Crude Oil Prices May Struggle to Extend Near-Term Advance

Talking Points:

  • Crude oil prices might onslaught to extend IEA-inspired gains in a nearby term
  • What will expostulate longer-term wanton oil cost trends? See a guide to find out
  • Gold prices might disremember US sell sales, UofM information as FOMC looms ahead

Crude oil prices continued to pull higher, with buyers clearly still speedy by an IEA direct foresee upgrade published progressing in a week. A series of teenager headlines might have combined to support. Output from China has reportedly forsaken to an eight-year low of 3.77 million barrels per day and correspondence with an OPEC-led prolongation cut intrigue is pronounced to have increasing to 96 percent in August.

Weekly Baker Hughes supply count statistics and a CFTC suppositional positioning news are still due to cranky a wires before a week-end, though these are frequency manly marketplace movers. While this clearly leaves a doorway open for upside continuation, investors might be demure to offer serve directional joining in a nearby tenure and opt for profit-taking, capping WTI gains during slightest until subsequent week.

Gold prices valid surprisingly volatile even as US CPI information showed acceleration accelerated some-more than economists approaching in August. The title year-on-year expansion rate purebred during 1.9 percent, a tip in 3 months. Median forecasts forked to a some-more medium 1.8 percent outcome forward of a release. The US Dollar also declined opposite a vital counterparts.

This response seems rather counter-intuitive, generally given a priced-in 2017 Fed rate travel opinion duly steepened and front-end Treasury bond yields rose in a CPI report’s aftermath. Perhaps investors saw a flitting of pivotal eventuality risk as an event to rebalance bearing to Fed-sensitive resources closer toward neutral forward of subsequent week’s much-anticipated FOMC process announcement.

From here, US sell sales and University of Michigan consumer confidence total enter a spotlight. Both are approaching to furnish signs of fading vigor, by upside surprises echoing extended alleviation in US information outcomes given mid-June seem like a graphic possibility. Only really thespian deviations seem expected to means a stir if markets are truly FOMC-focused during this theatre however.

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GOLD TECHNICAL ANALYSISGold prices continue to float above support in a 1317.62-21.51 area (23.6% Fibonacci retracement, trend line). A daily tighten subsequent it targets a 1295.46-99.25 section (38.2% level, double top) next. Alternatively, a annulment behind above a 14.6% Fib during 1335.24 exposes a Sep 8 high during 1357.50 anew.

Crude Oil Prices May Struggle to Extend Near-Term Advance

Chart combined regulating TradingView

CRUDE OIL TECHNICAL ANALYSISCrude oil prices are contrast a Aug 1 high during 50.40, with a daily tighten above that paving a approach for a plea of a May 25 tip during 51.97. Alternatively, a spin behind subsequent trend line resistance-turned-support during 49.10 exposes a Sep 11 low during 46.98.

Crude Oil Prices May Struggle to Extend Near-Term Advance

Chart combined regulating TradingView

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

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