Gold CoT long bias inches higher

Gold Technical analysis, overview, strategies, and levels

The price moves last Monday were enough to take it well above its Weekly key resistance levels, though was more oscillatory as the week progressed, testing breakout strategies on the Daily levels that while offered was relatively limiting in the general context of increased financial market volatility. Central bank easing, increased fiscal stimulus (which in turn means central banks financing that debt with printing), ongoing uncertainties, and the US dollar weakening significantly in the FX market have been factors aiding gold prices in finishing the week higher.

IG client^* and CoT sentiment for Gold

However, while traders usually attempt to take profit on a drop in prices, with gold the general bias remains for further upside gains. Retail bias is still in extreme long territory at 78%, and the latest CoT (Commitment of Traders) report shows larger speculators reducing short positions further, and taking majority long bias to an extreme 91%.

Gold chart with retail and institutional sentiment

Silver Technical analysis, overview, strategies, and levels

As with gold, silver prices spent much of the second half of last week in relative oscillation, not touching any of the key pivot points on the Daily later in the week but more than aiding conformist breakout strategies on the Weekly. The gold/silver spread dropped last week from the record highs posted the week before, but far more will be needed to come to the aid of short gold/silver spread traders who have wagered against gold outperforming its precious metal cousin. The real outperformer amongst the precious metals however, was palladium.

IG client^* and CoT sentiment for Silver

In sentiment, fresh retail long positions were quick to take profit, but the bulk of longs have been initiated at higher prices and to see a drop in retail bias below 80% will likely take a far greater increase in price. As for CoT bias, a drop in silver long positions by 8,138 lots has taken heavy long bias a few percent lower to 73%.

Silver chart with retail and institutional sentiment

Oil WTI Technical analysis, overview, strategies, and levels

Unlike the other products on this report where Weekly levels were broken, oil prices were relatively sedate in comparison remaining within its key pivot points, and testing sell breakout strategies on the daily levels as well on a lack of consistent follow through up until this morning’s gap lower. In oil data, Friday's Baker Hughes US oil rig count showed a significant drop to 624 from 644 the week before, of no surprise given the plummet in oil prices' effect on higher-cost rigs that can't operate at current price levels despite increased efficiency. Oil demand plummeting and supply surging has failed to offer a floor to oil prices just yet, with the only wild card thus far rising geopolitical tensions.

Learn more about oil trading.

IG client^* and CoT sentiment for Oil WTI

As for sentiment, retail bias is unchanged for the week at an extreme long 86%, with CoT speculators not that far off in terms of bias at 80% with increases in both long and short positioning on the week before.

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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