Archive for Metals – Page 6

Gold Maintains Upward Trend as Market Anticipates US Jobs Data

By RoboForex Analytical Department

Gold prices have continued their ascent, with a troy ounce of the precious metal reaching USD 2363. This rise is primarily fuelled by anticipated US employment data for June, which could significantly influence the Federal Reserve’s rate decisions.

Recent US economic indicators, including a contraction in the service sector and weaker-than-expected private sector employment figures from ADP, have painted a dovish picture regarding the Fed’s upcoming monetary policy moves. These factors contribute to the prevailing sentiment that the Fed might lower interest rates, with market probabilities favouring a cut by September currently standing at 73%.

Furthermore, ongoing political uncertainties in Europe, especially in France and the UK, affect the EUR exchange rate, thereby impacting the USD and indirectly influencing gold prices. Additionally, persistent geopolitical tensions in the Middle East continue to drive demand for safe-haven assets like gold.

Technical analysis of XAU/USD

Gold (XAUUSD) is currently undergoing a correction that is anticipated to conclude at the level of 2370.70. Post-correction, the market might experience a decline towards 2295.00. A break below this could extend losses to 2222.22, setting a local target. This bearish potential is supported by the MACD indicator, which, although above zero, shows signs of peaking.

On the hourly chart, gold formed a tight consolidation around 2345.70 and breached the 2366.26 level upward, setting a local high. A corrective move down to 2345.70 is likely, followed by a potential rise to 2370.70, completing the current correction phase. Subsequently, the market might prepare for a new downtrend. The Stochastic oscillator, currently above 80, suggests an impending downturn, reinforcing the likelihood of a corrective decline.

Investors and traders will closely monitor the release of the US jobs report, given its potential to significantly sway Federal Reserve policy and, by extension, gold prices.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

COT Metals Charts: Speculator bets led by Platinum & Silver

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday June 25th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by Platinum & Silver

The COT metals markets speculator bets were overall higher this week as four out of the six metals markets we cover had higher positioning while the other two markets had lower speculator contracts.

Leading the gains for the metals was Platinum (4,739 contracts) with Silver (4,077 contracts), Gold (3,145 contracts) and Palladium (650 contracts) also showing positive weeks.

The markets with declines in speculator bets for the week were Copper (-2,495 contracts) with Steel (-201 contracts) also registering lower bets on the week.


Metals Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)


Strength Scores led by Silver & Gold

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Silver (95 percent) and Gold (87 percent) lead the metals markets this week. Copper (80 percent), Steel (74 percent) and Platinum (73 percent) come in as the next highest in the weekly strength scores.

On the downside, Palladium (6 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Gold (87.3 percent) vs Gold previous week (85.9 percent)
Silver (94.9 percent) vs Silver previous week (89.3 percent)
Copper (79.9 percent) vs Copper previous week (82.2 percent)
Platinum (73.0 percent) vs Platinum previous week (60.4 percent)
Palladium (6.2 percent) vs Palladium previous week (2.2 percent)
Steel (73.6 percent) vs Palladium previous week (74.4 percent)


Gold & Silver top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Gold (19 percent) leads the past six weeks trends for metals and is currently the only market with a positive trend score.

Palladium (-12 percent), Copper (-11 percent) and Platinum (-10 percent) lead the downside trend scores currently.

Move Statistics:
Gold (18.8 percent) vs Gold previous week (19.6 percent)
Silver (-4.8 percent) vs Silver previous week (-2.4 percent)
Copper (-10.9 percent) vs Copper previous week (-9.3 percent)
Platinum (-10.3 percent) vs Platinum previous week (5.9 percent)
Palladium (-12.3 percent) vs Palladium previous week (-15.1 percent)
Steel (-6.5 percent) vs Steel previous week (-9.0 percent)


Individual Markets:

Gold Comex Futures:

Gold Futures COT ChartThe Gold Comex Futures large speculator standing this week was a net position of 246,229 contracts in the data reported through Tuesday. This was a weekly advance of 3,145 contracts from the previous week which had a total of 243,084 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 87.3 percent. The commercials are Bearish-Extreme with a score of 14.5 percent and the small traders (not shown in chart) are Bullish with a score of 62.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Gold Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:63.019.110.7
– Percent of Open Interest Shorts:8.579.25.1
– Net Position:246,229-271,48825,259
– Gross Longs:284,88586,55148,436
– Gross Shorts:38,656358,03923,177
– Long to Short Ratio:7.4 to 10.2 to 12.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):87.314.562.1
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:18.8-16.1-8.5

 


Silver Comex Futures:

Silver Futures COT ChartThe Silver Comex Futures large speculator standing this week was a net position of 55,978 contracts in the data reported through Tuesday. This was a weekly boost of 4,077 contracts from the previous week which had a total of 51,901 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 94.9 percent. The commercials are Bearish-Extreme with a score of 2.7 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 90.5 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Silver Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:48.923.721.4
– Percent of Open Interest Shorts:15.372.16.6
– Net Position:55,978-80,71824,740
– Gross Longs:81,36639,37535,689
– Gross Shorts:25,388120,09310,949
– Long to Short Ratio:3.2 to 10.3 to 13.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):94.92.790.5
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-4.80.813.5

 


Copper Grade #1 Futures:

Copper Futures COT ChartThe Copper Grade #1 Futures large speculator standing this week was a net position of 50,126 contracts in the data reported through Tuesday. This was a weekly reduction of -2,495 contracts from the previous week which had a total of 52,621 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 79.9 percent. The commercials are Bearish-Extreme with a score of 16.6 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 92.4 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Copper Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:52.724.19.2
– Percent of Open Interest Shorts:33.148.54.4
– Net Position:50,126-62,46512,339
– Gross Longs:134,79861,57523,624
– Gross Shorts:84,672124,04011,285
– Long to Short Ratio:1.6 to 10.5 to 12.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):79.916.692.4
– Strength Index Reading (3 Year Range):BullishBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-10.96.227.0

 


Platinum Futures:

Platinum Futures COT ChartThe Platinum Futures large speculator standing this week was a net position of 20,603 contracts in the data reported through Tuesday. This was a weekly increase of 4,739 contracts from the previous week which had a total of 15,864 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 73.0 percent. The commercials are Bearish-Extreme with a score of 18.7 percent and the small traders (not shown in chart) are Bullish with a score of 73.9 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Platinum Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:56.223.112.7
– Percent of Open Interest Shorts:29.458.74.0
– Net Position:20,603-27,3526,749
– Gross Longs:43,19617,7239,788
– Gross Shorts:22,59345,0753,039
– Long to Short Ratio:1.9 to 10.4 to 13.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):73.018.773.9
– Strength Index Reading (3 Year Range):BullishBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-10.32.250.6

 


Palladium Futures:

Palladium Futures COT ChartThe Palladium Futures large speculator standing this week was a net position of -12,906 contracts in the data reported through Tuesday. This was a weekly increase of 650 contracts from the previous week which had a total of -13,556 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 6.2 percent. The commercials are Bullish-Extreme with a score of 92.0 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 87.9 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Palladium Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:30.553.98.0
– Percent of Open Interest Shorts:78.39.05.1
– Net Position:-12,90612,138768
– Gross Longs:8,22414,5582,158
– Gross Shorts:21,1302,4201,390
– Long to Short Ratio:0.4 to 16.0 to 11.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):6.292.087.9
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-12.311.38.7

 


Steel Futures Futures:

Steel Futures COT ChartThe Steel Futures large speculator standing this week was a net position of -5,944 contracts in the data reported through Tuesday. This was a weekly lowering of -201 contracts from the previous week which had a total of -5,743 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 73.6 percent. The commercials are Bearish with a score of 27.4 percent and the small traders (not shown in chart) are Bearish with a score of 28.1 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Steel Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:10.879.60.7
– Percent of Open Interest Shorts:32.657.70.9
– Net Position:-5,9445,983-39
– Gross Longs:2,93221,676200
– Gross Shorts:8,87615,693239
– Long to Short Ratio:0.3 to 11.4 to 10.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):73.627.428.1
– Strength Index Reading (3 Year Range):BullishBearishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-6.57.2-21.4

 


Article By InvestMacroReceive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

Gold gains, but lags 5 other FXTM commodities

By ForexTime

  • Gold edges up 0.2% today; still stuck in sideways range since April
  • Bullion’s year-to-date gains now at 13.1%
  • Bloomberg model: Gold may be range-bound for another month
  • Fed rate cuts, PBOC buying needed to trigger next leg up
  • 5 other FXTM commodities outperformed gold so far in 2024

 

Gold’s luster has been waning of late.

To be certain, the precious metal added to its 13% gains from 2023 with a further 13% so far in 2024.

Despite posting fresh record highs in recent months, gold’s gains have stalled since mid-April.

Notice how spot gold attempted to break above the $2430 line back in mid-April and mid-May.

Those intraday spikes however could not be sustained.

Although edging higher at the time of writing, gold has been trading back below its 50-day simple moving average (SMA) for the first time since February 2024.

 

Why has gold’s rally stalled?

1) Lowered bets for Fed rate cuts this year

Back in March 2024, markets were according up to a 92% chance that the Fed would lower its benchmark rates by a total of 75 basis points (three rate cuts of 25-basis points each) by year-end.

Recall that gold offers no interest (zero yield) to holders of this asset. Hence, lower interest rates tend to reduce the opportunity cost of holding gold.

In other words, lower rates boost the appeal of zero-yielding gold.

But with markets now predicting just two rate cuts (25-bps each) by the Fed this year, that has curbed gold’s upside, though providing support for the precious metal in the interim.

 

2) PBOC halted gold purchases

A big driver of gold’s surge has been the persistent buying from major central banks, especially the People’s Bank of China.

The PBoC bought about 10 million troy ounces worth of the precious metal since November 2022, as it sought to pad up and diversify its foreign reserves.

However, on 7th June 2024, it was revealed that the PBoC halted its 18-month buying spree in May 2024.

That news triggered a 3.5% drop in spot gold and dragged prices well below the 50-day SMA.

 

 

What could make gold’s rally resume?

  • Fed rate cuts

As mentioned earlier, markets need greater certainty that the Fed can indeed press ahead with its intended rate cuts.

Given its stated “data dependent” stance, the incoming US jobs/inflation data may prompt gold bulls to charge on once again.

  • Central bank buying

The PBoC and other central banks may yet be compelled to return to the market, either due to a further need to increase their foreign reserves, or if lower gold prices prove attractive enough.

A resumption of their buying spree should give fresh impetus for gold to move higher once more.

 

 

How is gold expected to perform over the days/weeks ahead?

According to Bloomberg’s model:

  • 74% chance of $2286 – $2382 over the next one-week period
  • 73% chance of $2246 – $2439 over the next one month.

Contrasting the above forecasted ranges to current prices …

Gold appears to retain a downside bias, with less chance of posting a new record high by mid-July.

Such an outlook would be keeping with the downtrend (lower highs and lower lows) since its current record high of $2450.03 on May 20th.

The Fed is also unlikely to give more concrete signals about its policy intentions before these central bankers are shown another couple months’ worth of jobs/inflation data.

The next FOMC policy meeting isn’t slated until July 31st.

Hence, gold bulls might have to bide their time in the interim, and perhaps endure bouts of profit-taking that results in dips for spot gold prices.

 

 

How has the rest of the FXTM commodities complex performed?

FXTM recently launched 10 new commodities, adding to the ranks that already feature Gold, Silver, Brent (oil), Crude (US crude oil), and NatGas (Natural Gas).

While gold’s 13% in year-to-date gains is certainly notable, it still lags behind the year-to-date gains seen in Silver, as well as 5 of those new commodities:

  1. Cocoa: +136.8%
  2. Robusta: +34.3%
  3. Silver: +24%
  4. Arabica: +20%
  5. Copper: +16.8%

 

 

Certainly it has been a good year so far for commodity bulls, thanks to lacking supply and resilient demand across the global economy.

  • However, if the global economic outlook deteriorates, due to demand-destroying elevated interest rates, that could prompt these commodities to unwind these stellar year-to-date gains.
  • To the upside, should major central banks press ahead with their plans to lower interest rates, which is supportive of demand for these commodities, that could boost these commodity prices even higher.

Either way, traders who are primed and ready stand to reap sizeable trading opportunities along the way, either up or down.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

COT Metals Charts: Speculator Bets led lower by Platinum & Copper

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday June 4th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Bets led lower by Platinum & Copper

The COT metals markets speculator bets were lower this week as just two out of the six metals markets we cover had higher positioning while the other four markets had lower speculator contracts.

Leading the gains for the metals was Gold (717 contracts) with Steel (441 contracts) also showing a positive week.

The markets with declines in speculator bets for the week were Platinum (-5,001 contracts), Copper (-4,395 contracts), Palladium (-1,593 contracts) and with Silver (-780 contracts) also registering lower bets on the week.


Metals Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)


Strength Scores led by Silver & Copper

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Silver (96 percent) and Copper (90 percent) lead the metals markets this week. Gold (83 percent), Steel (82 percent) and Platinum (78 percent) come in as the next highest in the weekly strength scores.

On the downside, Palladium (5 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Gold (83.3 percent) vs Gold previous week (83.0 percent)
Silver (95.5 percent) vs Silver previous week (96.6 percent)
Copper (90.2 percent) vs Copper previous week (94.3 percent)
Platinum (78.3 percent) vs Platinum previous week (91.6 percent)
Palladium (5.3 percent) vs Palladium previous week (15.3 percent)
Steel (81.5 percent) vs Palladium previous week (79.8 percent)


Platinum & Gold top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Platinum (40 percent) and Gold (15 percent) lead the past six weeks trends for metals.

Palladium (-22 percent) leads the downside trend scores currently with Silver (-4 percent) as the next market with lower trend scores.

Move Statistics:
Gold (15.5 percent) vs Gold previous week (15.6 percent)
Silver (-4.1 percent) vs Silver previous week (5.3 percent)
Copper (2.5 percent) vs Copper previous week (16.7 percent)
Platinum (40.3 percent) vs Platinum previous week (24.9 percent)
Palladium (-22.1 percent) vs Palladium previous week (-12.9 percent)
Steel (-0.3 percent) vs Steel previous week (-6.1 percent)


Individual Markets:

Gold Comex Futures:

Gold Futures COT ChartThe Gold Comex Futures large speculator standing this week equaled a net position of 237,302 contracts in the data reported through Tuesday. This was a weekly rise of 717 contracts from the previous week which had a total of 236,585 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 83.3 percent. The commercials are Bearish-Extreme with a score of 16.8 percent and the small traders (not shown in chart) are Bullish with a score of 66.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Gold Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:63.618.611.1
– Percent of Open Interest Shorts:10.678.14.7
– Net Position:237,302-265,93128,629
– Gross Longs:284,56683,41849,807
– Gross Shorts:47,264349,34921,178
– Long to Short Ratio:6.0 to 10.2 to 12.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):83.316.866.1
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:15.5-16.014.9

 


Silver Comex Futures:

Silver Futures COT ChartThe Silver Comex Futures large speculator standing this week equaled a net position of 56,403 contracts in the data reported through Tuesday. This was a weekly decrease of -780 contracts from the previous week which had a total of 57,183 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 95.5 percent. The commercials are Bearish-Extreme with a score of 1.8 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 100.0 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Silver Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:49.323.019.9
– Percent of Open Interest Shorts:17.968.35.9
– Net Position:56,403-81,52025,117
– Gross Longs:88,60441,28035,798
– Gross Shorts:32,201122,80010,681
– Long to Short Ratio:2.8 to 10.3 to 13.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):95.51.8100.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-4.1-4.737.1

 


Copper Grade #1 Futures:

Copper Futures COT ChartThe Copper Grade #1 Futures large speculator standing this week equaled a net position of 61,127 contracts in the data reported through Tuesday. This was a weekly decrease of -4,395 contracts from the previous week which had a total of 65,522 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 90.2 percent. The commercials are Bearish-Extreme with a score of 6.0 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 100.0 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Copper Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:50.327.98.4
– Percent of Open Interest Shorts:28.854.33.6
– Net Position:61,127-74,71513,588
– Gross Longs:142,71279,24923,922
– Gross Shorts:81,585153,96410,334
– Long to Short Ratio:1.7 to 10.5 to 12.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):90.26.0100.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:2.5-7.335.0

 


Platinum Futures:

Platinum Futures COT ChartThe Platinum Futures large speculator standing this week equaled a net position of 22,566 contracts in the data reported through Tuesday. This was a weekly lowering of -5,001 contracts from the previous week which had a total of 27,567 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 78.3 percent. The commercials are Bearish-Extreme with a score of 16.6 percent and the small traders (not shown in chart) are Bullish with a score of 50.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Platinum Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:58.620.09.9
– Percent of Open Interest Shorts:35.149.24.1
– Net Position:22,566-28,1235,557
– Gross Longs:56,38919,2509,537
– Gross Shorts:33,82347,3733,980
– Long to Short Ratio:1.7 to 10.4 to 12.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):78.316.650.1
– Strength Index Reading (3 Year Range):BullishBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:40.3-35.5-27.9

 


Palladium Futures:

Palladium Futures COT ChartThe Palladium Futures large speculator standing this week equaled a net position of -12,672 contracts in the data reported through Tuesday. This was a weekly lowering of -1,593 contracts from the previous week which had a total of -11,079 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 5.3 percent. The commercials are Bullish-Extreme with a score of 94.8 percent and the small traders (not shown in chart) are Bullish with a score of 70.7 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Palladium Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:29.556.99.1
– Percent of Open Interest Shorts:80.37.97.2
– Net Position:-12,67212,189483
– Gross Longs:7,34214,1652,266
– Gross Shorts:20,0141,9761,783
– Long to Short Ratio:0.4 to 17.2 to 11.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):5.394.870.7
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-22.118.430.8

 


Steel Futures Futures:

Steel Futures COT ChartThe Steel Futures large speculator standing this week equaled a net position of -3,888 contracts in the data reported through Tuesday. This was a weekly advance of 441 contracts from the previous week which had a total of -4,329 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 81.5 percent. The commercials are Bearish-Extreme with a score of 19.6 percent and the small traders (not shown in chart) are Bearish with a score of 28.7 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Steel Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:17.477.41.3
– Percent of Open Interest Shorts:33.860.81.4
– Net Position:-3,8883,922-34
– Gross Longs:4,11118,328303
– Gross Shorts:7,99914,406337
– Long to Short Ratio:0.5 to 11.3 to 10.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):81.519.628.7
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-0.30.6-8.1

 


Article By InvestMacroReceive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

Gold prices reach 2368 USD amid speculation of Fed rate cuts

By RoboForex Analytical Department

Gold prices climbed to 2368 USD per troy ounce on Thursday, continuing the upward momentum for the second session. This surge comes as market expectations adjust to the likelihood of future interest rate cuts by the Federal Reserve, fuelled by recent employment data.

Data from ADP indicated that the number of private-sector jobs in the US for May increased less than expected, with April’s figures also revised downwards. This suggests a cooling but robust employment market, reinforcing speculation about impending rate cuts. According to the CME Group’s FedWatch tool, market participants anticipate two rate cuts in 2024, with a 70% probability of easing by September.

Attention is now turning to Friday’s comprehensive labour market reports from the US, which will provide further insights into the economic health and possible direction of monetary policy. Additionally, recent global movements by central banks, such as the Bank of Canada’s first rate cut in four years and the expected rate cut by the European Central Bank today, are influencing gold prices.

XAU/USD technical analysis

The H4 chart shows that gold has broken out of a consolidation range established above the 2315.00 USD level, moving upwards. The market is now poised to reach 2395.00 USD potentially. Once this target is met, a retraction to 2356.20 USD for a test from above could occur before another possible rise to 2399.00 USD. The MACD indicator supports this bullish outlook, with its signal line below zero but ascending sharply towards new highs.

On the H1 chart, gold developed a growth wave towards 2356.20 USD, followed by a consolidation range forming below this level. The market has since broken upwards, continuing the growth trajectory towards 2378.23 USD. After reaching this level, a corrective movement back to 2356.20 USD may occur, potentially setting the stage for a push towards the 2395.00 USD mark. The Stochastic oscillator indicates that, while the signal line has dipped below 80, it is expected to rise again towards 80, suggesting continued upward momentum.

Market outlook

Gold prices are experiencing a bullish phase, underpinned by shifting expectations regarding US monetary policy and actions by other central banks. Investors should closely monitor the upcoming US employment data and global central bank decisions. These events could significantly influence gold’s price dynamics in the short term. The technical indicators suggest a continuation of the current uptrend, with key levels to watch for potential reversals or further gains.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

COT Metals Charts: Weekly Speculator Changes led by Gold

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday May 28th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by Gold

The COT metals markets speculator bets were lower this week as just one out of the six metals markets we cover had higher positioning while the other five markets had lower speculator contracts.

Leading the gains for the metals was Gold with a total rise of 6,779 contracts for the week.

The markets with declines in speculator bets for the week were Copper (-6,172 contracts), Silver (-2,461 contracts), Palladium (-655 contracts), Steel (-314 contracts) and  Platinum (-82 contracts) also registering lower bets on the week.


Metals Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)


Strength Scores led by Silver & Copper

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Silver (97 percent), Copper (94 percent), Platinum (92 percent), Gold (83 percent) and Steel (80 percent) lead the metals markets this week and are all in Extreme-Bullish territory.

On the downside, Palladium (15 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Gold (83.0 percent) vs Gold previous week (79.9 percent)
Silver (96.6 percent) vs Silver previous week (100.0 percent)
Copper (94.3 percent) vs Copper previous week (100.0 percent)
Platinum (91.6 percent) vs Platinum previous week (91.8 percent)
Palladium (15.2 percent) vs Palladium previous week (19.3 percent)
Steel (79.8 percent) vs Palladium previous week (81.0 percent)


Platinum & Copper top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Platinum (25 percent) and Copper (17 percent) lead the past six weeks trends for metals. Gold (16 percent) is the next highest positive mover in the latest trends data.

Palladium (-13 percent) leads the downside trend scores currently with Steel (-6 percent) as the next market with lower trend scores.

Move Statistics:
Gold (15.6 percent) vs Gold previous week (12.3 percent)
Silver (5.3 percent) vs Silver previous week (8.9 percent)
Copper (16.7 percent) vs Copper previous week (27.0 percent)
Platinum (24.9 percent) vs Platinum previous week (23.1 percent)
Palladium (-12.8 percent) vs Palladium previous week (-10.4 percent)
Steel (-6.1 percent) vs Steel previous week (-10.5 percent)


Individual Markets:

Gold Comex Futures:

Gold Futures COT ChartThe Gold Comex Futures large speculator standing this week was a net position of 236,585 contracts in the data reported through Tuesday. This was a weekly gain of 6,779 contracts from the previous week which had a total of 229,806 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 83.0 percent. The commercials are Bearish-Extreme with a score of 18.8 percent and the small traders (not shown in chart) are Bullish with a score of 52.4 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Gold Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:59.122.510.6
– Percent of Open Interest Shorts:10.376.25.6
– Net Position:236,585-260,95024,365
– Gross Longs:286,737109,18151,528
– Gross Shorts:50,152370,13127,163
– Long to Short Ratio:5.7 to 10.3 to 11.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):83.018.852.4
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:15.6-15.611.3

 


Silver Comex Futures:

Silver Futures COT ChartThe Silver Comex Futures large speculator standing this week was a net position of 57,183 contracts in the data reported through Tuesday. This was a weekly fall of -2,461 contracts from the previous week which had a total of 59,644 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 96.6 percent. The commercials are Bearish-Extreme with a score of 2.3 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 100.0 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Silver Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:49.624.819.3
– Percent of Open Interest Shorts:18.768.76.4
– Net Position:57,183-81,07223,889
– Gross Longs:91,73045,93035,705
– Gross Shorts:34,547127,00211,816
– Long to Short Ratio:2.7 to 10.4 to 13.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):96.62.3100.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:5.3-8.018.1

 


Copper Grade #1 Futures:

Copper Futures COT ChartThe Copper Grade #1 Futures large speculator standing this week was a net position of 65,522 contracts in the data reported through Tuesday. This was a weekly decline of -6,172 contracts from the previous week which had a total of 71,694 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 94.3 percent. The commercials are Bearish-Extreme with a score of 4.3 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 90.9 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Copper Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:51.426.78.1
– Percent of Open Interest Shorts:29.552.44.3
– Net Position:65,522-76,75411,232
– Gross Longs:153,73979,82124,148
– Gross Shorts:88,217156,57512,916
– Long to Short Ratio:1.7 to 10.5 to 11.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):94.34.390.9
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:16.7-17.817.4

 


Platinum Futures:

Platinum Futures COT ChartThe Platinum Futures large speculator standing this week was a net position of 27,567 contracts in the data reported through Tuesday. This was a weekly reduction of -82 contracts from the previous week which had a total of 27,649 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 91.6 percent. The commercials are Bearish-Extreme with a score of 5.9 percent and the small traders (not shown in chart) are Bearish with a score of 29.8 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Platinum Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:62.318.910.1
– Percent of Open Interest Shorts:32.853.35.2
– Net Position:27,567-32,1404,573
– Gross Longs:58,27217,7259,420
– Gross Shorts:30,70549,8654,847
– Long to Short Ratio:1.9 to 10.4 to 11.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):91.65.929.8
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:24.9-22.7-10.8

 


Palladium Futures:

Palladium Futures COT ChartThe Palladium Futures large speculator standing this week was a net position of -11,079 contracts in the data reported through Tuesday. This was a weekly fall of -655 contracts from the previous week which had a total of -10,424 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 15.2 percent. The commercials are Bullish-Extreme with a score of 85.6 percent and the small traders (not shown in chart) are Bullish with a score of 65.6 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Palladium Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:26.555.78.8
– Percent of Open Interest Shorts:73.510.47.1
– Net Position:-11,07910,681398
– Gross Longs:6,25713,1392,078
– Gross Shorts:17,3362,4581,680
– Long to Short Ratio:0.4 to 15.3 to 11.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):15.285.665.6
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-12.810.123.3

 


Steel Futures Futures:

Steel Futures COT ChartThe Steel Futures large speculator standing this week was a net position of -4,329 contracts in the data reported through Tuesday. This was a weekly reduction of -314 contracts from the previous week which had a total of -4,015 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 79.8 percent. The commercials are Bearish with a score of 21.2 percent and the small traders (not shown in chart) are Bearish with a score of 29.0 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Steel Futures StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:13.279.81.2
– Percent of Open Interest Shorts:28.764.21.3
– Net Position:-4,3294,360-31
– Gross Longs:3,71922,396344
– Gross Shorts:8,04818,036375
– Long to Short Ratio:0.5 to 11.2 to 10.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):79.821.229.0
– Strength Index Reading (3 Year Range):BullishBearishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-6.16.5-10.5

 


Article By InvestMacroReceive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

Speculator Extremes: US Treasury Bond, Silver lead weekly Bullish Positions

By InvestMacro

The latest update for the weekly Commitment of Traders (COT) report was released by the Commodity Futures Trading Commission (CFTC) on Friday for data ending on May 28th.

This weekly Extreme Positions report highlights the Most Bullish and Most Bearish Positions for the speculator category. Extreme positioning in these markets can foreshadow strong moves in the underlying market.


To signify an extreme position, we use the Strength Index (also known as the COT Index) of each instrument, a common method of measuring COT data. The Strength Index is simply a comparison of current trader positions against the range of positions over the previous 3 years. We use over 80 percent as extremely bullish and under 20 percent as extremely bearish. (Compare Strength Index scores across all markets in the data table or cot leaders table)


Here Are This Week’s Most Bullish Speculator Positions:

US Treasury Bond


The US Treasury Bond speculator position comes in as the most bullish extreme standing this week. The US Treasury Bond speculator level is currently at a 98.8 percent score of its 3-year range.

The six-week trend for the percent strength score totaled 20.8 this week. The overall net speculator position was a total of 43,836 net contracts this week with a gain of 29,660 contract in the weekly speculator bets.


Speculators or Non-Commercials Notes:

Speculators, classified as non-commercial traders by the CFTC, are made up of large commodity funds, hedge funds and other significant for-profit participants. The Specs are generally regarded as trend-followers in their behavior towards price action – net speculator bets and prices tend to go in the same directions. These traders often look to buy when prices are rising and sell when prices are falling. To illustrate this point, many times speculator contracts can be found at their most extremes (bullish or bearish) when prices are also close to their highest or lowest levels.

These extreme levels can be dangerous for the large speculators as the trade is most crowded, there is less trading ammunition still sitting on the sidelines to push the trend further and prices have moved a significant distance. When the trend becomes exhausted, some speculators take profits while others look to also exit positions when prices fail to continue in the same direction. This process usually plays out over many months to years and can ultimately create a reverse effect where prices start to fall and speculators start a process of selling when prices are falling.


Silver


The Silver speculator position comes next in the extreme standings this week. The Silver speculator level is now at a 96.6 percent score of its 3-year range.

The six-week trend for the percent strength score was 5.3 this week. The speculator position registered 57,183 net contracts this week with a weekly decline of -2,461 contracts in speculator bets.


Copper


The Copper speculator position comes in third this week in the extreme standings. The Copper speculator level resides at a 94.3 percent score of its 3-year range.

The six-week trend for the speculator strength score came in at 16.7 this week. The overall speculator position was 65,522 net contracts this week with a decrease of -6,172 contracts in the weekly speculator bets.


Platinum


The Platinum speculator position comes up number four in the extreme standings this week. The Platinum speculator level is at a 91.6 percent score of its 3-year range.

The six-week trend for the speculator strength score totaled a change of 24.9 this week. The overall speculator position was 27,567 net contracts this week with a dip by -82 contracts in the speculator bets.


Mexican Peso


The Mexican Peso speculator position rounds out the top five in this week’s bullish extreme standings. The Mexican Peso speculator level sits at a 90.8 percent score of its 3-year range. The six-week trend for the speculator strength score was -3.3 this week.

The speculator position was 120,919 net contracts this week with an increase of 3,027 contracts in the weekly speculator bets.



This Week’s Most Bearish Speculator Positions:

Sugar


The Sugar speculator position comes in as the most bearish extreme standing this week. The Sugar speculator level is at a 0.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -19.3 this week. The overall speculator position was 5,105 net contracts this week with a reduction by-3,316 contracts in the speculator bets.


Swiss Franc


The Swiss Franc speculator position comes in next for the most bearish extreme standing on the week. The Swiss Franc speculator level is at a 0.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -14.1 this week. The speculator position was -44,366 net contracts this week with a decline of -3,721 contracts in the weekly speculator bets.


Brazil Real


The Brazil Real speculator position comes in as third most bearish extreme standing of the week. The Brazil Real speculator level resides at a 1.9 percent score of its 3-year range.

The six-week trend for the speculator strength score was -42.2 this week. The overall speculator position was -36,582 net contracts this week with a rise of 1,076 contracts in the speculator bets.


Canadian Dollar


The Canadian Dollar speculator position comes in as this week’s fourth most bearish extreme standing. The Canadian Dollar speculator level is at a 3.1 percent score of its 3-year range.

The six-week trend for the speculator strength score was -2.8 this week. The speculator position was -86,585 net contracts this week with a boost of 4,239 contracts in the weekly speculator bets.


5-Year Bond


Finally, the 5-Year Bond speculator position comes in as the fifth most bearish extreme standing for this week. The 5-Year Bond speculator level is at a 5.9 percent score of its 3-year range.

The six-week trend for the speculator strength score was -11.7 this week. The speculator position was -1,377,117 net contracts this week with an increase of 45,688 contracts in the weekly speculator bets.


Article By InvestMacroReceive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

Gold prices edge towards $2351 amid weakening US Dollar

By RoboForex Analytical Department

Gold prices are on an upward trajectory, moving towards 2351.00 USD per troy ounce on Tuesday. This marks a significant rise after days of sideways movement, highlighting the metal’s renewed appeal among investors.

This surge in gold prices can be attributed to a localised weakness in the US dollar, which has investors keenly anticipating the release of critical US inflation data later this week. The focus is particularly on the Core PCE indicator set for release on Friday, which is expected to provide further insights into the Federal Reserve’s potential interest rate adjustments.

The market’s reaction to the upcoming data could be pivotal, as strong movements in gold prices are likely once the Fed’s intentions on rates become clearer. To date, discussions on rate adjustments have been vague, leaving investors craving more definitive guidance.

Despite the Fed’s recent minutes suggesting a possibility of rate hikes due to persistent inflation, the market sentiment is tilted towards an eventual easing of the Fed’s stance, as indicated by the positive direction of short-term futures contracts on gold.

Technical analysis of XAU/USD

On the H4 chart of XAU/USD, a second downward impulse to the 2340.00 level has been formed. Today, a correction to 2358.50 has been executed. A downside movement to 2341.44 is expected, where a consolidation range may form. If the price breaks upwards from this range, a further correction towards 2384.80 could be considered. Conversely, a downward breakout could open the potential for a decline to 2318.80, the first target of the decline wave. This scenario is technically supported by the MACD indicator, with its signal line below zero and pointing strictly downwards towards new lows.

On the H1 chart, a decline to 2325.40 has been executed, followed by the formation of a growth structure to 2342.31. A consolidation range has formed around this level, with a correction wave to 2358.50, starting with an upward exit. Today, a decrease to 2342.31 (testing from above) has been executed. The new consolidation range is practically outlined. A downward breakout from this range could lead to another downward impulse to 2318.85. Further development towards 2384.50 is possible if the price breaks upwards, continuing the correction to 2384.85. Afterwards, a decline along the trend to 2318.85 is likely. This scenario is technically confirmed by the Stochastic oscillator, with its signal line having broken through 50 and continuing its decline to 20.

Summary

Gold prices are rising due to a weaker US dollar and anticipation of key US inflation data. Technical indicators suggest potential corrections and further declines, with significant support and resistance levels to monitor. Investors should closely follow the upcoming data and Fed communications for additional market direction.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Gold falls from highs

By RoboForex Analytical Department

The price of gold fell to $2370.00 per troy ounce by Thursday following the release of the minutes from the latest US Federal Reserve meeting. The general tone of the Fed’s policymakers was notably cautious, aligning with previous calls for a restrained approach to monetary policy.

The Fed indicated that more time is needed to be confident that US inflation is declining towards the 2% target. This cautious sentiment has tempered market expectations of imminent interest rate cuts. Previously, the market anticipated two rate cuts (in September and December); now, it expects no more than one. Consequently, the US interest rate is likely to remain at 5.5% per annum for an extended period before the Fed considers revising it.

Higher interest rates reduce the attractiveness of gold, which does not yield interest. This dynamic has contributed to the recent decline in gold prices.

Technical analysis of XAU/USD

On the H4 chart, XAU/USD has formed a downward impulse to the level of 2404.40, followed by a correction to 2433.90. The limits of the consolidation range are now well-defined, and the market has recently broken out downwards. This breakout opens the potential for a further decline to 2322.00. After reaching this level, a rebound to 2385.35 is expected. This scenario is technically supported by the MACD indicator, with its signal line above zero but directed strictly downwards towards new lows.

On the H1 chart, a decline to 2385.00 has been executed, followed by the formation of a consolidation range around this level. The market has recently broken out downwards from this range, opening the potential for a further decline to 2337.35, which is the local target. Following this, a correction back to 2385.00 (testing from below) is possible. Further decline towards 2321.45 may follow. This scenario is technically confirmed by the Stochastic oscillator, with its signal line above 20 and poised to rise to 50 before another potential decline to 20.

Summary

Gold prices have declined due to the Fed’s cautious stance on monetary policy and the expectation of prolonged high interest rates. Technical indicators suggest further potential declines, with possible corrective rebounds along the way. Investors should monitor these levels closely as market conditions evolve.

 

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Is a Scorching PM Sector Rally Ahead?

Technical Analyst Clive Maund explains why he believes a rally in precious metals, specifically gold and silver, may be imminent. 

Source: Clive Maund (5/20/24) 

The PM sector did exactly as predicted in the article WHEN THE RUBBER HITS THE ROAD – THE SCORCHING PM SECTOR RALLY AHEAD posted on the site about a week ago, with breakouts by metals and stocks last week from Flag / Pennant consolidation patterns into powerful uplegs. The purpose of this update is to inform you of the fact that THE REALLY BIG ACTION HASN’T EVEN STARTED YET, but it will soon, and we will proceed to see exactly why in this update.

Let’s start by reviewing what happened. Our first chart is the 6-month chart for gold and it’s interesting to see that while silver and PM stocks raced ahead last week, gold’s new upleg has barely gotten started and it has yet to break above the resistance at its early April highs — it will though and when it does it is expected to soar towards the upper rail of the uptrend channel shown and that implies further strong gains by silver and PM stocks in the days and weeks ahead.

Silver, however, showed no such hesitancy and broke out of its bull Flag and raced ahead, clearing the important psychological $30 barrier almost as if wasn’t there and as we can see on its 6-month chart it looks set for further gains as it has a ways to go before it reaches the upper rail of its uptrend channel.

We correctly anticipated this development and bought a raft of 6 SILVER STOCKS POISED TO ADVANCE about a week ago, all of which are up.

This break above $30 by silver was an important technical milestone for as we can see on the 20-year chart it means that it has cleared the important resistance established at this level back in 2020 and 2021 which means it now has its sights set on its 2011 highs at about $50 as its next major objective.

PM stocks meanwhile continued to forge ahead, especially on Friday, building on the breakout from the bull Pennant of May 9, as we can see on the 6-month chart for sector proxy GDX, which shows that they have plenty more upside before they arrive at the upper rail of their uptrend channel.

The 5-year chart makes clear the reason for the claim at the start of this article that THE REALLY BIG ACTION HASN’T EVEN STARTED YET, which is that, despite the gains so far, GDX is still some way from breaking out of the giant Head-and-Shoulders continuation pattern shown on this chart. The real action will start once GDX breaks above not just the neckline of the H&S pattern (the red line) but above the band of resistance that marks the upper boundary of the entire pattern and dates back to the 2020 highs.

Sentiment indicators continue to show that there is still little interest in the sector and a lot of skepticism, which is of course very bullish. This will change and change fast once GDX breaks above the key resistance, with a lot of investors coming down off the fence and piling in, driving a robust rally.

The 20-year chart for GDX is most interesting as it shows very clearly why the PM sector has such a huge upside from here. One is that GDX is still way below its 2011 highs, and this is despite gold having made clear new highs.

Gold is shown at the top of this chart and we see that it is romping ahead with a now very big positive divergence relative to PM stocks. This isn’t the way it is supposed to be — traditionally, during sector bull markets, stocks way outperform bullion for the obvious reason that with their high fixed costs, mines become vastly more profitable as gold continues to appreciate. What this means is that PM stocks have a lot of catching up to do — and the more gold (and silver) ascend, the more catching up there will be to do.

This is why PM stocks are expected to rip higher once GDX overcomes the resistance shown on this chart and the 5-year earlier.

Lastly, we will take a quick look at the dollar because of the increasing likelihood of a dollar collapse, which would be a big driver for strong gains not just by gold and silver but across the commodity complex generally.

So, let’s now take a quick look at a 20-year chart for the dollar index. On it, we can see that, so far, it hasn’t collapsed and has actually held up very well in the circumstances. In looking at this chart, we should keep in mind that as it is an index, it is a measure of the value of the dollar relative to other currencies and since all currencies are losing purchasing power, it doesn’t mean that because the dollar index has been more or less moving sideways since early 2023 it hasn’t lost purchasing power — it has a lot.

Going forward, if we see widespread dumping of Treasuries coupled with a buyer’s strike and the Fed aggressively monetizing new issues, as looks likely, it means that the dollar and the dollar index will drop and drop hard. This is why the sideways range of the past year or so is suspected to be some sort of bear Flag that will lead to renewed severe decline, as shown, and if it does, gold and silver and commodities will generally soar.

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Clivemaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks cannot be  only be construed as a recommendation or solicitation to buy and sell securities.