Sell-in-May then go away means that volumes tend to be light during this time. Add the public holidays in the US and in the UK this week, plus month end rebalancing, the variables add to further volatility.
It therefore does not come as a surprise that the latest positioning report, covering activity as of Tuesday last week, shows most positions being cut. Both long and short positions for gold, platinum and palladium showed declines, UBS said.
The short-covering in gold more than offsets long liquidation, resulting in net positioning increasing modestly by 0.51 million ounces.
Platinum and palladium net positions fell as long liquidation outweighed short-covering.
Silver shorts were the only outliers which showed a small increase of 1.89 million ounces, which combined with long liquidation resulted in silver net positioning falling by 7.72 million ounces.
Overnight, copper rose 0.6 per cent but the broader base metal complex was down 1 to 2 per cent.
Sources: Bloomberg, UBS