PEC+ talks up oil prices
Oil prices rallied strongly yet again overnight, with Brent crude up almost 9.0% from its lows for the week. Overnight, the OPEC+ monitoring committee reiterated their commitment to maintaining production-cut discipline and threatened form action for recalcitrant members of the grouping.
Adverse weather events also helped the price rises in America’s oil-producing and refining South. Although Hurricane Sally has passed, it has left behind extensive flooding, and more tropical depressions are forecast to be on their way. That should keep a weather floor under WTI prices in the near-term.
Brent crude rose 2.30% to USD43.30 a barrel overnight, with WTI climbing through its 200-DMA, increasing 2.0% to USD40.90 a barrel. Brent crude will find resistance at its 50-DMA at USD43.70 a barrel, with support at USD41.60, its overnight low. WTI is testing resistance at its 50-DMA today at USD41.10 a barrel, with support now at its 200-DMA at USD40.20 a barrel. Further resistance is at USD42.00 a barrel.
With both Brent and WTI nearly 10% higher over the week, the best of the supportive news is likely now baked into spot prices. Further substantial gains from these levels will be harder going. The fundamentals weighing on prices, falling consumption outlooks, an excess or immediate supply, and the end of the US driving season remain unchanged and should reassert themselves at these levels.
Gold remains in no man’s land
Gold faded in overnight trading, falling by 0.80% to USD1944.00 an ounce. Like currency and equity markets, gold traders appear to have gone into the FOMC meeting long, and we are continuing to see a reduction in speculative long positioning.
Gold has risen with equities in Asia, climbing 0.40% to USD1951.50 an ounce, but in the bigger picture, remains rangebound between USD1920.00 an ounce, and USD1973.00 an ounce. We expect this state of affairs to continue into the weekend, with the gold off investors’ radars for now, and speculative interest reduced. A further period of consolidation looks likely into next week.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Recommended Content
Editors’ Picks
EUR/USD holds gains near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.