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
More View more
Real Time News
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZBx7g https://t.co/h4IobFxst9
  • Earnings will remain a key theme ahead with AMZN and AAPL due to follow GOOG's and MSFT's failure to push a Nasdaq 100 to record highs while the ECB will follow in the BOC's and Brazil hawkish policy mix. That said, I'm watching the Dollar most closely: https://www.dailyfx.com/forex/video/daily_news_report/2021/10/28/Nasdaq-100-Fails-to-Break-Despite-Google-EURUSD-Will-Struggle-for-Break-Despite-Heavy-Event-Risk.html https://t.co/dyXrxok07K
  • 🇯🇵 BoJ Interest Rate Decision Actual: -0.1% Expected: -0.1% Previous: -0.1% https://www.dailyfx.com/economic-calendar#2021-10-28
  • Heads Up:🇯🇵 BoJ Quarterly Outlook Report due at 03:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2021-10-28
  • Heads Up:🇯🇵 BoJ Interest Rate Decision due at 03:00 GMT (15min) Expected: -0.1% Previous: -0.1% https://www.dailyfx.com/economic-calendar#2021-10-28
  • US crude is down another 2.2 percent in early Asia trade. We are on pace to break below the 20-day moving average (and 20-day support) for the first time in 43 trading days. There those the default risk appetite run... https://t.co/f4Bg8t1e0i
  • Futures have their own set of characteristics and appeal to different types of traders and investors for a variety of reasons. Get your free trading guide and learn to trade the markets with futures here. Download your guide today!https://t.co/72oKM0kLHL https://t.co/DQO98JyTto
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Gold: 0.20% Silver: 0.08% Oil - US Crude: -2.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/dbzLm7PqBe
  • The 2022 forecast for Fed Fund futures has surged to its highest on record (fully pricing in two 25bp rate hikes) and you can see it in the 2-10 Treasury yield spread this past session: https://t.co/5qMg2X8MX1
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.20% 🇨🇭CHF: 0.06% 🇪🇺EUR: 0.05% 🇬🇧GBP: -0.02% 🇨🇦CAD: -0.06% 🇦🇺AUD: -0.19% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/Y9B3C6uhBW
Crude Oil Prices May Fall as Market Mood Turns Sour

Crude Oil Prices May Fall as Market Mood Turns Sour

Ilya Spivak, Head Strategist, APAC

CRUDE OIL & GOLD TALKING POINTS:

  • Crude oil prices may drop as risk appetite wanes across global markets
  • Technical positioning suggests the WTI contract might be forming a top
  • Gold prices capitalize as bond yields dive while the US Dollar struggles

Crude oil prices shot higher – briefly touching a three-month high – but momentum quickly fizzled, pushing the WTI benchmark back down to finish Tuesday’s session with a loss. A backdrop of weakening risk appetite seemed to account for the selloff.

All the tell-tale signs of risk aversion seemed present: bond yields drifted lower, the sentiment-geared Australian and New Zealand Dollar trimmed intraday gains while the anti-risk Japanese Yen tracked higher, and Wall Street backed away from session highs.

Interestingly, the US Dollar seemed unable to capitalize. It usually finds support from haven demand when markets turn defensive. A soggy set of US PMI figures may have played a part, with the manufacturing sector unexpectedly shrinking for a fourth month while services activity contracted faster than projected.

Lower bond yields against the risk-off backdrop coupled with an anchored Greenback allowed gold prices free rein to push upward. The yellow metal scored a third consecutive day of gains, advancing to the highest level in almost eight years.

The market mood seems to have soured further despite a modestly upbeat tone in Asia-Pacific trade. Bellwether S&P 500 futures are pointing sharply lower, suggesting crude oil may fall alongside shares as the trading wears on. Gold’s ability to capitalize will probably depend on how pressured USD remains.

CRUDE OIL TECHNICAL ANALYSIS

Crude oil prices continue to inch closer to resistance in the 42.40-43.88 area, a barrier anchored by former support at the December 2018 bottom. Negative RSI divergence warns that upside momentum is ebbing however, which may set the stage for a reversal lower. A daily close below support at 34.78 may the 27.40-29.11 inflection zone. Alternatively, claiming a foothold above resistance likely targets $50/bbl next.

Crude Oil Prices May Fall as Market Mood Turns Sour

Crude oil price chart created using TradingView

GOLD TECHNICAL ANALYSIS

Gold prices managed to break resistance marked by the May 18 highat 1765.30, which appears to set the stage for a test of the 38.2% Fibonacci expansion at 1790.78. Extending the rally beyond that puts the 50% level at 1827.82 into focus. Alternatively, slipping back below 1765.30 – now recast as support – probably brings the range floor in the 1679.81-93.92 area back into the spotlight.

Crude Oil Prices May Fall as Market Mood Turns Sour

Gold price chart created using TradingView

COMMODITY TRADING RESOURCES

--- Written by Ilya Spivak, Head APAC Strategist for DailyFX

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

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

DISCLOSURES