haven flows this morning have been tested significantly, dented also by a stronger greenback that has a tendency to work opposite and fall on reduced trade risks. That shouldn’t take away however, from what is a clear bullish technical overview on not just the weekly, but the daily as well, with all its technical indicators flashing green. Retail bias has increased over the past week to a majority long 63% as longs get enticed into buying the precious metal, while institutional bias has risen once more, now standing at an extreme long 83% on an increase in gold longs by 23.5K lots and a simultaneous reduction in gold shorts by 8.8K lots.
SILVER: USD strength this morning leaves this pair’s price in the red
While gold managed to finish the week in the green (despite the retracement), it was a red week for silver as it fails to keep up with its precious metal cousin. Last week’s slight retracement aside, the daily technical outlook is turning more positive, though on the weekly the bulk of its technical indicators remain neutral and with a non-trending ADX. Retail bias is unchanged since last week at an extreme long 95% where the bulk of those longs were initiated at higher price levels, while institutional longs are starting to return, with the bias rising 5% on a reduction in silver short positioning by 11.8K lots and a simultaneous increase in logs by 4.3K lots.
OIL – US CRUDE: Stronger on improved trade sentiment and an expected OPEC output cut
The trade truce has certainly aided the demand side factor for oil, and with supply side cuts out of OPEC essentially a guarantee after the weekend Saudi-Russian agreement and geopolitical tensions failing to subside, it’s no surprise that oil prices have risen this morning. Out of the US, Baker Hughes is up 4 from 789 to 793, as rising US supplies remains the wild card for downside pressure. The weekly technical overview remains more consolidatory with its price on the verge of crossing the 50-week and 100-week MA’s (with the former crossing below the latter last week). But the daily’s technical outlook is showing more positive bias, and its ADX trending. Retail bias has dropped 6% on long profit-taking over the past week, while institutional bias has inched higher as a reduction in short positions significantly outdoing the reduction in longs.
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