We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
GBP/USD
Bearish
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Bearish
Bitcoin
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Heads Up:🇯🇵 JPY Loans & Discounts Corp (YoY) (SEP) due at 23:50 GMT (15min), Actual: N/A Expected: N/A Previous: 2.44% https://www.dailyfx.com/economic-calendar#2019-11-12
  • 🇦🇺 AUD Westpac Consumer Confidence (NOV), Actual: 4.5% Expected: N/A Previous: -5.5% https://www.dailyfx.com/economic-calendar#2019-11-12
  • RT @politico: Congress has pegged Dec. 20 as the next deadline for government funding after the current stopgap expires next week https://…
  • @ZabelinDimitri Not to mention that negative RSI divergence and an Evening Star candlestick pattern on the 4-hour chart in #SP500 futures are looking very ominous https://t.co/cAL2Gz2stJ
  • (Asia Pacific AM Briefing) Yen May Rise, USD/JPY Reversal Ahead After Trump Trade Talk? $USDJPY #Yen #tradewars - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2019/11/12/Yen-May-Fall-USDJPY-Reversal-Ahead-After-Trump-Trade-Talk.html https://t.co/5nQ73RKQ6S
  • Heads Up:🇦🇺 AUD Westpac Consumer Confidence (NOV) due at 23:30 GMT (15min), Actual: N/A Expected: N/A Previous: -5.5% https://www.dailyfx.com/economic-calendar#2019-11-12
  • $USDJPY Daily Pivot Points: S3: 108.59 S2: 108.81 S1: 108.93 R1: 109.14 R2: 109.23 R3: 109.45 https://www.dailyfx.com/pivot-points?ref=SubNav?utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • Fed's Kashkari says there's a lot of consensus at the #Fed that monetary policy is modestly accomodative
  • RT @globaltimesnews: #Apple must remove such films and songs as soon as possible, unless it does not want to do business in #China anymore:…
  • The #gold price plunge is testing the first major hurdle and the immediate focus is on key support at 1451/61 with the short-bias vulnerable while above this threshold. Get your $gld technical analysis from @MBForex here: https://t.co/cBT4lG6pRq $XAUUSD https://t.co/e1gBJAvOp5
Crude Oil, Gold to Recover as Soft US Jobs Report Stokes Dovish Fed Bets

Crude Oil, Gold to Recover as Soft US Jobs Report Stokes Dovish Fed Bets

2011-05-06 11:20:00
Ilya Spivak, Sr. Currency Strategist
Share:

Commodities – Energy

Oil to Follow Stocks Correction Higher

WTI Crude Oil (NY Close): $99.80 // -9.44 // -8.64%

Crude is pushing sharply lower, with prices poised to take out support at the midline of a rising channel that has guided them higher since February 2009. Initial support lines up at $92.98, followed by the channel bottom now at $88.12. Taken together, this is a formidable barrier and a bounce higher seems likely before it is taken out in earnest. Initial resistance lines up at the $100/barrel figure.

Risk sentiment remains in focus, with the WTI contract moving in tandem with the MSCI World Stock Index. This puts the onus on April’s US employment figures. Expectations call for the world’s top economy to add 185,000 jobs in April – marking the smallest increase in three months – while the Unemployment Rate holds steady at 8.8 percent.

Traders have been selling risky assets and buying the US Dollar this week, apparently look ahead to rising US yields after the Federal Reserve firmly pledged to end QE2 in June at last week’s FOMC meeting. It seems reasonable that a soft employment figure may be just the catalyst to engineer some profit-taking on risk-averse positions, with shares as well as risk-correlated assets including crude recovering while the greenback retraces some of its advance.

Crude_Oil_Gold_to_Recover_as_Soft_US_Jobs_Report_Stokes_Dovish_Fed_Bets_body_Picture_5.png, Crude Oil, Gold to Recover as Soft US Jobs Report Stokes Dovish Fed Bets

Commodities – Metals

Gold, Silver to Rebound on Soft NFP Result

Spot Gold (NY Close): $1474.30 // -42.02 // -2.77%

Prices followed up a bearish Dark Cloud Cover candlestick pattern with a drop to support at $1474.25, the 38.2% Fibonacci retracement of the rally from January’s swing low, a barrier reinforced by a rising trend line set from the same point. A corrective bounce from here sees initial resistance at $1513.54, the 23.6% Fib, while a break lower exposes the 50% level at $1442.50.

Inflation expectations remain in focus, with prices firmly anchored to one-year breakeven rates (the spread between yields on regular and inflation-linked Treasury bonds of equal maturities). Needless to say this points the spotlight on April’s US jobs report. Perversely, a relatively soft outcome may actually see price growth bets move higher, taking the yellow metal along for the ride, as traders interpret lackluster labor market growth as a sign that the Federal Reserve may slow to removing stimulus measures beyond allowing QE2 to expire in June as promised last week.

Crude_Oil_Gold_to_Recover_as_Soft_US_Jobs_Report_Stokes_Dovish_Fed_Bets_body_Picture_3.png, Crude Oil, Gold to Recover as Soft US Jobs Report Stokes Dovish Fed Bets

Spot Silver (NY Close): $34.70 // -4.64 // -11.80%

Prices have taken out support $37.39, the 76.4% Fibonacci retracement of the rally from mid-March, with sellers now testing support near the 3/15 low at $33.56. A break lower beyond this barrier exposes $31.24, the January 3 high. The 76.4% level has been recast as near-term resistance.

As with gold, a strong correlation with the one-year breakeven rate hints that a soft US jobs report may help to engineer a bounce as traders temper hawkish Federal Reserve expectations. The gold/silver ratio has soared to the highest in over three months, suggesting the cheaper metal will continue to underperform its more expensive counterpart.

Crude_Oil_Gold_to_Recover_as_Soft_US_Jobs_Report_Stokes_Dovish_Fed_Bets_body_Picture_4.png, Crude Oil, Gold to Recover as Soft US Jobs Report Stokes Dovish Fed Bets

For real time news and analysis, please visit http://www.dailyfx.com/real_time_news

To receive future articles by email, please contact Ilya at ispivak@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.