Analytics

Oil prices surges to fresh late-October highs during the previous session before steadying on Wednesday. Brent crude climbed to the $89.30 area before retreating marginally. The fact that oil futures refrain from a deeper pullback despite overbought conditions suggests that traders may be ready to continue buying after pause.

In part, Brent rallied to its highest level in seven months amid concerns about mounting tensions in the Middle East following an airstrike on Iran’s embassy in Syria, with ongoing Ukrainian attacks on Russian refineries adding to worries. Also on the positive side, there are signs that oil demand in China may be picking up as the country’s official PMI showed the first expansion in manufacturing in six months.

Elsewhere, the API reported that crude oil inventories in the United States fell by 2.286 million barrels for the week ending March 29 versus a draw of 2 million barrels expected after a nearly 10-million-barrel jump in the week prior. Meanwhile, the DoE reported that crude oil inventories in the SPR rose by another 0.6 million barrels last week, to reach the highest point in a year.

Bulls target the $90 handle

As Brent crude has settled slightly above the $89 figure on Wednesday, traders may continue to target the $90 handle in the near term. The upside potential persists at this stage, especially as the US dollar struggles to extend the recent rally. The USD index has steadied on Wednesday after rallying to mid-November highs during the previous session.

On the other hand, a failure to retest the $89.30 region could bring some short-term bearishness back into play, which, however, could become another buying opportunity for the bulls. On the flip side, the $88 mark represents the immediate significant support at this stage, followed by the $87.35 zone.

The bitcoin price holds slightly negative on Friday, oscillating around the $70,000 psychological figure after a retreat from all-time highs seen in the $73,700 area earlier this month. On the weekly charts, the BTCUSD pair looks set to finish with solid gains after two weeks of losses in a row. As such, the largest cryptocurrency by market capitalization shows recovery from a partial pullback from the mentioned all-time highs seen amid the growing inflows in the Bitcoin Spot ETFs.

Bitcoin looks relatively resilient in anticipation of the halving event, with market sentiments towards the coin turning more bullish again. Halving occurs roughly every four years. Per-block mining rewards are set to drop from 6.25 BTC to 3.125 BTC on or around April 20. Ahead of the event, market players could take advantage of buying opportunities and set themselves up for future growth.

Downside potential limited

In the near term, the digital currency needs to settle above the $71,000 figure in order to retarget the mentioned all-time tops. On the downside, the nearest support now arrives in the $69,000 region. A failure to hold above this zone would pave the way to a deeper retreat below the $64,000 figure. However, the downside potential looks limited at this stage, with the overall bullish trend persisting.

In a wider picture, the BTCUSD pair could climb to fresh all-time highs in the weeks to come, with the $74,000 figure representing the next target for the bulls. In this scenario, more traders will start to bet on a rally towards the $100,000 amid the halving event. On the monthly charts, the digital currency keeps rallying for the seventh month in a row.

Gold prices rallied to fresh all-time highs above $2,200 last week. The bullion peaked at $2,225 before retreating from fresh tops amid some profit-taking. The XAUUSD pair stays relatively resilient on Wednesday, with prices clinging to the upper end of the extended trading range, struggling to resume the rally as the dollar looks steady at this stage.

The US dollar retains a modest bullish bias since yesterday after posting strong gains during the second half of last week. The greenback climbed to mid-February highs in the 104.50 area before retreating marginally. Still, the USD index remains elevated, holding above the 104.00 figure. A daily close above the 104.40 zone would bring some more short-term bullishness back into the game.

As for gold, the downside potential persists at this stage, as investors may take profit more aggressively after the spike. On the weekly timeframes, the technical picture stays positive, with wider picture remaining upbeat after reaching fresh all-time highs.

$2,150 in focus

On the upside, the immediate significant target is now represented by the $2,180 zone, followed by $2,200. Downside risks are limited while above the $2,100 region. Should dollar demand reemerge in the near term, the bullion may threaten the $2,150 support zone.

Later in the week, US PCE data could affect gold prices through the dollar’s reaction to the release. Should the figures exceed expectations, the greenback may rally as June rate cut expectations would ebb on a stronger-than-expected inflation. In this scenario, XAUUSD may lose some ground to further retreat from historical tops. A failure to hold above the $2,150-$2,145 zone would pave the way towards the $2,120 immediate support on the way towards $2,100.

Oil prices stay pressure for the third session in a row on Friday after a brief rally towards early-November highs earlier in the week. Brent crude peaked at $87.70 and has been retreating since then. Ahead of the weekend, oil futures have settled around $85.80, struggling for direction slightly above the flat line.

Brent is now pressured by the prospect of a ceasefire in the Middle East, a stronger US dollar, and some profit-taking after the recent gains. The US is set to table a United Nations draft resolution for an immediate ceasefire in Gaza.

Meanwhike, the USD index climbed to one-month highs to bounce aggressively after a dip in a knee-jerk reaction to a slightly dovish message from the Federal Reserve. Despite the rising inflation, the US central bank continues to forecasts three rate cuts this year. The resurgent demand for the dollar was in part driven by strong economic data out of the United States. In particular, purchasing managers index data showed on Thursday that manufacturing activity grew more than expected in March, while services remained in expansion.

Industry news support prices

On the positive side, US commercial crude stocks continued to fall last week as refinery run rates hit their highest levels since early January. According to data from the US Energy Information Administration, US crude oil inventories for the week ended Marср 15 decreased by 2.0 million barrels. As such, US crude oil inventories are about 3% below the 5-year average for this time of year. Furthermore, gasoline inventories decreased by 3.3 million barrels, while distillate fuel inventories increased by 600,000 barrels.

In other industry news, following the announcement that OPEC+ will extend the existing voluntary production cuts through the second quarter of 2024, the EIA increased its forecast prices for crude oil and petroleum products for the remainder of 2024 in its March Short-Term Energy Outlook. The organization reduced its forecast for world oil production in the second quarter of 2024 to 101.3 million barrels per day.

In the near term, Brent crude needs to hold regain the $86 figure that represents the immediate upside target for the bulls. On the downside, the nearest support now arrives around the $85 mark that capped losses during the previous session.

Bitcoin holds steady so far on Wednesday after a solid retreat witnessed during the previous session. The bearish bias dominates the cryptocurrency market since last week when the digital coin registered fresh all-time highs in the $73,600 area amid strong demand for spot Bitcoin ETFs. A failure to hold above the $70,000 psychological level triggered aggressive profit-taking that pushed the prices below $61,000 earlier today.

Now, it looks like bitcoin is suffering the inevitable correction before the digital currency could resume the ascent. Overnight, BTC saw the biggest single-day percentage decline since November 9, 2022, when FTX exchange went bankrupt. Amid outflows from the spot ETFs, prices have pulled back more than 15% from record highs reached last week.

Investors now shift focus towards the Federal Reserve rate decision, followed by Chairman Jerome Powell’s press conference later today. The meeting will give markets more insight into whether the central bank is still planning rate cuts this year. The Fed’s tone would affect currencies, stocks, and cryptocurrencies as well.

Buying opportunity

Despite the recent downturn in the cryptocurrency market, investors hopefully of await the upcoming halving event. In anticipation of the event, bitcoin's recent retreat from all-time highs looks like a buying opportunity. As such, traders now have a chance to reposition their risk before the halving event that will reduce the mining reward from 6.25 BTC to 3.125 BTC per block.

In the near term, the BTCUSD pair needs to hold above the $60,000 psychological level that represents the key nearest support at this stage. After an early dip to more than two-week lows, the largest cryptocurrency by market capitalization has settled around the $63,000 mark, holding in positive territory after a two-day slide. A daily close above $63,500 would mark some easing in the downside pressure surrounding the coin.

Gold prices slipped during the previous session as traders were spooked by stronger-than-expected US inflation data. February’s PPI rose 0.6% versus the expected gain of just 0.3%. Core producer price index climbed 0.3% in February versus a 0.2% expected. The reading came on the heels of a strong consumer inflation report earlier this week. The data spurred more concerns over higher-for-longer interest rates. Now, investors are getting fearful of more hawkish signals from a Federal Reserve meeting next week.

The hot US inflation report sent bond yields higher along with the US dollar, pressuring gold. The USD index bounced strongly during the previous session to finally regain the 103.00 figure. Earlier on Friday, the greenback extended gains towards the 103.50 zone that capped gains.

After notching fresh all-time highs above $2,200 last week, gold prices have been mixed these days, trending mostly lower amid the resurgent demand for the US dollar. In the process, the bullion slipped towards the $2,155 zone before bouncing marginally. Despite the recent profit-taking, the yellow metal keeps clinging to the upper end of the extended trading range.

Fed in focus

However, the downside potential persists at this stage, as investors may continue to take profit after the spike. On Friday, the XAUUSD pair is changing hands slightly above $2,170. On the weekly timeframes, the technical picture stays relatively positive, with wider picture remaining upbeat after reaching fresh all-time highs. On the upside, the immediate significant target is now represented by the $2,185 zone. Downside risks are limited while above the $2,100 region.

Potential buyers could be indecisive in the near term in anticipation of next week’s Fed meeting. Should the central bank deliver a more hawkish tone than expected, the dollar may rally across the board. In this scenario, gold would come under more intense selling pressure and may threaten the $2,150 support zone.

Following three days of losses, oil prices bounced on Wednesday as demand picked up slightly. However, the recovery momentum looks too modest at this stage to bet on sustained and decisive gains in the near term. Brent crude is up more than 1% for the day, holding just below the $83 figure that represents the immediate barrier for the bulls.

Earlier, oil was pressured by fresh economic data out of the United States. US consumer prices increased solidly in February, suggesting the Fed will not move to lower rates until June.

In industry news, US Energy Information Administration raised its 2024 outlook for domestic oil output growth by 260,000 barrels per day to 13.19 million barrels, versus a previously forecast rise of 170,000 barrels per day. The updated outlook added to bearish tone in the market. Meanwhile, the OPEC stuck to its forecast for relatively strong growth in global oil demand in 2024.

Brent keeps flirting with $83

According to the American Petroleum Institute, US crude stocks fell 5.521 million barrels last week. Gasoline inventories fell by 3.75 million barrels, and distillate stocks fell by 1.16 million barrels. A bullish report helped trim intraday losses overnight. Official US government data is due later in the day.

In the near term, Brent crude needs to regain the $83 mark that has been capping gains these days. Once above this hurdle, oil futures may target late-February highs in the $84.30-$84.35 region. However, should dollar demand continue to pick up in the days to come, oil prices may see another sell-off, with the $81 figure staying in the market focus. On the positive side, Brent has been holding above the $80 level for more than a month already, looking steady since early-February.

After peaking at fresh record highs in the $68,900 area earlier in the week, the bitcoin price retreated partially amid profit-taking. However, the coin refrained from a major correction to resume the ascent after a short-lived decline. On Friday, the BTCUSD pair has been rising for the third session in a row, oscillating around the $67,000 figure ahead of the weekend.

It looks like the largest cryptocurrency by market capitalization could extend the ascent both in the near- and medium term as the upcoming BTC halving event should complement the current demand from spot BTC ETF products. The technical picture is bullish as well, with the coin now holding above both the 50- and 200-DMAs, staying resilient despite overbought conditions.

Apart from industry factors, bitcoin derives support from a weaker dollar. The USD index slipped to mid-January lows earlier on Friday before bouncing marginally. The dollar stayed pressured as Powell’s relatively dovish comments sent benchmark 10-year Treasury yields to a one-month low. Focus is now on US employment data, with the consensus forecasting that 200,000 new jobs were created in February, well down from January’s 353,000.

BTC supported by rallying stocks and weaker USD

Should the report disappoint USD bulls, the digital currency may receive extra support ahead of the weekend. Positive risk sentiment would add to upbeat sentiment surrounding bitcoin. By the way, Wall Street stocks extended gains on Thursday to refresh all-time highs. The Nasdaq Composite added 1.5% as tech stocks took the lead, while the S&P 500 rallied more than 1% to hit another record closing high.

In the near term, BTCUSD needs to hold above the $67,000 level in order to stay afloat and make fresh bullish attempts in the coming days. Volatility has ebbed somehow since the latest rally, suggesting the coin could see some consolidation before deciding on the further direction.

Gold prices have steadied on Wednesday after a six-day rally that pushed the prices to fresh all-time highs in the $2,150 area during the previous session. The yellow metal saw a strong spike towards historical highs before retreating marginally. After the latest rally, gold prices stay upbeat.

The bullion attracted strong demand amid dollar’s retreat. The US dollar keeps trending lower this week, staying under modest bearish pressure for the fourth consecutive session. Last week, the greenback briefly peaked around 104.30 before attracting selling interest to settle below 104.00. The greenback looks bearish today, with the 103.90 immediate resistance staying in the market focus at this stage.

Despite persistent bullishness in the gold market, the downside potential is rising at this stage, as investors may proceed to profit-taking after the spike. Following peaking, the bullion has settled slightly below the upper end of the extended trading range.

$2,100 in focus ahead of US data

The XAUUSD pair stays above $2,100, struggling for direction so far. On the weekly timeframes, the technical picture turned positive, with wider picture staying upbeat after reaching fresh all-time highs. On the upside, the immediate significant target is now represented by the $2,150 zone. Downside risks are limited while above the $2,100 zone.

Later in the week, the precious metal could be affected by dollar’s reaction to a key US jobs report that will set the tone for markets ahead of the weekend. Should the release reveal a weaker employment growth after a spectacular rise in January, the greenback may extend the decline across the board, thus adding to gold’s positive momentum. A decisive break above $2,140 would pave the way to fresh record highs beyond the $2,150 yesterday’s top.

Oil prices are set to finish the week with gains, staying within a relatively tight trading range these days. Earlier in the week, Brent crude briefly peaked at $84.30 for the first time since late January, but failed to preserve gains and has retreated partially since then. During the European session on Friday, oil futures have settled around $82.70, adding nearly 1% on the day.

Oil traders are fairly optimistic in anticipation of OPEC+ decision. The alliance is widely expected to extend its production cap deal, tightening supply further. As a reminder, OPEC initially agreed to reduce combined supply by 2.2 million bpd over the first quarter. Some traders even expect the group to extend the cuts until the end of the year. The decision on extending production cuts is expected in the first week of March.

Mixed signals from industry and economy

In other industry news, the EIA report this week showed that US crude oil inventories rose by 4.2 million barrels in the week ending February 23, compared with expectations for a 2.7-million-barrel rise. On the positive side, gasoline stocks fell by 2.8 million barrels, while distillate stockpiles were down by 510,000 barrels, versus expectations for a 2.1-million-barrel drop.

Meanwhile, fresh economic data out of the United States showed that January’s personal consumption expenditures index was in line with expectations. The report supported oil prices as the figures keep the possibility of a June interest rate cut on the table.

On the other hand, data from China, the world’s largest oil consumer, capped positive momentum in the oil market as the country’s manufacturing activity continued to contract for the fifth consecutive month. A weak release added to demand concerns among oil traders.