News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Wall Street
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
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/9po5Lg4vnR
  • The Japanese Yen is eyeing the upcoming Bank of Japan rate decision and CPI figures, but JPY crosses will likely remain dependent on broader market sentiment. Get your weekly $JPY forecast from @FxWestwater here: https://t.co/x9rbQpPfWe https://t.co/2x1R5XTVea
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here: https://t.co/yOEvLjKnct https://t.co/uCaWQiu4Ly
  • Crude and Brent oil are on track to extend higher as Gulf Coast supply disruptions and a positive OPEC report bolster sentiment. Uranium is on a massive surge, aided by the famous Wall Street Bets group. Get your market update from @FxWestwater here:https://t.co/XrpV0jcy8e https://t.co/g2To3LmUah
  • RT @michaeljburry: Read thread.
  • The Australian Dollar has retraced from August lows when looking at AUD/JPY and AUD/CAD. However, the AUD/NZD downtrend is intact, will a reversal there appear as well? Find out: https://t.co/8LmgqLLGJO https://t.co/AueigVsuk4
  • The S&P 500, Dow Jones and DAX 30 could be at risk of falling as retail traders continue increasing their upside exposure in these indices. What are the key technical levels to watch for? Find out from @ddubrovskyFX here:https://t.co/OJByiwIppr https://t.co/P1iOONG90N
  • The US Dollar continues to hold its ground against most ASEAN currencies as recent downtrends lose momentum. What is the road ahead for USD/SGD, USD/THB, USD/PHP and USD/IDR? Find out from @ddubrovskyFX here:https://t.co/UcleaZEAaW https://t.co/62bGLvt8fE
  • The Canadian Dollar has been caught in broad ranges against the Euro and the US Dollar, but can the upside bias in USD/CAD and EUR/CAD prolong? Find out here:https://t.co/8DubboXsjv https://t.co/A0sIYo2iP1
  • Want to hear my thoughts on the US Dollar? Check out yesterday's recording with #AuzBiz hosted by @KaraOrdway on 'The Trade' We discussed a #USD index, Treasury yields, $USDJPY, $AUDUSD and $NZDUSD https://t.co/yxwquL1btp https://t.co/RtWjlN6kpv
Crude Oil May Rise as Gold Falls on 4Q US GDP Report

Crude Oil May Rise as Gold Falls on 4Q US GDP Report

David de Ferranti, Ilya Spivak,

Talking Points

  • 4Q US GDP Data in Focus, Upside Risks Eyed
  • Crude Oil Testing Critical Resistance at $97.70
  • Gold Yet to Play Out Bearish Technical Setup

Gold and silver are correcting downwards in overnight trade having advanced following the Federal Reserve’s decision to reduce their asset purchase program by a further $10 billion. The stimulus reduction was widely anticipated by economists and the policy statement produced no changes in the forward guidance framework. In this context, the move higher in the precious metals space may have reflected relief at the passing of key event risk without an unforeseen hawkish policy shift.

Crude oil strengthened after the weekly set of DOE inventory figures showed distillate stockpiles fell by the most in 10 weeks. Newswires attributed the falling inventory levels to a rise in heating fuel demand due to ongoing cold weather conditions. The intraday uptrend largely overlooked the FOMC meeting: the WTI contract briefly dipped downward as the Fed reduced stimulus further but quickly resumed its prior advance as the outcome proved to fall in line with expectations.

Tomorrow’s fourth-quarter US GDP figures will likely provide some additional guidance for the US Dollar and thus have implications for the commodities space. US economic news-flow has gradually deteriorated relative to expectations in recent weeks (according to data from Citigroup), with notable misses on December’s Nonfarm Payrolls and Durable Goods Orders reports A similar pattern is expected on the GDP front: the year-on-year growth rate is seen slowing to 3.2 percent from 4.1 percent recorded in the third quarter.

A soft patch in the US recovery clearly didn’t prompt the Fed to slow the pace of QE reduction, so a print in line with expectations is unlikely to offer fresh fodder for US Dollar sellers. On the other hand, an upside surprise would mark a departure from recent dynamics and has scope to push the greenback higher. Such a scenario would bode ill for precious metals amid ebbing anti-fiat demand. Meanwhile, crude oil may likewise rise if stronger-than-expected US performance boosts risk appetite.

CRUDE OIL TECHNICAL ANALYSIS Oil is testing critical resistance at $97.70 following a bounce off support at the 38.2% Fib retracement level at $95.29. The commodity has continued to put in a series of higher highs and higher lows over the past couple of weeks, however, a break below the descending trend line from Sep 2013 would be required before offering a bullish bias.

Crude_Oil_May_Rise_as_Gold_Falls_on_4Q_US_GDP_Report_body_Picture_4.png, Crude Oil May Rise as Gold Falls on 4Q US GDP Report

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS The Dark Cloud Cover candlestick formation which was warning of a potential reversal for gold has found little confirmation. Buying support for the precious metal has emerged once again at $1,256 which coincided with a test of the Trend line from the Jan 2013. A break above resistance at $1,270 would be required before offering a bullish bias on the commodity.

Crude_Oil_May_Rise_as_Gold_Falls_on_4Q_US_GDP_Report_body_Picture_3.png, Crude Oil May Rise as Gold Falls on 4Q US GDP Report

Daily Chart - Created Using FXCM Marketscope 2.0

SILVER TECHNICAL ANALYSIS Silver is testing the bottom of the ascending triangle formation on the daily which comes as sellers have kept prices contained within the descending channel. A break to the downside may open up the psychologically significant $19 handle, which offered buying support in December 2013.

Crude_Oil_May_Rise_as_Gold_Falls_on_4Q_US_GDP_Report_body_Picture_2.png, Crude Oil May Rise as Gold Falls on 4Q US GDP Report

Daily Chart - Created Using FXCM Marketscope 2.0

COPPER TECHNICAL ANALYSIS The technicals are continuing to suggest weakness for copper in the near-term. The Head and Shoulders pattern on the daily has offered a target of $3.15, with more immediate support at $3.18. The bearish bias is aided by the descending trend channel and prices tracking below the 20SMA.

Crude_Oil_May_Rise_as_Gold_Falls_on_4Q_US_GDP_Report_body_Picture_1.png, Crude Oil May Rise as Gold Falls on 4Q US GDP Report

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by David de Ferranti, Market Analyst, FXCM Australia

To receive David’sanalysis directly via email, please sign up here

Contact and follow David on Twitter: @DaviddeFe

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

DISCLOSURES