Oil rises on EIA deficit and easing of lockdown restrictions
Retail bias remains majority long anticipating further price gains.
Gold Technical analysis, overview, strategies, and levels
It was a mixed session for gold prices, ending higher as the US dollar weakened in the FX market but not by much as indices also finished in the green in a slight risk-on mood. Its price failed to reach either of its key pivot points, and on the economic front yesterday's US Federal Reserve (Fed) minutes showed policymakers reaffirming to keep rates near zero until the economy is back in recovery mode. We'll get the Fed's Chair Powell speaking later today, as well as US unemployment claims expected to show another significant figure. From a technical standpoint, all its main technical indicators continue to flash green, but a lack of intraday momentum has kept its price stuck near the highs.
IG client* and CoT sentiment for Gold
Retail longs continue to get tested by a lack of follow through in upside movement, and the bias has dropped slightly to 72% as a few run out of patience.
Gold chart with retail and institutional sentiment
Silver Technical analysis, overview, strategies, and levels
Although silver prices finished higher yesterday and outperformed against gold for another consecutive session, the gains were limiting and this morning it has suffered an early plummet to aid a conformist buy-on-reversal on yesterday's 1st Support level as its price partially recovers (thus far). The US dollar has been a relative underperformer in the FX market, but it has gained slightly this morning to put USD based pairs (and precious metals like this one) into slight retreat. From a technical standpoint, here too all its main indicators are flashing green with its price now that far off from its 200-day moving average which it crossed a few days ago.
IG client* and CoT sentiment for Silver
Retail bias is still in extreme long territory but as with gold, a few longs are getting impatience taking the bias a couple notches lower. Their bias is an extreme long 87% as of this morning.
Silver chart with retail and institutional sentiment
Oil Technical analysis, overview, strategies, and levels
Oil prices were in for another day of significant gain, aiding conformist breakout strategies (even after an early reversal it has recovered once more to surge higher again). EIA's (Energy Information Administration) oil inventories estimate was a significant 5m deficit, and on the lockdown front restrictions are easing further with all US states now at least partially reopened. Most of its technical indicators are flashing green and giving clear signs of a bull trend, but given the underlying volatility that has led to where prices are today, it might be a question of breakout vs. reversal than that of buy vs. sell.
IG client* and CoT sentiment for Oil WTI
Retail traders after recently shifting to majority long are holding onto that long bias despite the big price gains, with majority buy sentiment dropping only a notch to 59% since yesterday morning.
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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