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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Gold retraces, oil dips

Lockdown restrictions and worsening US-China relations dent appetite for oil ahead of tomorrow’s OPEC+ technical meeting.

Mining Source: Bloomberg

Gold Technical analysis, overview, strategies, and levels

Gold prices oscillated again at the highs undoing gains made earlier in the session before dropping this morning. This is despite the plummet in equities, though given the 'buy equities and hedge by buying gold' mentality combined with a stronger dollar this morning, in some cases gold prices may move with some correlation alongside indices. All its main technical indicators continue to flash green, but the exposure of this leg of the trade to downside risk and expectations of increased volatility is keeping its overview volatile, and in turn pivot points in both directions are at risk of breaking. US CPI (Consumer Price Index) figures will be released later today expected to show an increase.

Gold Technical Indicators Source: IG charts

IG client* and CoT sentiment for Gold

Retail bias while still heavy long is up a notch to 71%, as traders both small and large anticipate further upside gains.

Gold sentiment Source: IG charts

Gold chart with retail and institutional sentiment

Gold Source: IG charts

Oil Technical analysis, overview, strategies, and levels

There have been at least a couple of negative factors yesterday including US-China relations worsening and lockdown restrictions being reimposed in the state of California, usually negatively affecting the energy commodity in need of increased transportation and travel demands. The net result was a partial undoing of gains made late last week, and has taken oil prices as of this morning below the $40 level. We've got API's (American Petroleum Institute) reading tonight, though with OPEC+'s technical meeting tomorrow risk appetite might be limited with repositioning a bigger factor.

Learn more about oil trading.

Oil Technical Indicators Source: IG charts

IG client* and CoT sentiment for Oil WTI

Retail traders are beginning to range-trade these consolidatory moves, yesterday's price drop causing the bias to shift from the middle to 57% long as of this morning.

Oil sentiment Source: IG charts

Oil WTI chart with retail and institutional sentiment

Oil Source: IG charts

*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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This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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