Precious metals end the week range-bound
Despite US dollar weakness, commodity prices remained relatively range-bound.
GOLD: Consolidatory moves as volatility fails to pick up
Despite last week’s volatility label on anticipated risk moves intraweek, gold’s price remained relatively sedate and range-bound as both dollar and equities were weaker at the end of the week. The pair still enjoys long-term positive technical bias as price is above all its main weekly moving averages, but safe haven appetite will need to improve as most of its technical indicators remain neutral, and with a negative Directional Movement Index (DMI) cross occurring on the weekly. The lack of movement offered retail longs little chance to close out, with heavy long bias down 3% since the start of last week. Institutional bias is dropping however, on a 15,013 lot reduction in gold longs and a simultaneous increase in short positions by 7,523 lots pushing extreme long bias a couple percent lower.
SILVER: CoT heavy long bias starts to drop while retail sentiment still in extreme long territory
As with gold, appetite for precious metals is dropping from a Commitment of Traders (CoT) standpoint, though still remains heavy long at 67%, dropping 3% from last week on a reduction in long positions by 5,004 lots and a simultaneous increase in shorts by 1,761 lots. Retail sentiment however, is little changed as the moves were relatively range-bound for precious metals in general. A negative DMI cross has occurred on the weekly here as well, and where some of its main technical indicators on the weekly (and all of those on the daily) are neutral.
OIL – US CRUDE: Range-bound movement as heavy long traders continue to await upside movement
Last week’s main ranges were never reached, though expectations are that should it reach, it could be on the back of any volatility and entice conformist breakout strategies over contrarian reversal ones. Friday’s worse than expected Gross Domestic Figures (GDP) out of China was somewhat offset with better than expected industrial production figures, though as it stands its dented global demand that is weighing in on the energy commodity’s price. In terms of the latest supply news, Baker Hughes US oil rig count release on Friday showed only an increase of 1 compared to last week’s 712 count. Lastly, the latest sentiment numbers show retail bias up a couple percent and back at extreme long levels, just as institutional bias starts to drop a notch to a heavy long 75% as longs get tested. However, both long and short positioning has increased, the former by 16,123 lots and the latter by 14,324 lots.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
React to volatility on commodity markets
Trade commodity futures, as well as 27 commodity markets with no fixed expiries.
- Wide range of popular and niche metals, energies and softs
- Spreads from 0.3 pts on Spot Gold, 2 pts on Spot Silver and 2.8 pts on Oil
- View continuous charting, backdated for up to five years
See opportunity on a commodity?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on a commodity?
Don’t miss your chance – upgrade to a live account to take advantage.
- Analyse and deal seamlessly on fast, intuitive charts
- Get spreads from just 0.3 points on Spot Gold
- See and react to breaking news in-platform
See opportunity on a commodity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
