Gold shines on safe haven move, oil retraces

Gold Technical analysis, overview, strategies, and levels

Safe haven was in demand yesterday, and the price gains were clearer for Gold which finished higher and crossed above its Weekly 2nd Resistance level on the first day of the week, the key level managing to hold for now. Absent any significant volatile movement and the precious metal's overview is a stalling bull trend, its ADX in the short-term not showing a propensity to trend just yet thanks to what has been mostly oscillatory moves, yesterday's move a decent exception that gave breakouts on short-term levels the outperforming strategy. The drop in real yields remains a general catalyst for the non-yielding metal, the Fed's Evans saying monetary policy would remain accommodative “for a long time''.

IG client^* and CoT^** sentiment for Gold

Retail traders in both gold and silver are holding a heavy to extreme buy bias, here dropping to 76% and to 89% in silver. CoT speculators remain extreme buy for gold but have dropped to 82% on a reduction in longs (8K) and an increase in shorts (1.2K).

Gold chart with retail and institutional sentiment

Oil Technical analysis, overview, strategies, and levels

A lack of an agreement amongst OPEC+ members regarding increasing next month's output by 500K barrels per day combined with a reversal in risk appetite and increased lockdown action and talk meant there was a certain amount of volatility in store for the energy commodity, its price remaining within its Weekly levels for the time being. Talks are expected to resume today with key oil-producing titans within the group at odds over whether they should increase production or remain on hold. We'll also get the first of three usual weekly oil data with API's oil inventories reading. New lockdowns in the UK, Germany expected to extend its lockdown today, and Japan’s emergency lockdown potentially on Thursday are other items to note.

Learn more about oil trading.

IG client^* and CoT^** sentiment for Oil WTI

Meanwhile, the pullback has given retail shorts a chance to unwind, the bias shifting from short 55% to a now slight buy 54%, while CoT speculators have reduced their extreme buy bias to 81%.

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 for the outer circle. Inner circle is from the previous trading day.
** CoT sentiment taken from the CFTC’s Commitment of Traders report, outer circle is latest report released on Friday with the positions as of last Tuesday, inner circle from the report prior.

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