Silver Retail Strategy

Most UK brokers provide free sentiment data: IG Client Sentiment (free on website/platform), OANDA Order Book (for clients), Saxo TradingFloor. COT report is free from CFTC website. Social media (Reddit, Twitter) is free to monitor.

Daily check is sufficient for swing trading. Broker sentiment updates hourly but daily review catches extremes. COT is weekly (Friday release). Don't obsess over small changes - look for significant extremes (>75% or <30%).

Yes, especially in trends. Retail being moderately bullish (55-65%) in an uptrend is normal and often correct. The edge comes at EXTREMES (>75% or <30%) where retail is typically wrong. Don't trade against moderate sentiment.

Generally >75% long or >70% short is considered extreme. Compare to historical range - if current reading is in top/bottom 10% of past 1-2 years, it's extreme. Some use z-scores: >2 or <-2 is statistically extreme.

No - wait for price confirmation. Sentiment can stay extreme or get more extreme. Entry should be on reversal signal (candle pattern, divergence) at the extreme. Sentiment provides opportunity; price provides timing.

COT is weekly macro view; broker sentiment is daily tactical view. Best signal: Both showing same extreme. COT shows positioning across all exchanges; broker shows your platform's clients. Use COT for overall context, broker for timing.

This happens in strong trends. Don't fight trend on sentiment alone. Either: (1) Wait for price confirmation of reversal, (2) Wait for even more extreme sentiment, (3) Accept that trend may override sentiment. Trend + sentiment alignment is best.

Divergence (price and sentiment moving opposite) is a warning sign. Example: Price drops, sentiment gets more bullish = retail buying the dip = bearish. Stay with the divergence signal until sentiment normalizes or price confirms divergence resolved.

Exit when: (1) Sentiment returns to neutral (50%), (2) Technical target hit, (3) Stop loss hit, (4) Sentiment reverses significantly in your direction (extreme to neutral is most move). Don't wait for sentiment to flip to opposite extreme.

Less reliable than broker/COT data but useful for extremes. Extreme Reddit enthusiasm or Twitter hype often marks tops. Extreme despair marks bottoms. Use as confirmation, not primary signal. Qualitative not quantitative.

Combine inputs: Broker sentiment (40% weight), COT percentile (30%), social sentiment score (15%), ETF flows (15%). Normalize each to 0-100 scale. Calculate weighted composite. Backtest signals at composite extremes. Refine thresholds based on results.

Typically 1-4 weeks. Sentiment extremes take time to unwind. Shorter than 1 week may miss the full move. Longer than 4 weeks and the sentiment edge has usually dissipated. Backtest your specific system to optimize.

Options P/C ratio shows speculative and hedging activity. Very low P/C (bullish) combined with bullish spot sentiment = double confirmation. Options can sometimes lead spot positioning as informed traders use options. Skew shows tail risk pricing.

Watch for: Sentiment divergence intensifying, sentiment reaching new extremes, correlation between sentiment and price changing. Trending regime: Sentiment confirms price. Ranging: Sentiment marks edges. Transition: Sentiment diverges from price.

Realistic expectations: 55-65% win rate, 1.5-2.0 R:R average, profit factor 1.4-1.8, max drawdown 15-25%. Returns vary by market conditions. Sentiment works best in ranging/transitioning markets, less in strong trends. Expect periods of underperformance.