Precious metals plummet as short-term negative outlook bruises long-term bullish technicals
Gold, silver, and oil all lag for the session as short-term outlook remains negative.

GOLD: Suffering heavily on Monday as long-term bullish technicals get hit
It was a tough day for precious metals yesterday with the price moves opposite the weekly’s stalling bull trend outlook, but traders who are buying on reversal avoided getting stuck given yesterday’s weekly 1st Support level of 1475.88 was due to be on a reversal which didn’t pan out. On the daily chart, it has crossed below its 50-day moving average (MA) and broken beneath its short-term support level, piercing the lower end of the band in the process. The daily outlook is showing heavier negative technical bias as the greenback continues to outperform and equities – despite trade uncertainties and recessionary fears – remain close to the highs. In sentiment, retail bias has dropped but remains heavy long at 70%, well below institutional bias of an extreme long 86% that is taking a heavier hit.

SILVER: Negative technical bias forming on the daily as long-term bull trend line breaks
As with gold, its stalling bull trend on the weekly has suffered significantly, with much of the recent movement (up and down) unexplained. However, reversal strategies are more preferred in times of increased volatility, and yesterday’s weekly 1st Support level that got broken didn’t offer a buy reversal opportunity, opting to continue dropping. A negative Directional Movement Index (DMI) cross occurred yesterday on the daily and its price is back below its 50-day MA and short-term support level. As for retail bias, extreme long sentiment is down only a notch to 87% and getting squeezed on the recent fall.

OIL – US CRUDE: Falling as an absence of supply side shocks keep dented demand factors in focus
Weekend geopolitical tensions failed to lift oil prices higher, and neither did production figures out of OPEC for September that showed it dropping to a near decade low as demand-side factors keep energy prices at bay despite a chance of a supply side shock. Tonight’s release out of the American Petroleum Institute (API) will be followed by Energy Information Agency’s (EIA) more encompassing estimate tomorrow will affect the energy commodity in the context of supply, and manufacturing data today will affect the commodity in the context of demand. As for sentiment, both retail and institutional bias are at an extreme long 84%, the former raising their bias by 6% as shorts take profit and longs continue to get squeezed.

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