“Index of fear” shows that the group of commercials gradually comes out with a long position, open interest is reduced, the price gradually returns to the range of the flat.
Correlation with the ES 500 index shows that the ES 500 index after correction will resume its growth.
Slightly above the level of $ 3.2 was a strong sale (huge volume), which until the current day keeps the price below $ 3.2. The open interest begins to rise, while we expect a further fall to the level of $ 3 (which will show further price behavior).
In general, we can confidently say that the short position of the Commercial strongly stopped the growing trend.
Continues to develop flat at a level of $ 60 – $ 70. Open interest begins to decline a little. Considering the weakening dollar – the price of oil can grow impulsively to $ 70.
The Commercal Group is gaining an extremely short maximum position (more than in 2014). It is likely the formation of a flat in the region of $60- $70.
Next you need to watch the open interest.
Last year and the beginning of this year, gold was under an important area of resistance ($ 1340- $ 1360), which was formed in 2016.
Group Commercial under this area of resistance is still beginning to gain a short position (the growth of open interest is confirmed).
After a huge volume released last week, the price began to decline. The 10-year chart shows that this is the key level of resistance.
Anticipation of further decline to support level of $ 2.9
Since the last post Commercial twice built up a short position – both times VIX sharply soared above 11.5 points, followed by returning to 9 points.
Both times, the index e-mini SP500 does not fall below the previous low – positive divergence.
At the moment, open interest is declining, possibly reducing volatility.
The situation on the futures contracts on natural gas today following …
… important level of $3.3 – $3.3.
Open interest Commercial only just started to grow, with the accumulation of long positions. When fixing prices above $2.9 it will be possible to talk about the end of a downtrend.
Further, expect the movement to $3.2
Copper futures stopped at the support level of $3.03, then grew to an estimated $3.2 and the breakdown of support.
Today, Commercial also reduces the short position (seen from the open interest reduction). We expect further stabilization of prices near the current level.
For a set of net shorts, gold needs to raise the price to at least 1300, attract new customers, sell them goods and continue to wait for the price drop.
Gold futures met expectations – the price touched $ 1300 twice, and, not being above this level, fell to the current level of $ 1250.
Commercial began to liquidate some short position, as evidenced by the reduction in open interest.
Now we need to see how the market behaves in the region of $1250 – $1240.