In its latest short term energy outlook (STEO), which was released recently, the U.S. Energy Information Administration (EIA) lowered its West Texas Intermediate (WTI) spot price forecasts for this year and next year.

According to its December STEO, the EIA now sees the WTI spot price averaging $76.51 per barrel in 2024 and $69.12 per barrel in 2025. The EIA’s previous STEO, which was released in November, projected that the WTI spot price would average $77 per barrel in 2024 and $71.60 per barrel in 2025.

In its latest STEO, the EIA forecast that the WTI spot price will average $70.37 per barrel in the fourth quarter of this year, $69.67 per barrel in the first quarter of next year, $69.83 per barrel in the second quarter, $69.50 per barrel in the third quarter, and $67.50 per barrel in the fourth quarter.

The EIA’s November STEO saw the WTI spot price coming in at $72.32 per barrel in the fourth quarter of 2024, $73.67 per barrel in the first quarter of 2025, $73.17 per barrel in the second quarter, $71.17 per barrel in the third quarter, and $68.52 per barrel in the fourth quarter of 2025.

Both STEOs put the 2023 WTI spot price average at $77.58 per barrel and the third quarter 2024 WTI spot price average at $76.43 per barrel.

A research note sent to Rigzone by the JPM Commodities Research team last Friday showed that J.P. Morgan expects the WTI Crude price to average $76 per barrel in 2024, $69 per barrel in 2025, and $57 per barrel in 2026.

J.P. Morgan sees the WTI Crude price averaging $70 per barrel across the fourth quarter of 2024 and first quarter of 2025, $73 per barrel in the second quarter of 2025, $69 per barrel in the third quarter, and $65 per barrel in the fourth quarter, the report showed. The company expects the commodity to come in at $60 per barrel in the first quarter of 2026, $59 per barrel in the second quarter, $55 per barrel in the third quarter, and $53 per barrel in the fourth quarter, according to the report.

A BMI report sent to Rigzone on the same day by the Fitch Group showed that BMI expects the front month WTI Crude price to average $77 per barrel in 2024 and $73 per barrel in 2025.

Another report sent to Rigzone late Tuesday by Standard Chartered Bank Commodities Research Head Paul Horsnell showed that the bank expects the NYMEX WTI basis nearby future crude oil price to average $89 per barrel in 2025, $92 per barrel in 2026, and $103 per barrel in 2027.

That report revealed that Standard Chartered Bank sees the commodity averaging $86 per barrel in the first quarter of next year, $89 per barrel in the second quarter, $92 per barrel in the third quarter, $90 per barrel in the fourth quarter, and $88 per barrel in the first quarter of 2026.

In a Skandinaviska Enskilda Banken AB (SEB) report sent to Rigzone on Thursday, Ole R. Hvalbye, a commodities analyst at the company, warned that WTI positioning “remains in historically bearish territory”.

“Hedge funds and other institutional investors began rebuilding their positions in Brent last week amid OPEC+ negotiations,” Hvalbye said in that report.

“Fund managers added 26 million barrels to their Brent contracts, bringing their net long positions to 157 million barrels – the highest since July. This uptick signals a cautiously optimistic outlook, driven by OPEC+ efforts to manage supply effectively,” he added.

“However, while Brent’s positioning improved to the 35th percentile for weeks since 2010, the WTI positioning remains in historically bearish territory, reflecting broader market skepticism,” he continued.

To contact the author, email andreas.exarheas@rigzone.com

• Gold price bounces early Friday after correcting from five-week highs of $2,726 on Thursday.       
• Hot US PPI data boost hawkish December Fed rate cut bets, propping up the US Dollar, Treasury bond yields.
• Gold price looks to regain $2,700 and beyond as the daily RSI stays bullish and the 50-day SMA holds.

Gold’s price looks to resume this week’s recovery to monthly highs of $2,726 early Friday, following Wednesday’s brief aberration. The US Dollar (USD) consolidates recent gains alongside the US Treasury bond yields amid a relatively light economic calendar heading into the weekend.

Gold price gears up for pre-Fed repositioning

Expectations of a hawkish US Federal Reserve (Fed) interest rate next week fuelled a fresh leg higher in the US Dollar and the US Treasury bond yields on Wednesday, unfolding a corrective decline in Gold price from multi-month highs.

Markets now believe that the Fed could send a hawkish message by signalling a pause in January following the expected 25 basis points (bps) rate cut at its December 17-18 policy meeting, especially after the US Producer Price Index (PPI) data came in hotter-than-expected.

The annual PPI rose 3.0% in November, above the market expectation of a 2.6% growth. Meanwhile, the annual core PPI rose 3.4% in the same period, surpassing the estimate of 3.2%. The monthly PPI and the core PPI rose 0.4% and 0.2%, respectively. Markets are fully pricing in a 25 bps rate cut by the Fed next week, the CME Group’s FedWatch Tool shows.

Meanwhile, the USD also drew support from a EUR/USD sell-off in the face of a dovish rate cut delivered by the European Central Bank (ECB). Additionally, rallying US Treasury bond yields on solid bond auctions this week underpinned the sentiment around the Greenback while capping the Gold price uptrend.

In Friday’s trading so far, Gold price is finding fresh demand as China’s stimulus optimism fades on increasing worries over the US-Sino trade war. In a gated story, the Wall Street Journal (WSJ) reported that China has already begun retaliating to the upcoming US President-elect Donald Trump’s tariffs by deploying non-tariff measures. “China launched a regulatory probe into Nvidia, threatened to blacklist an American apparel maker, blocked the export of critical minerals to the US and squeezed the supply chain for drones,” the WSJ said.

Markets will continue to take cues from broader market sentiment without any top-tier US economic data releases later in the day. The end-of-the-week flows and repositioning ahead of next week’s Fed policy decision will also play their part in driving Gold price.

Gold price technical analysis: Daily chart

Gold price faced rejection at higher levels on Thursday and turned south before finding support at the 50-day Simple Moving Average (SMA) at $2,671 early Friday.

The 14-day Relative Strength Index (RSI) has also witnessed a renewed upside while holding well above the 50 level.

If Gold price resumes the recovery momentum, it could retest the multi-week high of $2,726, above which 2,750, the confluence of the psychological barrier and the November 5 high, will act as a tough nut to crack.

A failure to defend the 50-day SMA support at $2,671 on a daily candlestick closing basis will prompt sellers to target the 21-day SMA at $2,650 once again.

The last line of defence for Gold buyers is seen at the previous week’s low of $2,613.

Retest of 20-Day MA Support Looks Likely

It looks like a test of the 20-Day MA may be in process. The 20-Day line, now at 3.19, was reclaimed on Tuesday with a bullish doji hammer candlestick pattern. So, this pullback will be the first real test of support around the 20-Day line since natural gas rose away from the line three days ago. Therefore, it should reject price to the upside. Keep in mind though that there were four days near the recent lows where trading occurred below the 20-Day line, then quickly recovered. That could happen again on this test.

Close Below 3.28 Would Fail to Confirm Weekly Breakout

An important observation to consider is indicated in the weekly chart (not shown). There was a bullish weekly reversal that triggered above last week’s high of 3.28 earlier this week. The high for the week was 3.56 and the low was 3.07. However, given today’s pullback and where natural gas is now trading, there is a risk that the weekly breakout will not be confirmed with a weekly close above last week’s high. Something to look at as a close below the high could be interpreted as another bearish indication that could lead to a longer recovery before natural gas is once again ready to test recent highs.

Traded Inside Month

Moreover, on the monthly chart (not shown), trading in December has been confined within November’s trading range. Might this month end with an inside month? There is a slight upward bias indicated as this month’s price range is contained within the upper half of November’s range and the high was a direct test of the prior high. But given the failure to break out to new highs yesterday and today’s bearish response, this may be indicating the next test of highs may not occur until next month.

For a look at all of today’s economic events, check out our economic calendar.

• Silver struggles at $31.00, declines over 1% to test the 100-day SMA amid rising US bond yields.
• Technical outlook sees potential consolidation between the 100-day and 200-day SMAs, with key support at $29.49.
• Resistance levels ahead at $31.00 and $31.64, with potential upward movement towards $32.00 if regained.

Silver prices dropped on Friday after buyers could not hold prices above $31.00. Even though there are expectations that the US Federal Reserve will cut interest rates next week, US yields are rising, a headwind for the precious metals segment. The XAG/USD trades at $30.53, down more than 1%, testing the 100-day Simple Moving Average (SMA).

XAG/USD Price Forecast: Technical outlook

Next week’s events would provide a catalyst and define Silver’s path toward the end of the year. Despite this, the grey metal is set to finish with gains of over 30%, but in the short term, it could consolidate within the 100-day SMA and the 200-day SMA at $29.49.

If buyers push prices above $31.00, the next resistance level would be the 50-day SMA at $31.64. A breach of the latter will expose $32.00 before aiming for higher prices at $33.00.

Conversely, if sellers clear the 100-day SMA, the next support would be the $30.00 figure. Once hurdled, the next support would be the November 28 daily low of $29.64 before testing the 200-day SMA.

XAG/USD Price Chart – Daily

• Gold price turns lower after hitting five-week highs near $2,725 early Thursday.       
• Rising US Treasury bond yields offset Fed rate cut optimism ahead of US PPI, jobs data.
• Gold price pulls back before the next push higher as the daily RSI stays bullish.

Gold’s price seems to have paused its four-day recovery stint in Asian trading on Thursday after hitting fresh five-week highs near $2,725. Traders assess the odds of US Federal Reserve (Fed) interest rate cuts next year amid the ongoing upsurge in the US Treasury bond yields across curve.  

Gold price looks to US data for further impetus

Gold price has benefited this week from expectations of Chinese stimulus, Fed rate cut optimism, Middle East geopolitical tensions and the advance in the US Treasury bond yields. Despite an imminent Fed rate cut next week, US Treasury bond yields remain firm on ample supply of long-data US bonds and a widening budget deficit.

The latest data showed that the US government posted a $367 billion budget deficit for November, up 17% from a year earlier. Meanwhile, the Treasury Department saw good demand for a $39 billion sale of 10-year notes, the second sale of $119 billion in coupon-bearing sales after a solid $58 auction of three-year notes on Tuesday.

These supporting factors helped the US Treasury bond yields make a strong comeback after the US Consumer Price Index (CPI) data-led downtick. The US Dollar also tracked yields higher even as the US inflation data aligned with market expectations. Data showed that the US annual CPI and core rose  2.7% and 3.3%, respectively, while on a monthly basis, both figures came in at 0.3%.

Markets are now predicting a 91% chance of the Fed lowering rates by 25 basis points (bps) next week while the odds for a January rate cut edge down to about 19%, the CME Group’s FedWatch Tool shows.

Despite this Gold price remained underpinned and clinched two-week highs at $2,721 on Wednesday. Uncertainty over the Syrian political environment, China’s stimulus optimism and the People’s Bank of China’s (PBOC) addition to its Gold reserves rendered positive for the non-yielding Gold price.

However, buyers seem to have turned cautious early Thursday, despite the US Dollar pullback as US Treasury bond yields continue to trend higher, anticipating the sale of $22 billion in 30-year bonds later in the day.

The  focus also remains on the US Producer Price Index (PPI) and the weekly Jobless Claims data for fresh hints on the path of the Fed’s easy policy and the direction of the USD heading into the Fed meeting next week. The sentiment surrounding the Fed and risk trends will continue to play a crucial role in the Gold price action.

Gold price technical analysis: Daily chart

The daily chart shows that the Gold price has turned south in tandem with the 14-day Relative Strength Index (RSI) so far this Thursday.

The leading indicator eases toward 50.00 while holding well above it.

If the pullback from the multi-week high extends, Gold price could find initial demand at the 50-day Simple Moving Average (SMA) at $2,671.

The next relevant downside targets align at the 21-day SMA at $2,646, below which the previous week’s low of $2,613 will be tested.

However, if buyers regain poise, Gold price could retest the multi-week high of $2,726, above which 2,750, the confluence of the psychological barrier and the November 5 high, will act as a tough nut to crack.

Fresh buying opportunities will likely emerge on a sustained move above the latter, calling for a test of the record high of $2,790.

• Gold price rebounds to around $2,690 in Friday’s Asian session, adding 42% on the day. 
• Gold demand and geopolitical risks could support the Gold price. 
• The cautious stance of the Fed due to Trump tariff policies might put pressure on the USD-denominated Gold. 

Gold price (XAU/USD) recovers some lost ground to around $2,690 during the Asian trading hours on Friday after retreating from a five-week high in the previous session. All eyes will be on the US Federal Reserve (Fed) interest rate decision next week.

Gold buying by central banks, including the People’s Bank of China (PBoC) could provide some support on the yellow metal. The Chinese central bank resumed gold purchases in November after a six-month hiatus, increasing its reserves to 72.96 million fine troy ounces. This move comes as Beijing signals a shift to an “appropriately loose” monetary policy, with plans for a more proactive fiscal approach in 2024. Goldman Sachs analysts noted that the People’s Bank of China (PBoC) “may even increase Gold demand during periods of local currency weakness to boost confidence in their currency.”  

Additionally, the escalating tensions in the Middle East might boost the safe-haven demand flows, benefiting the precious metal. Reuters reported that an Israeli strike killed at least 30 Palestinians and wounded 50 others who were sheltering in a post office in the central Gaza Strip, bringing the death toll on Thursday in the enclave to 66.

On the other hand, the speculations that US President-elect Donald Trump’s tariff policies might prompt inflation might convince the Fed to adopt a more cautious stance on cutting interest rates. This, in turn, could act as a headwind for non-yielding assets like gold. According to CME Group’s FedWatch Tool, traders are now pricing in a nearly 96.4% chance that the Fed will reduce its rate by 25 basis points (bps) rate cut at the December meeting.

• Silver price extends its losses amid a momentum shift to bearish from bullish bias.
• The emergence of the bearish bias is confirmed as the 14-day RSI breaks below the 50 mark.
• XAG/USD may find immediate barriers at the 14-day EMA at $31.17, aligned with the nine-day EMA at $31.22.

Silver price (XAG/USD) extends its losses for the second session, trading around $30.90 per troy ounce during the Asian hours on Friday. The daily chart analysis indicates a momentum shift to bearish from bullish bias as the pair has broken below the ascending channel pattern.

The XAG/USD pair moves below the nine- and 14-day Exponential Moving Averages (EMA), indicating an ongoing bearish outlook and signaling to weaken short-term price momentum. This points to increasing selling interest and raises the likelihood of further price depreciation.

Additionally, the 14-day Relative Strength Index (RSI) falls below the 50 mark, further confirming the emergence of the bearish bias.

On the downside, the XAG/USD pair could navigate the region around the psychological level of $30.00, followed by a “throwback support” level at its three-month low of $29.65, which was recorded on November 28.

The immediate barriers appear at the 14-day EMA at $31.18, followed by the nine-day EMA at $31.22. A break above these levels could cause the bullish bias to re-emerge and help the Silver price to return to the ascending channel pattern.

A return to the channel would support the XAG/USD pair to retest its five-week high of $32.28, followed by the ascending channel’s upper boundary at $33.00.

XAG/USD: Daily Chart

Breakout Above 3.56 is Bullish

Nonetheless, a decisive advance above 3.56 triggers a continuation of the bull trend. And a new portion of the trend has likely recently begun, following the upside breakout of a symmetrical triangle pattern on November 20. The recent retracement found support around the 61.8% Fibonacci support level and the pattern breakout level of 3.02, which eventually lead to an improvement in upward momentum as seen the past couple of days.

Moreover, a weekly bullish reversal triggered this week on a rally above last week’s high of 3.28, and the week should end above the high, thereby confirming the reversal. This is classic bullish behavior given the subsequent rebound from the 2.98 swing low.

First 3.64, then 4.06?

A decisive rally above the 3.56 high puts natural gas on track to target the 2023 high of 3.64, and likely continue to rise from there. The high is the top of the triangle pattern and a rally above the top of the pattern would provide another piece of bullish evidence if triggered. There are several higher targets thereafter as marked on the chart. The more significant and higher price target is up around a price range from 4.39 to 4.56. That range begins with prior monthly support and ends with a 50% retracement level.

Higher Targets

On the way towards 4.39, if natural gas continues to strengthen, the first area to watch for resistance above the 3.64 peak is 4.06. That is where a rising ABCD pattern (purple) hits its 161.8% extended target. However, that will likely be a minor level heading towards a price zone around a 38.2% Fibonacci retracement at 3.85. Close by is the 127.2% extension of a large rising ABCD pattern (orange) at 3.87. Watch the price levels together as a range.

For a look at all of today’s economic events, check out our economic calendar.

XAU/USD Current price: $2,681.86

• Dismal United States data fueled speculation the Federal Reserve will trim rates in 2025.
• The European Central Bank cut benchmark rates by 25 bps each, as expected.
• XAU/USD turned bearish in the near term after breaking below $2,700.

Spot Gold came under selling pressure on Thursday, trading around $2,680 a troy ounce. The US Dollar (USD) gathered momentum early in the American session following the release of dismal United States (US) data.

The country reported that  Initial Jobless Claims for the week ended December 6 increased to 242K, worse than the 220K expected and above the previous 225K. Additionally, the November Producer Price Index (PPI) came in higher than anticipated, rising 3.4% on a yearly basis against the expected 3.2% and the previous 3.1%. The news pushed speculative interest into further betting on Federal Reserve (Fed) interest rate cuts through 2025.

Wall Street started the day with modest optimism but finally gave up. The three major indexes trade in the red, reflecting the poor sentiment. For a change, however, the USD has gathered more attention than gold as a safe haven.

Market players are now heading into a more quiet day, as the macroeconomic calendar has nothing relevant to offer on Friday. However, the Bank of Japan (BoJ), the Federal Reserve (Fed) and the Bank of England (BoE) will announce their decisions on monetary policy next week. Most rate decisions are widely anticipated, with the focus on what 2025 may bring to monetary policy.

XAU/USD short-term technical outlook

Technically, the XAU/USD pair is at risk of extending its slide, albeit far from bearish. The daily chart shows that the pair keeps developing above all its moving averages, with the 20 Simple Moving Average (SMA) maintaining its upward slope below the current level and above also bullish 100 and 200 SMAs. However, technical indicators have turned south, with the Momentum heading firmly south below its 100 level and the RSI also pointing lower, albeit at around 54.

In the near term, and according to the 4-hour chart, XAU/USD is currently developing below its 20 SMA, which anyway remains above directionless longer ones. The corrective decline could continue, given that technical indicators head firmly lower, although considering the Momentum indicator remains above its 100 line.

Support levels: 2,676.30 2,662.50 2,650.40  

Resistance levels: 2,693.70 2,704.35 2,722.60

• Silver price falls back to near $31.50 after posting a fresh two-week high around $32.20.
• Chinese officials proposed to increase the issuance of bonds to boost infrastructure investment.
• The US producer inflation grew at a faster-than-expected pace in November.

Silver price (XAG/USD) gives up its entire gains and declines to near $31.50 in the North American session on Thursday. The white metal declines after posting a fresh two-week high around $32.20. The asset faces pressure after the conclusion of China’s two-day economic work conference. a high-level meeting that sets economic priorities for next year.

Top leaders of China didn’t provide specific details on the likely size of the stimulus package and the pace of monetary policy easing. However, officials said that they will increase the issuance of ultra-long special treasury bonds and local government special notes next year, which are important sources for infrastructure investment and other public spending, Bloomberg reported.

Investors await more details on the stimulus package to forecast the demand for Silver, given its application in various industries such as solar panels and mining, etc.

Meanwhile, hotter-than-expected United States (US) Producer Price Index (PPI) data for November has also weighed on the Silver price. As measured by the PPI, annual headline and core producer inflation accelerated to 3% and 3.4%, respectively. The impact of the hit US PPI data appears to be negligible on Federal Reserve (Fed) interest rate projections for the policy meeting on December 18 but could boost expectations that the central bank will pause the policy-easing spell in January.

After the US PPI data release, the US Dollar Index (DXY) recovered intraday losses and rises to near 106.80 and weighed on the Silver price.

Silver technical analysis

Silver price retreats after failing to revisit the horizontal resistance plotted from the May 21 high of $32.50. The near-term appeal of the Silver price remains firm until it stays above the 20-day Exponential Moving Average (EMA), which trades around $31.25.

The 14-day Relative Strength Index (RSI) approaches 60.00. A bullish momentum would trigger a decisive break above the same.

Looking down, the upward-sloping trendline is around $29.50, which is plotted from the February 29 low of $22.30 on a daily timeframe

Silver daily chart