Oil CoT bias unchanged, gold rises

Gold Technical analysis, overview, strategies, and levels

Gold prices were in for volatile movement at the end of last week, breaching its 1^st Resistance level on the daily to aid conformist buy breakout strategies by the close. Overall for the week, it stayed within its Weekly pivot points as although all its main technical indicators are flashing green as its price hugs the highs, intraday follow through has been usually limiting as longs continue to await further upside movement. While the focus is on how high gold can go, we've been here before as longs get exposed to any potential downside squeeze.

IG client^* and CoT sentiment for Gold

Fresh longs are getting impatient on the lack of momentum, with heavy long bias amongst retail traders dropping from 70% to 66% on the price gain. Larger speculative traders according to the latest CoT (Commitment of Traders) report remain in extreme long territory, with an increase in gold longs by 13,423 lots and a simultaneous reduction in shorts by 2,312 lots taking it up a notch to 84%.

Gold chart with retail and institutional sentiment

Oil Technical analysis, overview, strategies, and levels

Oil prices are back at a short-term resistance level in a week that sent the energy commodity's price breaching last week's daily and weekly levels, the former's 2^nd Support managing to hold somewhat. Conformist breakouts outperformed after what had been some oscillatory sessions that tempted contrarian reversals into making a play. In oil data, Baker Hughes oil rig count for the US showed another consecutive drop, this time around to 189 from 199 the week before. Tomorrow's preliminary manufacturing PMIs (Purchasing Managers Index) will be noted within the context of economic reopening, but so too will rising coronavirus cases.

Learn more about oil trading.

IG client^* and CoT sentiment for Oil WTI

The price gains have tempted longs into closing out and shorts into initiating at the resistance level, with the heavy long 67% bias amongst retail traders dropping to just 52%. CoT speculators are unchanged at an extreme long 82% with a reduction in longs matched (in percentage terms) with a smaller reduction in shorts.

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.

Be sure to request IG’s Weekly & Daily Market Report when you open an account with IG Dubai and get access to the full information on the FX majors, commodities, indices, and Bitcoin.