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The overall improvement is associated with the drop of the “ buy defense” narrative: Gold is no longer in favor, along with EUR and JPY. That might also be associated with the end of a rising seasonal cycle for Gold: usually, it consolidates during the May-July period, according to seasonal studies.
Crude oil, on the contrary, has a strong seasonal window to grow in May after dipping in April, so it’s possible to observe the price of WTI oil getting back to the fair price of $60 (that’s a price calculated by eia.gov)
Gold
Gold had probably finished its active phase of accumulation and has a chance of locking in a consolidation, here’s why:
Volatility (ATR) on the daily chart had reached the long-term peak: usually, it points to a market ending the active phase of the rally.
The net position of commercial traders from the COT report has been reaching new peaks on a week-to-week basis. Usually, that is associated with the declining price: the continuation of a price trend is unlikely in such circumstances, at least immediately.
From 25-year seasonal studies, Gold has completed the seasonal window of growth, and has a chance of being locked in a consolidation.
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