Oil gaps lower this morning as travel restrictions rise
Both CoT long and short positioning drops in gold, silver and oil, trader bias remains extreme long.
Gold Technical analysis, overview, strategies, and levels
Last Week’s Weekly Support levels were quickly breached on Monday aiding conformist technical overview strategies that have been a boon for short-term momentum based strategies, as the precious metal's price struggled to remain above the $1,500 mark. The latest moves have run contrary to ongoing central bank easing, with the ECB (European Central Bank), BoE (Bank of England), and RBA (Reserve Bank of Australia) introducing quantitative easing and/or reducing rates last week, and is more suggesting of USD illiquidity as well as a move against extreme long traders, with retail bias at an extreme long 83% and CoT (Commitment of Traders) speculators at 90% with a reduction in gold long positions by 18,885 lots and a drop in shorts by 1,270 lots failing to move the percentage bias.
IG client* and CoT sentiment for Gold
Gold chart with retail and institutional sentiment
Silver Technical analysis, overview, strategies, and levels
Last Monday's plummet alone was enough to aid conformist breakout strategies to the downside befitting its current volatile technical overview, with its 50-week moving average failing to cross above its 200-week moving average, and a negative DMI (Directional Movement Index) cross occurring on the weekly. Gold was the precious metal that outperformed for the week not just against silver, but also platinum and palladium, even if silver managed to outperform towards the end of the week, it couldn't completely undo the record highs in the gold/silver spread, which started the week in the 105s and ended in the 118s.
IG client* and CoT sentiment for Silver
Retail bias is extreme long and heavily squeezed by the latest moves, while larger speculative traders according to the latest CoT (Commitment of Traders) report reduced both long and short positioning, to the tune of 13,902 and 10,923 lots respectively.
Silver chart with retail and institutional sentiment
Oil WTI Technical analysis, overview, strategies, and levels
Oil prices continued to move in line with its current volatile technical overview, and once again conformist sell breakout strategies were the outperforming strategy for the week (its price never reached last week’s Weekly 1st Resistance level). All its key technical indicators continue to flash red, and its 50-week moving average (MA) crossed below its 200-week MA. In oil news, the US is considering sending an energy envoy to Saudi Arabia, as regulators in Texas considered curbing production. The lower oil prices have already translated into worse oil data, with Friday’s Baker Hughes US oil rig count showing a drop to 664 from 683 prior.
IG client* and CoT sentiment for Oil WTI
The lower price moves have continued to test oil traders, with retail bias in extreme long territory at 86% and CoT bias rising to 81% on a larger reduction in oil short positions over long positions.
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.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Be ready to act on Bank of England announcements
Take a closer look at the potential effects of the BoE’s interest rate announcement, ahead of the next Monetary Policy Committee (MPC) meeting on 6 May 2021.
- What was decided at the last BoE meeting?
- How does the MPC influence inflation?
- How might the pound be affected by the next meeting?
Live prices on most popular markets