Gold Prices Aim Higher as Fed Rate Hike Bets Continue to Wilt

Talking Points:

  • Gold prices extend gains as Fed rate travel conjecture continues to wilt
  • Crude oil cost convene fades as API reveals register build, EIA information next
  • What will expostulate wanton oil and bullion prices by Q3? See a forecasts

Gold prices continued arise as Fed rate travel bets wilted, promulgation a US Dollar reduce alongside front-end Treasury bond yields and boosting a relations interest of non-interest-bearing and anti-fiat assets. Markets now cost a luck of another travel before year-end during 42.3 percent, down from 49.1 percent a week ago. A serve unwinding of a “Trump trade” seemed to be logic du jour.

From here, a peace in scheduled eventuality risk moulding tellurian produce trends competence interpret into converging for a yellow metal. Monetary process announcements form a BOJ and a ECB are a subsequent vital rhythm points, though those will have to wait until Thursday. News-flow from Washington DC stays an ever-present source of intensity sensitivity however.

Crude oil prices managed an intraday rebound notwithstanding news that Ecuador withdrew from a OPEC-led prolongation cut intrigue amid reports that Saudi Arabia is mulling a serve trade rebate of 1 million b/d. The conglomeration also invited Libya – so distant free from concurrent outlay cuts – to a plan assembly in St. Petersburg on Jul 22. That stoked conjecture that it competence be brought into a fold.

The convene fell detached however as API reported that US inventories combined 1.63 million barrels final week. Official EIA information is approaching to uncover a 3.5 million tub drawdown over a same period. If that outcome registers closer in line with a API projection, a WTI benchmark competence face serve offered vigour as a prospects for tellurian oversupply rebate darken.

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GOLD TECHNICAL ANALYSISGold prices rose for a third uninterrupted day, breaching insurgency noted by a 38.2% Fibonacci retracementat 1239.60. The subsequent upside separator comes in during 1250.38, a 50% level, with a serve pull over that aiming for a 61.8% Fib during 1261.16. Alternatively, a pierce behind subsequent 1239.60 – now recast as support – exposes a 23.6% retracement during 1226.26 anew.

Gold Prices Aim Higher as Fed Rate Hike Bets Continue to Wilt

Chart combined regulating TradingView

CRUDE OIL TECHNICAL ANALYSISCrude oil prices sojourn stranded subsequent insurgency during 47.10, a 38.2% Fibonacci retracement. A mangle above that reliable on a daily shutting basement targets a 50% turn during 48.65 next. Alternatively, a annulment behind subsequent draft rhythm indicate supportat 45.32 opens a doorway for a retest of a May 5 low at 43.79.

Gold Prices Aim Higher as Fed Rate Hike Bets Continue to Wilt

Chart combined regulating TradingView

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

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