Oil advances as future supply concerns weigh, gold retreats
EIA’s inventory readings tonight expected to show deficit in US oil following API’s drawdown yesterday.
Gold technical analysis, overview, strategies, and levels
Retreating yields is usually a plus for gold prices and coincides with greenback weakness, and yet the dollar managed to finish slightly higher in the forex market yesterday, gold prices finishing slightly lower in the process in a session that aided conformist buy-on-reversal opportunities as its previous first support level managed to hold.
The three-year auction level didn't disappoint, the more important ten-year up next tonight before attention shifts to tomorrow's crucial US CPI figures, Chinese CPI this morning a slight miss but a surge in PPI real fears that absent price controls, inflationary pressures on consumers would be even higher, both in China and globally. Silver underperformed in yesterday's session as its bull trend stalls heavily as well, the gold/silver ratio edging into the 68s.
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IG client* and CoT** sentiment for Gold
In sentiment, retail bias remains extreme long in silver (87%) and platinum (92%), while here it's a heavy long 75%
Gold chart with retail and institutional sentiment
Oil WTI technical analysis, overview, strategies, and levels
Decent session for Oil - US Crude prices which finished higher, crossing above its previous first Resistance level and aiding conformist breakout strategies only slightly on a lack of follow-through beyond the key level, its technical boxes in both time frames continuing to flash green, and buoyed (thus far) by lowered expectations on the return of Iranian oil following comments from the US Secretary of State that "hundreds of sanctions will remain in place" on the oil-producing nation "even in the event of a return to compliance with the JCPOA".
In oil data, API's readings for US inventories showed a 2.1m drawdown in oil, gasoline and distillate up by 2m and 3.8m respectively.
EIA's more encompassing estimate is up next with expectations for a more sizable deficit, the agency yesterday forecasting US crude output to decline less than previously forecasted and trimming world oil demand growth for this year slightly.
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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 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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