After the growth of the short position (against the background of the growth of open interest) in December 2017, the bond rate fell sharply and stopped. On this drop, the commercial began to buy sharply (the growth of open ineterset confirms this).
It is possible to update the minimum bond price to the support №1 or to support №2, after which the price will go up.
“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.
The price, as planned, reached the target level of $ 3.5. After that, the price sharply returned to the starting point. This flat lasts from the end of 2016. A level break (Support # 1) $ 2.6 will mean a move to $ 2.1.
But, most likely, the price will reach $ 3.0 (mid-flat)
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
After fixing the price above $ 2.75 and pushing the price at high volumes above $ 3.0, the price stopped at a local resistance of $ 3.25.
We still expect further price growth.
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.