Oil gaps lower as oil majors postpone meeting

Gold Technical analysis, overview, strategies, and levels

Last week's Weekly support pivot point was broken with ease and offered a sell-on-breakout with volatility higher early on in the week. Towards the end of the week its price recovered and tested the Daily buy-on-breakout strategy given the relative lack of follow through in what was a seemingly rangebound Friday session. With central bank decisions out of the way, any further drop in bond yields could entice investors either into equities anticipating easing to fuel price growth there, or wealth preservation non-yielding metals.

IG client^* and CoT sentiment for Gold

Both retail and larger speculative traders according to the latest CoT (Commitment of Traders) report continue to anticipate further price gains, the former holding a heavy long 77% bias and the latter an extreme long 91%, with a big reduction in long positions by 30,399 lots larger than the 882 lot reduction in shorts.

Gold chart with retail and institutional sentiment

Silver Technical analysis, overview, strategies, and levels

From a Weekly level’s standpoint, it was a week of little importance for silver traders, given its price failed to reach either pivot point. And on Thursday, while its price rose to breach its Daily 1st Resistance level, it offered little beyond it and testing its current volatile technical overview as financial markets in general start to calm down. There has also been little change in the gold/silver ratio, quietly retracing lower towards the end of last week, and there was relatively little change for the four precious metals that are usually experiencing more volatility.

IG client^* and CoT sentiment for Silver

A lack of change in price has done little to change sentiment, with retail bias still in extreme long territory, and with CoT speculator long bias rising slightly only due to a bigger reduction in shorts as a percentage of its total, down 3,218 lots compared to a drop in long positions by 6,027 lots.

Silver chart with retail and institutional sentiment

Oil Technical analysis, overview, strategies, and levels

While there wasn’t much of a story in precious metals, the focus was heavily on oil, as expectations of an output cut out of the oil majors turned into a blame game over the weekend, and a postponement in the emergency meeting to Thursday, and where tariffs on oil imports into the US and Canada haven’t been ruled out, especially as domestic oil producers in North America suffer with Baker Hughes US oil rig count plummeting for a third consecutive week (to 562 from 624 prior). Fundamentals will matter more for the energy commodity, and volatility expected to remain high especially following the outcome of the emergency meeting.

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IG client^* and CoT sentiment for Oil WTI

In sentiment, retail bias dropped by 14% into heavy long territory at 72%. CoT bias also dropped to 77% on similar 46K lot increases in both long and short positioning.

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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