Gold and silver plummet, oil at 18-year lows

Gold Technical analysis, overview, strategies, and levels

It was another volatile session for gold prices, with a break below yesterday's 1^st and 2^nd Support levels in line with conformist breakout strategies once more, but where reversal strategies (buying after a significant break in the level) also managed to briefly offer trading opportunities. Safe haven hasn't been acting opposite riskier assets given somewhat of a breakage in the risk-off vs. risk-on links, but instead has been more focused on USD liquidity as investors liquidate to either cover positions on equities, or to simply hold cash to repurchase assets at a better price once the uncertainties subside. Gold prices from a fundamental standpoint ought to be higher given more central bank easing, but in the short-term wild swings in both directions can be anticipated given the difficulty in pricing the unknowns.

IG client^* and CoT sentiment for Gold

In sentiment, both retail and CoT bias are in extreme long territory.

Gold chart with retail and institutional sentiment

Silver Technical analysis, overview, strategies, and levels

It was another move into the 11s yesterday for silver prices, and below both 1^st and 2^nd Support levels where here too, conformist breakout strategies in line with its volatile technical overview were clear outperformers initially, Gold prices also suffered big losses plummeting below $1500, but once again outperformed compared to silver and in turn taking the gold/silver ratio to fresh record highs in the 126s.

IG client^* and CoT sentiment for Silver

Traders here are also holding extreme long bias against the recent bearish moves, with retail bias at 92% dropping only slightly from yesterday’s 94%.

Silver chart with retail and institutional sentiment

Oil WTI Technical analysis, overview, strategies, and levels

With little focus on oil inventories data, US crude oil prices plunged to fresh 18-year lows, breaking into the $20s and sending anything energy related into the red as countries brace for a plummet in demand combined with big increases in supply from oil-exporting countries including giants' Saudi Arabia and Russia. Once again (and as has been the case with other products in this report), conformist breakout strategies in line with its volatile technical overview have been the clear outperformers, and where fading strategies have been getting crushed. That being said, EIA's (Energy Information Administration) oil inventories estimate showed a 2M surplus compared to API's slight deficit the night before, though expectations are for those figures to increase sizably as countries stock up on the energy commodity given its price is at multi-year lows.

Learn more about oil trading.

IG client^* and CoT sentiment for Oil WTI

Oil WTI chart with retail and institutional sentiment

*The percentage of IG client accounts with positions in this market that are currently long or short. Calculated to the nearest 1%, as of today morning 8am.

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