Risk-on play and stronger dollar keep precious metals at bay
Gold and silver both finish lower with the latter underperforming while oil finishes close to where it started despite US oil inventories surplus.

GOLD: Risk-on play and a stronger dollar sends the pair’s price lower
There are plenty of reasons gold's price had previously managed to lift itself back up and show signs of a bull trend in line with its weekly outlook that is far more bullish, including (1) US yields suffering, (2) US Federal Reserve (Fed) rate cut likelihoods rising to majority price in another one next month, and (3) geopolitical tensions that have failed to subside. However, the reversal was swift as a limited US-Japan trade deal and positive comments on a possible US-China trade deal gave equities a finish higher, sent US yields rising, and put the safe haven precious metal in retreat. And with the US dollar outperforming, it was a swift reversal back below short-term moving averages. Retail bias has surged by 11% to a heavy long 72%, as longs failed to put stops and held on anticipating a move back higher. Tier 1 US data awaits with Gross Domestic Product (GDP) figures tonight and durables tomorrow, of greater importance given what is now considered to be a data-dependent Fed.

SILVER: Underperforming as USD correlation returns
It’s been a more difficult pair to understand as of late, as Tuesday’s USD weakness didn’t translate into any strength for the pair’s price, while yesterday’s greenback surge sent it back down below all its main short-term moving averages. Retail bias was at an extreme long 85% yesterday morning and is a couple notches higher to 87%. Overall, while the movement here is sharing some similarities with gold, it’s experiencing more cases of unexplained volatility, making reversals and breakout strategies more ideal than fading ones.

OIL – US CRUDE:
It's a closely watched commodity under normal circumstances, but with geopolitical tensions failing to subside in the background and short-term risk-on plays in the equities market, the focus has been more on the short-term certainties than long-term likelihoods. In terms of economic data, Energy Information Agency's more encompassing estimate of US oil inventories showed a 2.4M surplus following expectations of a slight 0.3M deficit and similar to the day before's American Petroleum Institute's (API) 1.4M surplus. And while that translated into early price drops, it did manage to recover by the end of the session thanks to a risk-on play. An item to note: all its main long-term moving averages are close to each other, so it’s easy for a cross to occur like yesterday where it went beneath all of them and recovered back up.

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