Gold and silver surge, oil finishes in the green

Gold Technical analysis, overview, strategies, and levels

Breakout strategies in gold were once again the outperforming strategy, with its price breaching both of yesterday's key resistance levels in line with its current technical overview, and in the process taking its price above the last of its main long-term moving averages, the 50-day MA. Technicals however, have been of less relevance, as the conflicting moves have put many of its other indicators in neutral territory. There’s also the difference between the Comex future price and London’s spot price, as traders unable to purchase due to the London lockdown rushed to the nearest futures contract on the Comex which has far less liquidity due to its expiry in hopes of securing gold supplies. The certainty thus far has been a breaking of its key pivot points, and over the past few days has been to the upside and at last in favor of traders.

IG client^* and CoT sentiment for Gold

Retail long bias was in extreme long territory throughout this period, and while it dropped from 83% on Monday to 79% on Tuesday, it has failed to budget from its extreme long bias since standing unchanged at 79% as of today morning.

Gold chart with retail and institutional sentiment

Silver Technical analysis, overview, strategies, and levels

As good a day as it may have been for gold, it was an even better one for silver, with its price outperforming and in turn taking the gold/silver spread lower for a fourth consecutive session. No doubt a part of it has been down to USD weakness and a surge in equities, as well as physical shortages as buyers snap up both gold and silver bars in the current uncertain and central bank monetary easing atmosphere.

IG client^* and CoT sentiment for Silver

The net result for retail traders has been positive, with retail long bias dropping a notch to 92% but still in extreme long territory, and where far more will be needed to unwind those longs in profit given where they were initiated.

Silver chart with retail and institutional sentiment

Oil WTI Technical analysis, overview, strategies, and levels

Oil prices briefly breached yesterday's 1^st Resistance level on more than one occasion but both times offered little beyond it, despite bigger volatility in the FX, precious metals, and equities markets. That meant that unlike most other products in this report, contrarian reversals were outperformers instead. In oil data, API's (American Petroleum Institute) inventories estimate showed a surprise 1.25M deficit following last week's slight deficit, and up next we'll get EIA's (Energy Information Administration) more encompassing figure set to show a 2.9M surplus following last week's slight surplus. In all, expectations are for inventories to grow ever larger as oil giants keep pumping oil in greater numbers despite a clear reduction in global demand.

Learn more about oil trading.

IG client^* and CoT sentiment for Oil WTI

In sentiment, retail bias here hasn’t budged on the slight price increase, remaining unchanged at an extreme long 85%.

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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