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Talking Points:

Commodities launched higher as the US Dollar slumped after January’s US CPI data crossed the wires. Crude oil prices are denominated in terms of the greenback on global markets, so the currency’s slump offered de-facto support. A pickup in risk appetite probably helped a well, with the WTI benchmark rising alongside stocks. Gold rose as the move stoked demand for anti-fiat alternatives.

Looking ahead, US PPI data amounts to the only bit of noteworthy scheduled event risk on the docket. The core wholesale inflation rate is expected to tick down from 2.3 to 2.1 percent. Anything short of a dramatic upside surprise echoing last month’ surge in wage growth seems likely to feed continuation of the current narrative, though momentum may slow after yesterday’s explosive moves.

Find out here what retail traders’ gold buy and sell decisions hint about the price trend!

GOLD TECHNICAL ANALYSIS

Gold prices surged higher to challenge the 38.2% Fibonacci expansion at 1356.23. A daily close above this barrier paves the way for a test of the 1366.06-71.50 zone (January 25 high, 50% level). The first significant downside barrier remains in the 1312.36-16.50 area (38.2% Fib retracement, support shelf).

Crude Oil, Gold Prices Buoyed as US Dollar Sinks After CPI Data

CRUDE OIL TECHNICAL ANALYSIS

Crude oil prices are attempting to mount a recovery. A daily close above the 23.6% Fibonacci retracement at 60.84 opens the door for a retest of the 14.6% level at 63.05. Alternatively, a turn lower that breaches the 38.2% Fib at 57.25 targets the 50% retracement at 54.36.

Crude Oil, Gold Prices Buoyed as US Dollar Sinks After CPI Data

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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