Crude oil products and gold logs:
- Crude oil prices taller higher to challenge two-month trend resistance
- Gold price tagging after near-term support
- Fed Chair Powell testimony, FOMC minutes may damage commodities
Crude oil prices reflected one modest recovery in risk willingness, pacing a rise in the bellwether S & P 500 index. Gold prices lined up in tandem. These features probably reflect pre-positioning before major event risks ahead as a much-anticipated market console congressional testimony from Fed Chair Powell as well as the release of minutes from the June FOMC policy meeting .
The main issue in play is the returnable difference between Fed's own prospects for future monetary policy and the financial markets. June's forecast update provided a 25bps cut between now and the end of 2020. Investors are by far the stupid mode, seeing at least two and possibly three cuts (for a 50-75bps aggregate relief) before the end of this year.
RUDE OIL AND GOLD PRICE MUST BE JOINED ON THE POWELL TESTIMONIA, FOMC MINUTES
Markets have gone ahead of the Fed in a tough policy pivot since the end of 201
On the other hand, the rhetoric that gives a return to it would be excessive in the market view, could force traders to represent the expectations of a more modest attitude. Not surprisingly, Greenback probably seems to find support in this scenario as well. It seems to indicate that stasis may be the best scenario for the oil price, while gold is mostly exposed to sales pressure.
Get the latest crude oil prices and gold forecasts to see what will drive the prices in the Third Quarter!
GOLD TECHNICAL ANALYSIS
The gold prices are slimming in digestive mode after edging under the trendline support that controls the movement higher since the end of May. Sellers face a dense support block that passes through 1346.75 from here. Critical Resistance Remains at 1433.85, characterized by August 2013 high and earlier appearing support from December 2016.
CRUDE OIL TECHNICAL ANALYSIS
Crude oil prices lined up to test resistance capping gains since late April, now at 59.43. A daily close over it is quickly followed by previous support in the area of 60.39-95. Alternatively, a return lower that takes prices under the support of 54.55 goals 50.31-51.33 zone.
— Posted by Ilya Spivak, Currency Strategist for DailyFX.com