CoT bias remains heavy long for precious metals and oil
Safe haven precious metals stall at the highs, oil gains slightly thanks to risk-on week.
GOLD: Bull trend continues to stall as safe haven appetite waned last week
Although the US dollar lagged last week against most of the FX majors, gold’s price suffered losses after briefly breaching past last week’s weekly 1st Resistance level. That has been due to a slight reduction in trade and geopolitical risks and aiding risk appetite for equities. However, it hasn’t been enough to undo its current bull trend technical overview that is stalling on both the weekly and daily. Furthermore, rate expectations out of the Fed have dropped, and that’ll make non-yielding assets like the precious metal less precious as investors favor a yielding USD asset. In terms of bias, institutional bias hasn’t changed from its extreme long 85% with gold longs up by 2.8K lots and gold shorts reduced by 1K lots. As for retail bias it has increased as longs hold on (and more initiate) and fresh shorts take profit.
SILVER: Fresh longs squeezed as price briefly breaches 19
Silver outperformed earlier last week, as its bull trend on the daily accelerated. However, as was warned last week, acceleration means increased volatility, and hence breakout strategies in both direction (upside or downside) tend to be more befitting since that acceleration is expected to come to a halt and an eventual retracement is underway. At this stage, on the weekly, its still a bull trend that is outperforming that of its precious metal cousin gold. In the process, retail bias has risen back up towards the extremes standing now at 84% and up 5% since the start of last week (and up 8% since Thursday). Institutional bias is also up but stands at a lower 71% long due to an increase in longs by 1.5K lots and a reduction in shorts by less than 1K lots.
OIL – US CRUDE: Consolidatory moves befitting its consolidatory overview
As it stands, the energy commodity’s price is resting at the upper end of its bear trend channel on the weekly chart, whereby nearly all its main technical indicators are neutral but with a trending ADX. Demand side factors are what has taken it higher as last week’s improved risk appetite aided the pair’s price, and with supply side factors continuing to be tested with EIA’s worse than expected 4.8M deficit last Thursday and Baker Hughes’ US oil rig count dropping to 738 from 742 prior. Retail bias briefly shifted during the week to majority short, but now stands close to the middle as range-trading longs take profit on the way up. Institutional bias is little changed at an extreme long 80% with a reduction in longs by 4.5K lots and a rise in shorts by 3K lots.
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