Gold surges to fresh highs, silver outperforms

Gold Technical analysis, overview, strategies, and levels

Precious metals have continued to enjoy gains in prices, and yesterday's moves took it beyond its 1^st Resistance level for a conformist strategy. The weekly overview is a bull trend, and while the daily overview is bullish with all its main technical indicators flashing green, thus far the split has remained between conformist breakout strategies on increased volatility vs. contrarian reversal strategies when momentum is lacking. A worsening economic environment means monetary and fiscal policy will be in full swing, with more fiat printing giving precious metals a leg to stand on.

IG client^* and CoT sentiment for Gold

As for retail trader sentiment, majority long bias has been dropping as of late as longs get enticed into taking profit, but the latest figures show no change since yesterday morning, opting to remain at a majority long 59%.

Gold chart with retail and institutional sentiment

Silver Technical analysis, overview, strategies, and levels

Silver was the outperformer once again compared to gold, with the gold/silver ratio registering a fifth consecutive decline as silver prices outperform that of its precious metal cousin. In the overall precious metals market, palladium was in for yet another fresh record high, and so too did platinum enjoy gains for the session. Fed minutes showed ongoing optimism regarding the economy despite coronavirus risks, but money markets continue to majority price in a rate cut later this year and anticipate further easing globally to address recent fundamental risks. From a technical standpoint, while a sell-on-reversal on yesterday’s 1^st Resistance panned out the first time, the second move higher has offered little retracement thus far, and no doubt should the gains continue would entice contrarian breakout strategies over conformist reversals.

IG client^* and CoT sentiment for Silver

Silver chart with retail and institutional sentiment

Oil WTI Technical analysis, overview, strategies, and levels

Multiple factors have been at play for oil prices with concerns over dented demand as factories are slow to come back online in China and possible reductions in supply due to geopolitical instability (that may get addressed swiftly given output requirements). But the most recent item on the economic calendar front was API's (American Petroleum Institute) oil inventories report which registered a 4.2M surplus following last week's 6M surplus. And as always, EIA's (Energy Information Administration) estimate is up next, this time around expected to show a similar 3.3M increase. From a technical standpoint, the gains made yesterday were well beyond its 1^st Resistance level that aided conformist strategies.

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IG client^* and CoT sentiment for Oil WTI

In sentiment, retail bias continues to drop as longs stuck previously on the move lower get enticed into closing out, with the extreme long bias dropping 4% to 79%.

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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