Analytics

Gold prices retain a modest bullish bias, looking resilient after an ascent witnessed on Tuesday. The bullion seems to have partially shrugged off the recent bearish pressure, with $2,300 representing the intermediate significant support on the way to local lows.

Now, the XAUUSD pair needs some momentum to make a more decisive bounce, with prices struggling to attract more decisive demand so far today. The downside potential looks limited at this stage, however, as the dollar looks steady these days.

The US currency finished unchanged overnight, staying unbiased today, with volatility ebbing these days. Late last week, the greenback briefly rallied to early-May highs in the 105.80 area due to a relatively hawkish tone from the Fed before retreating partially amid some profit-taking.

Indecisive dollar helps

This week, the dollar has settled above the 105.00 figure, struggling for direction after a slide witnessed at the start of the week. During the previous session, the dollar extended losses towards the 105.13 zone before bouncing marginally. The USD index turned slightly bullish in recent trading, but lacks the momentum so far, thus fueling some demand surrounding the yellow metal.

On the weekly timeframes, the technical picture has barely changed, with wider picture remaining upbeat after reaching fresh all-time highs. On the upside, the immediate significant target is now represented by the $2,350 zone, followed by the $2,360 region that capped gains last week. Downside risks look limited while above the $2,300 figure.

In the medium term, gold will continue to take clues from speculations surrounding the Fed policy outlook, with rate cut expectations keeping the bullion afloat. Of note, slowing US retail sales bolstered rate cut chances, adding to upbeat tone surrounding gold.

Bullish bias has been dominating the oil market for more than a week already, albeit the momentum has slowed these days. Brent crude saw this week’s highs in the $83.35 area before retreating partially. On Friday, oil futures struggle for direction, holding slightly above the $82 handle.

In part, oil prices struggle to see a mode decisive ascent due to a stronger dollar. The USD index extended the ascent to the 105.55 zone for the first time in over a month, holding onto the upper end of the extended trading range ahead of the weekend. The greenback remains bullish due to a relatively hawkish tone from the Fed this week, shrugging off weaker-than-expected inflation numbers.

Of note, fresh data showed that US producer price inflation marked the largest monthly decrease since October last month, dropping 0.2% against estimates for an increase of 0.1%. A separate report showed that weekly jobless claims rose to its highest level in 10 months last week, with 242,000 people applying for unemployment. Those numbers make it more likely the Fed could start cutting interest rates in the coming months, which is positive for risky assets including oil.

Brent stays afloat

In industry news, the U.S. Energy Information Administration reported that commercial crude oil inventories increased by 3.7 million barrels last week. In gasoline, the authority reported an inventory build of 2.6 million barrels, while distillate stockpiles saw an increase of 900,000 barrels for the week to June 7. Despite bearish figures, Brent crude managed to stay afloat, in part due to a relatively upbeat risk sentiment across financial markets.

Technically, oil prices could see fresh bullish attempts in the near term, with downside risks limited while above the $80 psychological level that represents the immediate significant support at this stage. On the upside, a decisive break above $83 would pave the way to more bullish bets in the near term.

The price of bitcoin has steadied on Wednesday after a solid slide witnessed during the previous session. The largest cryptocurrency by market capitalization peaked just below the $72,000 figure last week and has been struggling since then as traders continue to take profit after a spike. Overnight, the BTCUSD pair saw three-week lows around $66,200 before bouncing back above the $67,000 figure that now represents the immediate support.

The digital coin struggles these days as risk appetite has been constrained by anticipation of a Federal Reserve meeting and key inflation data. Rate jitters distress both financial and cryptocurrency markets, with high rates diminishing the appeal of risk-driven assets like crypto.

The US central bank is widely expected to keep rates unchanged later today. At the same time, the Fed could present a more hawkish outlook, especially amid still elevated inflation. Traders have scaled back their bets on a rate cut in September, which added to dollar’s bullishness and weighted on digital assets.

Upward trend persists

As bitcoin failed to reach the $72,000 barrier earlier in the month, the near-term outlook looks mixed-to-bearish so far at this stage. Of note, the pair was rejected from this level for the fourth time already. So the market may need a significant bullish driver to challenge and break above the barrier eventually.

In a wider picture, however, the coin is poised to continue its upward trend. After posting all-time highs around $73,600 in March, the BTCUSD pair has been holding mostly above the $60,000 figure last seen in late-April. In the near term, a failure to hold above $66,000 may add to the downside momentum surrounding bitcoin.

At the end of a relatively positive week, gold prices fell sharply, retracing from two-week highs on Friday as traders opted to take profit in anticipation of the release of a closely-watched monthly employment report from the United States.

After a brief rally above the $2,400 figure for the first time since May 22, the XAUUSD pair dipped to the $2,355 zone that has been acting as support so far. Despite the sell-off, the precious metal remains slightly positive on the weekly timeframes so far, with this week’s lows arriving in the $2,335 area.

The sell-off took place during the European hours as the US dollar erased intraday losses to turn unchanged. Still, the greenback remains bearish, clinging to mid-May lows around the 104.00 figure that has been preventing the USD from a deeper retreat this week.

Bullishness persists

In the near term, gold prices could resume the ascent if the dollar comes under renewed selling pressure. Such a scenario could be seen later in the day if the upcoming US employment and wages report disappoints.

In a wider picture, the safe-haven yellow metal could see fresh all-time highs as global central banks proceed to cutting rates. By the way, the Bank of Canada and the ECB both launched monetary easing this week, thus adding to positive tone surrounding the non-yielding metal.

Technically, the XAUUSD pair remains bullish, with downside risks limited while above the $2,300 zone last seen more than one-month ago. The key support area now arrives around $2,330, while on the upside, a decisive recovery above $2,380 would pave the way back to the $2,400 key barrier on the way to all-time tops registered last month around $2,465.

Oil prices turned directionless on Wednesday after yesterday’s modest bounce. Earlier, Brent crude witnessed a five-day losing streak. In late May, a failure to overcome the $85 barrier attracted strong selling interest that pushed the futures below $77 during the previous session.

The latest decline intensified earlier in the week as industry data pointed to an unexpected buildup in U.S. crude inventories. The American Petroleum Institute reported that U.S. crude inventories rose by around 4 million barrels last week, defying expectations for a nearly 2-million-barrel draw. Gasoline and distillate stockpiles also registered builds. As such, the report added to concerns over slowing oil demand.

Earlier, Brent was pressured by the outcome of the OPEC+ meeting as the alliance signaled plans to begin scaling back some production cuts later this year. In particular, OPEC+ members said they would begin phasing out production cuts over the course of 12 months starting in October. Under the plan, more than 500,000 bpd would return to the market by December.

Weak data from major economies added to worries in the oil market. Top oil importer China reported mixed purchasing managers’ index numbers for May, while the United States revealed dismal figures on jobs market, the manufacturing PMI, and downwardly revised GDP.

Oil on the defensive

Against this backdrop, oil could stay on the defensive in the near term, struggling to attract sustained demand amid demand-related risks.

Technically, Brent crude needs to regain the $78 figure first in order to retarget the $80 mark. The short-term outlook for the futures remains bearish while below the psychological level. On the downside, a failure to hold above $77 would push the prices to four-month lows seen around $76.75 on Tuesday. A break below the $76.60 support zone would further deteriorate the technical picture.

Bitcoin looks relatively steady these days, albeit a bearish bias dominates the cryptocurrency market at this stage. The BTCUSD pair peaked above $70,000 at the start of the week before retreating. The coin has been trading mostly lower since then. On Friday, the digital currency has settled around the $68,000 figure, holding in negative territory after yesterday’s gains.

During the previous session, the largest cryptocurrency by market capitalization was buoyed by fresh news out of the United States. America’s economy didn’t expand as much as anticipated in the first quarter, thus pressuring the dollar and pushing cryptocurrencies higher. US GDP growth in the first three months on an annualized pace came in at 1.3%, missing the forecast for 1.6%.

US inflation in focus

In general, however, crypto demand remains muted as caution over U.S inflation and interest rates keeps investors largely averse towards risk-driven assets. Now, investors look ahead to a key US inflation report. The PCE Index, the US Federal Reserve’s chosen inflation gauge, is projected to remain at 2.7%, while the more significant core figure is estimated to remain at 2.8%. Should the figures come in lower than expected, bitcoin may bounce due to a potential dollar weakness.

In the near term, the BTCUSD pair is likely to continue its consolidation around $68,000 before deciding on further direction. On the upside, the key resistance is represented by the $70,000 psychological level, followed by this week’s highs in the $70,700 area. On the downside, the immediate support arrives at $67,200 and the $66,500 region. In a wider picture, bitcoin remains within a broader uptrend, holding close to all-time highs registered above $73,000 in March.

Gold prices turned back bearish in recent trading after yesterday’s jump that was capped by the $2,365 zone. The bullion failed to shrug off the pressure and retarget the $2,400 region that represents the intermediate barrier on the way to all-time highs seen around $2,455 earlier in the month. Since then, the XAUUSD pair has retreated partially as prices are hesitating to extend the ascent, with the bullion holding below the mentioned historical highs.

The downside potential looks limited at this stage, however. On the weekly timeframes, the technical picture has deteriorated somehow, with wider picture remaining upbeat after reaching fresh all-time highs. On the upside, the immediate significant target is now represented by the $2,400 zone, followed by the mentioned record tops. Downside risks look limited while above the $2,300 region. Should dollar demand intensify in the near term, the bullion may see a deeper retreat.

Stronger dollar caps gains

The US dollar finished higher on Tuesday after a brief dip towards mid-May lows around 104.30 earlier in the day as traders opted to buy on a dip. On Wednesday, the greenback retains bullish bias, but still lacks the upside momentum to retarget the 105.00 psychological level that capped gains last week. As such, the USD index struggles to attract mode decisive demand, oscillating around the 104.70 figure in anticipation of fresh drivers.

Should the greenback refrain from any major rally in the days to come, the XAUUSD pair may stay afloat and settle above the $2,350 zone, with focus remaining on the $2,400 handle. On the downside, the $2,325 region represents the nearest support at this stage. Ahead of the weekend, the bullion may come under more intense selling pressure if the dollar cheers the US PCE report.

Oil prices continued to lose ground this week, extending the pullback from multi-month highs seen above $92 in April. Since then, Brent crude has given up more than $10, with the $80 psychological level coming into the market focus for the first time since February. Oil futures were headed for a weekly decline of more than 3%.

Oil market lacks bullishness as fears of a wider war in the Middle East have eased. Also, traders remain cautious that higher-for-longer interest rates could slow the US economy and weigh on oil demand. On the other hand, the weakness in oil prices increases the likelihood that OPEC+ members roll over their additional supply cuts into the second half of the year.

In industry news, US crude inventories rose by 1.8 million barrels in the week ending May 17, the Energy Information Administration this week. As such, inventories rose to the highest level since early November, adding to worries about demand ahead of the summer driving season. On the positive side, gasoline stocks fell by 945,000 barrels, more than forecasts for a 729,000-barrel draw.

Bullish dollar caps gains

Meanwhile, a stronger dollar added to the selling pressure surrounding Brent. The USD index climbed back to the 105.00 area after an earlier slide to local lows around the 104.00 figure. The buying pressure intensified after fresh data showed US business activity grew at its fastest pace in more than two years in May, suggesting the Fed may delay interest rate cuts amid a resilient economy.

As long as interest-rate worries persist, Brent crude will continue to struggle along with other risky assets. In the near term, oil futures could derail the $81 figure should risk aversion persist. In case of a bounce, the price will retarget the $82.30 intermediate barrier on the way towards the $83 mark.

The price of bitcoin peaked around the $72,000 figure earlier in the week before retreating partially. The digital coin has settled around the $70,000 psychological level on Wednesday, struggling for direction after some profit-taking following a recent rally on optimism over a spot Ether ETF.

Reports this week suggested some progress towards the approval of spot ETFs by the Securities and Exchange Commission. The regulator is set to make a decision on potentially approving the ETFs later this week. Ahead of a crucial decision, the SEC had asked exchanges to fine-tune their filings for spot Ether ETFs.

Against this backdrop, bitcoin rallied along with Ether at the start of the week, but failed to challenge fresh all-time highs as warnings on stubbornly high U.S. inflation and high-for-longer interest rates kept market players cautious towards risky assets in general and crypto markets in particular.

SEC and FOMC in focus

In anticipation of the SEC decision, the BTCUSD pair holds relatively steady. But the SEC could still deny the applications. If so, cryptos could see solid losses amid disappointment.

Also, Bitcoin struggles to hold gains in anticipation of more Fed cues. In particular, investors await the minutes of the Federal Reserve’s meeting. Should the upcoming Fed minutes deliver a hawkish tone, bitcoin may see a more intense selling pressure. Earlier in the week, several Fed officials reinforced the stance that it would be best for the central bank to be patient before starting to cut interest rates.

In the near term, bitcoin needs to stay around the $70,000 figure in order to avoid a deeper retreat. On the downside, the nearest support now arrives around $69,200, followed by the $67,800 region. Should demand reemerge, the coin will retarget the $72,000 barrier.

Gold looks relatively upbeat on Friday after a modest retreat from one-month highs seen during the previous session. The precious metal extended gains to the $2,400 zone that capped the bullish momentum and triggered some retreat. However, the bullion remains resilient.

Risk sentiment has deteriorated across the financial markets overnight after Fed officials suggested that rates may need to stay higher for longer even as inflation shows signs of easing. Earlier, gold bulls were inspired as inflation cooled, reviving hopes for an earlier rate cut by the Federal Reserve.

The dollar itself keeps rebounding on Friday, extending yesterday’s gains after a major sell-off witnessed on Wednesday. The USD index derived support from the 104.00 figure to bounce back above the 104.50 zone. In recent trading, the greenback extended its recovery to the 104.75 region, targeting the 105.00 figure as risk sentiment continues to deteriorate, fueling demand for the safe-haven dollar ahead of another series of comments from Fed policymakers.

Should central bank officials strike a hawkish tone again, the XAUUSD pair may come under some pressure along with stocks, while the greenback and Treasury yields could jump.

Outlook stays positive

In a wider picture, gold looks set for a second consecutive weekly gain, with investors focusing on expectations that the Federal Reserve could cut interest rates this year. In this context, the metal will continue to monitor incoming US economic data that could affect Fed rate cut expectations further. Also, the bullion continues to derive support from still heightened geopolitical tensions.

As such, should positive momentum continue to persist in the days and weeks to come, the next target for gold bulls will be its record high. But first, the price will needs to overcome the $2,400 psychological level.