Daily Market Report: Gold, Silver, Oil
Silver outperforms as gold’s price lags at the highs
GOLD: Stalling at the highs as Monday’s flows were relatively sedate
Expectations weren’t high to begin with yesterday, given the lack of data and investor attention on this week’s retail data and earnings release. Both will be important today in determining risk appetite and future Fed easing expectations, and as a result gold’s non-yielding attribute and greenback strength will be in play as financial earnings from the US set the tone in terms of risk. From a technical standpoint, it’s a bull trend that’s stalling at the highs, and where its bull trend line on the daily chart is still holding thus far. Retail bias is still heavy long at 67% after dropping a notch, while institutional bias is at extreme long levels.
SILVER: Positive technical bias as more technical indicators flash green
We’re accustomed to seeing silver’s price underperform compared to gold’s, so yesterday’s increase was a slight relief for extreme long retail traders holding a 94% long bias, dropping a notch on slight long profit-taking. However, the bulk of those longs have been initiated at far higher price levels, and far more gains will be needed before significant profit-taking can occur. From a technical standpoint, it’s still relatively consolidatory but its price is above all its main moving averages and piercing the upper extremes of the band. Most of its technical indicators are huddled close to each other, and hence crosses occur more frequently making it a more difficult pair to predict.
OIL – US CRUDE: Bull trend gets tested ahead of API’s release tonight
Although geopolitical tensions have yet to subside, energy prices retraced off the highs yesterday and is already testing the recent technical overview change to an initializing bull trend whereby most of its indicators are flashing green, but a non-trending ADX and a greenback that thus far hasn’t weakened further. API’s estimate is tonight, and while it isn’t as encompassing as that of EIA’s estimate tomorrow, last week’s figure was quite similar to EIA’s 9.5M deficit that sent energy prices higher. US data and earnings will determine the demand side, while deficits and geopolitical tensions will dictate the supply side. Meanwhile, retail bias has increased 3% as fresh averaged-in shorts close out while longs ponder over whether to hold on anticipating further gains.
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