Silver plummets to 11-year lows, Gold and oil plunge
Extreme long bias amongst traders severely tested in current market rout.
Gold Technical analysis, overview, strategies, and levels
Gold prices were in for another shock, with its price plummeting well past yesterday's Weekly Support levels, and in line with its volatile technical overview whereby conformist breakout strategies (anticipating pivot point breaks) have been the clear outperformers. Its price is now below all its main moving averages (MA) save the 200-day MA which it crossed yesterday, and a negative DMI (Directional Movement Index) cross occurred last Friday. This has been despite the US Federal Reserve's decision to reduce rates to the 0-0.25% range and introduce quantitative easing in what was a 'sell everything' moment.
IG client* and CoT sentiment for Gold
That spells bad news for both retail and larger speculative traders according to the latest CoT (Commitment of Traders) report, with both holding extreme long bias and for the former stop outs triggered as sending the bias to 76% as of today morning.
Gold chart with retail and institutional sentiment
Silver Technical analysis, overview, strategies, and levels
Although gold's plummet was in focus yesterday, its percentage drop paled into comparison compared to silver prices, whose prices were in for a shock in line with its volatile technical overview that sent its price plummeting further into the red to 11-year lows and well below its weekly support levels in line with conformist breakout strategies befitting its current volatile technical overview. With silver dropping more, the gold/silver ratio rose to fresh record highs above 122 before retracing into the 116s, but also hit was platinum with its price touching lows unseen in 11 years.
IG client* and CoT sentiment for Silver
Here too, both retail and CoT traders are holding heavy to extreme long bias, the former's 94% extreme long bias as of yesterday dropping to 92%.
Silver chart with retail and institutional sentiment
Oil WTI Technical analysis, overview, strategies, and levels
With equities in freefall and assets getting liquidated, oil prices weren't spared the rout as an oil price war combined with a travel sector in serious decline has meant that oil prices have been tested severely, with the energy commodity's price breaking through its Weekly 1st Support level. Contracting Chinese data didn't help either, and expectations are for data to significantly worsen in the months to come. While API (American Petroleum Institute) will be releasing its oil inventories figure tonight expected to show a sizeable surplus, it means less in the face of the current coronavirus storm and its effect on fundamentals.
IG client* and CoT sentiment for Oil WTI
In sentiment, extreme long retail bias at 83% yesterday morning now stands ever higher at 85%, below that of institutional traders at a heavy long 75% also getting squeezed on the recent price declines.
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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