Nick Goold
Gold
Gold witnessed a remarkable surge during the previous week, driven by mounting geopolitical tensions amid the ongoing conflict between Israel and Palestine. This surge in uncertainty prompted investors to seek refuge in safe-haven assets, with Gold being a prime choice. A noteworthy development was the decline in long-term US interest rates, which had previously exerted downward pressure on Gold prices. This shift in the interest rate landscape and dovish remarks from Philadelphia Fed President Patrick Harker provided an added boost to Gold's upward trajectory.
Friday's market action was particularly noteworthy, characterized by an explosive surge in Gold prices. This rally was underpinned by lower-than-expected US Consumer Sentiment data and speculative buying as market participants positioned themselves cautiously ahead of the weekend. However, it's important to exercise prudence as Friday's rapid price increase could lead to a retracement at the outset of the new week. Nevertheless, traders adopting short positions should do so cautiously, considering that the escalating conflict in the Middle East may continue to support Gold prices, which remain below their July levels.
Short-term traders are poised to find both buying and selling opportunities as volatility will remain extremely high in the upcoming week. Medium-term traders, on the other hand, may contemplate selling positions if Gold prices persistently stay below the critical $1,946 resistance level. However, it's essential to bear in mind that the extent of any price decline may be limited should the Middle East conflict persist, given the ongoing geopolitical uncertainties at play.
Resistance: 1946, 1984, 2000
Support: 1900, 1884, 1836, 1809, 1800
WTI
WTI crude oil experienced a dynamic and eventful week, marked by significant developments reverberating throughout the global energy market. One notable development occurred Thursday when the United States escalated its stance on Russian crude exports by imposing tighter sanctions. These measures targeted two shipping companies allegedly violating the G7's oil price cap. Concurrently, the escalation of the Israel-Hamas conflict towards the end of the week introduced an additional layer of anxiety for market participants, who were increasingly worried about the potential ramifications on regional oil production. These geopolitical factors contributed to heightened volatility and uncertainty in the oil market.
Despite the earlier turbulence, the week concluded on a highly positive note for WTI crude oil, with the commodity recording its most substantial one-day gain since April. However, it is important to interpret this surge cautiously, as Friday's robust closing performance could be attributed, in part, to position adjustments made ahead of the weekend.
Given the current environment, predicting the next significant price move in oil is challenging. Consequently, traders will find many short-term trading opportunities. In the week ahead, looking for range trading opportunities when the market exhibits overextension to the upside or downside looks to be the best strategy.
Resistance: 89.00, 94.00, 100.00
Support: 85.00, 82.50, 80.00, 78.50, 75.00, 70.00
