Gold, Crude Oil Prices Look to US Election Outcome for Direction
- Gold prices drop after FBI clears Clinton in email fiasco – again
- Crude oil prices snap six-day losing streak, hint at bounce ahead
- Significant trend development unlikely before US election results
Commodities prices are in marking time as traders await the outcome of the US presidential election before committing to a firm bias. Crude oil prices rose while gold prices fell amid a broad-based swell in risk appetite in yesterday’s session after the FBI affirmed its July conclusion that Hillary Clinton did not commit a crime in her handling of emails while serving as Secretary of State.
Significant directional progress seems unlikely until today’s vote is tallied and the results are in. Recent price action suggests that a victory for Secretary Clinton is likely to seen as an affirmation of the status quo and boost sentiment, sending the WTI benchmark upward alongside equities while gold declines. Alternatively, a win for Donald Trump threatens to trigger risk aversion and yield the opposite dynamic.
See what crude oil and gold price patterns hint about on-coming moves with the GSI indicator!
GOLD TECHNICAL ANALYSIS – Gold prices were rejected downward following a test of the $1300/oz figure. From here, a daily close below the intersection of trend line support and the 23.6% Fibonacci retracement at 1272.84 exposes the 14.6% level at 1260.80. Alternatively, a move back above the 38.2% Fib at 1292.37 targets the 1303.62-08.15 area (May 2 high, 50% retracement).
CRUDE OIL TECHNICAL ANALYSIS – Crude oil prices put in a Bullish Engulfing candlestick pattern, hinting a bounce may be ahead. A daily close above the 50% Fibonacci retracement at 45.54 exposes the 46.51-47.04 area (trend line support-turned-resistance, 38.2% level). Alternatively, a move below the 61.8% Fib at 44.04 targets the 76.4 retracement at 42.18.
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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