Investors are focusing on several critical economic indicators scheduled for release this week. The US gross domestic product (GDP) for the first quarter is expected to show a growth of 2.4%, according to economists surveyed by Dow Jones. Moreover, weekly initial jobless claims and the personal consumption expenditures (PCE) price index, which is the Fed’s favored gauge of inflation, are also due. These data points are likely to be significant in shaping the Federal Reserve’s upcoming policy decisions.
Market Sentiment and Expectations
While the market is not anticipating changes in interest rates at the next Federal Reserve meeting, investors are watching for hints of potential rate cuts later this year. Market sentiment, as tracked by CME Group’s FedWatch tool, suggests a possible rate cut by September, depending heavily on the trend of incoming economic data. Furthermore, gold prices have corrected significantly, dropping over $100 from the April 12 peak of $2,431.29, influenced by profit-taking and easing tensions in the Middle East.
Short-Term Outlook for Gold
The short-term direction for gold prices will depend heavily on the upcoming US economic data releases. If the core PCE index meets or falls below expectations, the dollar could weaken further, which might push gold prices higher. On the other hand, if inflation figures come in above expectations, gold might face downward pressure as it would likely lead to a more aggressive interest rate stance from the Fed.
In conclusion, the gold market is displaying cautious optimism, bolstered by a weakening dollar and strategic purchases from Asia, particularly China. However, the upcoming US economic data and Federal Reserve policy decisions are key factors that could influence market sentiment. Traders are preparing for a potential uptick in gold prices, dependent on favorable economic reports and stable interest rate projections.
Oil prices remained stable on Thursday, balancing the effects of decreased fuel demand in the U.S.—the world’s largest oil consumer—with potential geopolitical conflicts in the Middle East. Recent data from the U.S. Energy Information Administration revealed a significant drop in gasoline and distillate fuel demand, underscoring a slowdown in U.S. economic activities.
Despite this, escalating tensions in the Gaza Strip and potential disruptions in Middle Eastern oil supplies are keeping market sentiments cautious. Analysts predict that summer demand, supply constraints, and Chinese and Eurozone economic data will be key drivers of oil prices this quarter.
Gold price pauses losing streak, as focus shifts to the high-impact US Q1 GDP data.
US Dollar decline offers comfort to Gold price amid ebbing Middle East tensions.
Gold price closes Wednesday below 21-day SMA but RSI stays bullish.
Gold price is breathing a sigh of relief early Thursday after testing offers near $2,315 once again. Broad risk-aversion seems to be helping Gold price find a floor, as traders refrain from placing any fresh directional bets on the bright metal ahead of the preliminary reading of the US first-quarter Gross Domestic Product (GDP) due later on Thursday.
Will US GDP data rescue Gold price?
Risk-off sentiment remains in full swing in Asia this Thursday, as market participants sulk following Meta’s weak revenue guidance even though the company’s first-quarter earnings results topped estimates. Meta shares plunged 16% in post-market trading after the company said it expects sales in the second quarter of $36.5 billion to $39 billion, below analysts’ estimate of $38.3 billion. Meanwhile, Meta’s net income more than doubled to $12.37 billion from $5.71 billion over the year.
Investors also stay risk-averse amid mounting risks of a Japanese forex market intervention, as the USD/JPY pair renews fresh 34-year highs near 155.50. Additionally, a sense of caution also prevails, as the upcoming quarterly US GDP and PCE inflation prints could shed more light on the US economic resilience, as well as, on the Federal Reserve (Fed) interest rate outlook.
Weak S&P Global US business PMI data already cast doubt on the US economic prospects amid increased expectations that the Fed could maintain interest rates ‘higher for longer’. Markets price in the first Fed rate cut in September, according to the CME Group’s FedWatch Tool. Meanwhile, the total easing expected this year would just be 40 basis points (bps), a sea change from about 150 basis points of cuts priced in at the beginning of the year, per Reuters.
Meanwhile, the latest data from the UK’s Office for National Statistics (ONS) showed early Thursday that shipping traffic through the Suez Canal artery in Egypt has plunged by 66%, in the face of the Iran-backed Houthi attacks, flagging higher inflation risks.
Amidst a risk-off mood and worries over inflation resurgence worldwide, Gold price is attempting a tepid recovery. Although any upside attempts are likely to remain limited ahead of the key US data flow.
Gold price technical analysis: Daily chart
As observed on the daily chart, Gold price settled Wednesday below the key 21-day Simple Moving Average (SMA), then at $2,318, reinforcing bearish interests.
However, the 14-day Relative Strength Index (RSI), a leading indicator, still holds well above the midline, near 56.00, indicating that a renewed downside in Gold price could be seen as a good entry position for buyers.
If Gold sellers regain control, Gold price could challenge the $2,300 threshold again, below which Tuesday’s low of $2,291 will be targetted. The last line of defense for Gold buyers could be the early April low near $2,265.
On the flip side, a sustained recovery above the 21-day SMA support-turned-resistance, now at $2,324, could revive bullish commitments for a test of the $2,350 psychological level.
Further up, Gold buyers will target the static resistance near $2,360-$2,365.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Gold price pauses losing streak, as focus shifts to the high-impact US Q1 GDP data.
US Dollar decline offers comfort to Gold price amid ebbing Middle East tensions.
Gold price closes Wednesday below 21-day SMA but RSI stays bullish.
Gold price is breathing a sigh of relief early Thursday after testing offers near $2,315 once again. Broad risk-aversion seems to be helping Gold price find a floor, as traders refrain from placing any fresh directional bets on the bright metal ahead of the preliminary reading of the US first-quarter Gross Domestic Product (GDP) due later on Thursday.
Will US GDP data rescue Gold price?
Risk-off sentiment remains in full swing in Asia this Thursday, as market participants sulk following Meta’s weak revenue guidance even though the company’s first-quarter earnings results topped estimates. Meta shares plunged 16% in post-market trading after the company said it expects sales in the second quarter of $36.5 billion to $39 billion, below analysts’ estimate of $38.3 billion. Meanwhile, Meta’s net income more than doubled to $12.37 billion from $5.71 billion over the year.
Investors also stay risk-averse amid mounting risks of a Japanese forex market intervention, as the USD/JPY pair renews fresh 34-year highs near 155.50. Additionally, a sense of caution also prevails, as the upcoming quarterly US GDP and PCE inflation prints could shed more light on the US economic resilience, as well as, on the Federal Reserve (Fed) interest rate outlook.
Weak S&P Global US business PMI data already cast doubt on the US economic prospects amid increased expectations that the Fed could maintain interest rates ‘higher for longer’. Markets price in the first Fed rate cut in September, according to the CME Group’s FedWatch Tool. Meanwhile, the total easing expected this year would just be 40 basis points (bps), a sea change from about 150 basis points of cuts priced in at the beginning of the year, per Reuters.
Meanwhile, the latest data from the UK’s Office for National Statistics (ONS) showed early Thursday that shipping traffic through the Suez Canal artery in Egypt has plunged by 66%, in the face of the Iran-backed Houthi attacks, flagging higher inflation risks.
Amidst a risk-off mood and worries over inflation resurgence worldwide, Gold price is attempting a tepid recovery. Although any upside attempts are likely to remain limited ahead of the key US data flow.
Gold price technical analysis: Daily chart
As observed on the daily chart, Gold price settled Wednesday below the key 21-day Simple Moving Average (SMA), then at $2,318, reinforcing bearish interests.
However, the 14-day Relative Strength Index (RSI), a leading indicator, still holds well above the midline, near 56.00, indicating that a renewed downside in Gold price could be seen as a good entry position for buyers.
If Gold sellers regain control, Gold price could challenge the $2,300 threshold again, below which Tuesday’s low of $2,291 will be targetted. The last line of defense for Gold buyers could be the early April low near $2,265.
On the flip side, a sustained recovery above the 21-day SMA support-turned-resistance, now at $2,324, could revive bullish commitments for a test of the $2,350 psychological level.
Further up, Gold buyers will target the static resistance near $2,360-$2,365.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Important DisclaimersThe content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party’s services, and does not assume responsibility for your use of any such third party’s website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.Risk DisclaimersThis website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
Important DisclaimersThe content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party’s services, and does not assume responsibility for your use of any such third party’s website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.Risk DisclaimersThis website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
United States´ second round of tepid data weighed on Wall Street.
Upcoming US data could speed up the Federal Reserve’s decision to trim rates.
XAU/USD turned near-term neutral, bulls seem unwilling to give up.
Gold consolidative phase continued on Wednesday, with XAU/USD seesawing around $2,325.00 a troy ounce. Financial markets are gearing up for upcoming first-tier United States (US) data following a batch of discouraging figures. Following softer-than-anticipated S&P Global PMIs released on Monday, the country reported Durable Goods Orders rose 2.3% in March, missing the 2.5% anticipated. Furthermore, the February reading was downwardly revised to 1.5% from the previous estimate of 2.2%.
Overall, US data is showing the economy is not doing well enough for the Federal Reserve (Fed) to maintain rates at current record highs for as long as policymakers may want. Market participants are starting to suspect so and will get some certainties in the next couple of days. On Thursday, the US will release the preliminary estimate of the Q1 Gross Domestic Product (GDP), which is expected to show that the economy grew at an annualized pace of 2.5% in the three months to March. On Friday, the focus will shift to the March Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s (Fed) favorite inflation gauge.
Meanwhile, intraday news affected Wall Street. US indexes trade with modest losses, unable to replicate the positive tone of their Asian and European counterparts. The US Dollar is also suffering from softer-than-anticipated figures, although activity remains limited across the different boards.
XAU/USD short-term technical outlook
XAU/USD keeps hovering around the 23.6% Fibonacci retracement of the $1,996.06/$2,431.43 rally, unable to clearly recover above the level. The daily chart shows the pair is also stuck around a bullish 20 Simple Moving Average (SMA), while technical indicators lack directional strength just above their midlines. It seems that sellers are not yet willing to jump in while buyers are making tepid attempts to resume the rally.
Technical readings in the 4-hour chart show limited bullish potential, as the pair trades below the 20 and 100 Simple Moving Averages (SMAs), with the shorter one accelerating south below the longer one, usually seen as a sign of growing selling pressure. Technical indicators, in the meantime, remain within negative levels, with the Momentum indicator advancing and the Relative Strength Index (RSI) indicator consolidating around 43.
Support levels: 2,310.00 2,295.20 2,282.90
Resistance levels: 2,348.30 2,361.55 2,372.90
XAU/USD Current price: $2,328.21
United States´ second round of tepid data weighed on Wall Street.
Upcoming US data could speed up the Federal Reserve’s decision to trim rates.
XAU/USD turned near-term neutral, bulls seem unwilling to give up.
Gold consolidative phase continued on Wednesday, with XAU/USD seesawing around $2,325.00 a troy ounce. Financial markets are gearing up for upcoming first-tier United States (US) data following a batch of discouraging figures. Following softer-than-anticipated S&P Global PMIs released on Monday, the country reported Durable Goods Orders rose 2.3% in March, missing the 2.5% anticipated. Furthermore, the February reading was downwardly revised to 1.5% from the previous estimate of 2.2%.
Overall, US data is showing the economy is not doing well enough for the Federal Reserve (Fed) to maintain rates at current record highs for as long as policymakers may want. Market participants are starting to suspect so and will get some certainties in the next couple of days. On Thursday, the US will release the preliminary estimate of the Q1 Gross Domestic Product (GDP), which is expected to show that the economy grew at an annualized pace of 2.5% in the three months to March. On Friday, the focus will shift to the March Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s (Fed) favorite inflation gauge.
Meanwhile, intraday news affected Wall Street. US indexes trade with modest losses, unable to replicate the positive tone of their Asian and European counterparts. The US Dollar is also suffering from softer-than-anticipated figures, although activity remains limited across the different boards.
XAU/USD short-term technical outlook
XAU/USD keeps hovering around the 23.6% Fibonacci retracement of the $1,996.06/$2,431.43 rally, unable to clearly recover above the level. The daily chart shows the pair is also stuck around a bullish 20 Simple Moving Average (SMA), while technical indicators lack directional strength just above their midlines. It seems that sellers are not yet willing to jump in while buyers are making tepid attempts to resume the rally.
Technical readings in the 4-hour chart show limited bullish potential, as the pair trades below the 20 and 100 Simple Moving Averages (SMAs), with the shorter one accelerating south below the longer one, usually seen as a sign of growing selling pressure. Technical indicators, in the meantime, remain within negative levels, with the Momentum indicator advancing and the Relative Strength Index (RSI) indicator consolidating around 43.
Wednesday’s oil prices edged higher after unexpected U.S. crude stock reductions suggested strong demand, juxtaposed with ongoing Middle East tensions. Contrary to forecasts of an 800,000 barrel increase, API data revealed a decrease of over 3 million barrels for the week ending April 19.
A dip in U.S. business activity to a four-month low implies potential rate cuts, potentially spurring oil demand from the top global consumer. While the Middle East conflicts continue, current impacts on oil supplies are minimal, with new sanctions against Iran on the horizon but not immediately affecting supply.
A decisive rally above today’s high will trigger a bullish continuation of the advance that began from the most recent swing low at 1.64. That low tested support around the bottom of a symmetrical triangle consolidation pattern. Once support is seen at the bottom of a triangle and it turns up, a continuation towards the top boundary line of the pattern to test resistance is most likely. Also, since the triangle is well formed, with four points creating the boundaries of the pattern, a breakout can happen from the current advance.
Next Target is Top of Triangle
Resistance may not halt the advance at the top boundary line and instead a breakout could occur. However, keep in mind that upward momentum is essentially beginning from the recent swing low. So, even if the top line is broken there may not be enough demand on the sidelines to keep prices rising in the short term. An alternative bullish scenario would be to see signs of resistance around the top line on the initial approach. And that resistance leads to either consolidation or a pullback as natural gas sets up for a new entry that leads to a decisive upside breakout.
The short-term bearish scenario would see resistance around the top boundary line, leading to a retracement that takes natural gas back down to test support around the lower boundary line. That scenario increases the chance for a bearish breakdown from the triangle pattern.
Weekly Pattern is Bullish
As discussed in Monday’s article on natural gas, the weekly chart pattern shows a breakdown of a bearish shooting star candle last week, followed by a bullish breakout of a hammer candlestick this week. In other words, the market on a weekly basis gave a clear bearish signal, and then flipped around the gave a clear bullish signal. This type of flip from bear to bull in a short period of time is what can lead to sharp moves. In this case up. Certainly, there are no signs of it yet, however.
For a look at all of today’s economic events, check out our economic calendar.
Disappointing United States PMIs pressured the US Dollar after Wall Street’s opening.
Market players await the US Gross Domestic Product and an inflation update.
XAU/USD maintains its bearish tone in the near term, near-term support at $2,310.
Spot Gold trades flat for the day around $2,326, recovering from an intraday low of $2,291.26. XAU/USD fell on the back of a better market mood, keeping the US Dollar on the back against most major currencies. The USD scenario partially changed after the release of discouraging US data, as the preliminary estimates of the April S&P Global PMIs missed the market’s expectations. The Manufacturing PMI shrank to 49.9 from 51.9 in March, while the Services PMI slid to 50.9 from 51.7. The Composite PMI resulted then in 50.9, down from 52.1 in the previous month.
Wall Street shrugged off the dismal figures and maintained a positive tone, but market players decided to sell the USD. Soft growth-related data may force the Federal Reserve (Fed) to trim interest rates sooner rather than later, somehow backing the better tone of equities.
Critical United States (US) data will be released later in the week. The country will unveil the first estimate of the Q1 Gross Domestic Product (GDP) next Thursday, and is expected to show the economy grew at an annualized pace of 2.5% in the three months to March. Also, the US will publish the March Personal Consumption Expenditures (PCE) Price Index on Friday, the Federal Reserve’s (Fed) favorite inflation gauge. The report will lose some of its usual relevance after the GDP data release, which includes a quarterly PCE Price Index estimate, but could still anticipate the Fed’s course.
XAU/USD short-term technical outlook
From a technical point of view, XAU/USD seems poised to extend its slide. It’s currently battling with the 23.6% Fibonacci retracement of the $1,996.06/$2,431.43 rally, unable to recover above the level clearly. Furthermore, the daily chart shows technical indicators maintain uneven downward slopes near their midlines, still retreating from extreme overbought readings. At the same time, XAU/USD remains above bullish moving averages, with the 20 SMA providing near-term support at around $2,310.
In the near term, and according to the 4-hour chart, the risk skews to the downside. A mildly bullish 100 SMA limits intraday advances, while the 20 SMA gains downward traction above the longer one. At the same time, technical indicators corrected from oversold readings before resuming their slides within negative levels.
Support levels: 2,310.00 2,295.20 2,282.90
Resistance levels: 2,348.30 2,361.55 2,372.90
XAU/USD Current price: $2,326.11
Disappointing United States PMIs pressured the US Dollar after Wall Street’s opening.
Market players await the US Gross Domestic Product and an inflation update.
XAU/USD maintains its bearish tone in the near term, near-term support at $2,310.
Spot Gold trades flat for the day around $2,326, recovering from an intraday low of $2,291.26. XAU/USD fell on the back of a better market mood, keeping the US Dollar on the back against most major currencies. The USD scenario partially changed after the release of discouraging US data, as the preliminary estimates of the April S&P Global PMIs missed the market’s expectations. The Manufacturing PMI shrank to 49.9 from 51.9 in March, while the Services PMI slid to 50.9 from 51.7. The Composite PMI resulted then in 50.9, down from 52.1 in the previous month.
Wall Street shrugged off the dismal figures and maintained a positive tone, but market players decided to sell the USD. Soft growth-related data may force the Federal Reserve (Fed) to trim interest rates sooner rather than later, somehow backing the better tone of equities.
Critical United States (US) data will be released later in the week. The country will unveil the first estimate of the Q1 Gross Domestic Product (GDP) next Thursday, and is expected to show the economy grew at an annualized pace of 2.5% in the three months to March. Also, the US will publish the March Personal Consumption Expenditures (PCE) Price Index on Friday, the Federal Reserve’s (Fed) favorite inflation gauge. The report will lose some of its usual relevance after the GDP data release, which includes a quarterly PCE Price Index estimate, but could still anticipate the Fed’s course.
XAU/USD short-term technical outlook
From a technical point of view, XAU/USD seems poised to extend its slide. It’s currently battling with the 23.6% Fibonacci retracement of the $1,996.06/$2,431.43 rally, unable to recover above the level clearly. Furthermore, the daily chart shows technical indicators maintain uneven downward slopes near their midlines, still retreating from extreme overbought readings. At the same time, XAU/USD remains above bullish moving averages, with the 20 SMA providing near-term support at around $2,310.
In the near term, and according to the 4-hour chart, the risk skews to the downside. A mildly bullish 100 SMA limits intraday advances, while the 20 SMA gains downward traction above the longer one. At the same time, technical indicators corrected from oversold readings before resuming their slides within negative levels.
Oil prices rebounded in Asian trading on Tuesday, finding support from the prospect of tightening supplies over the coming months, despite easing concerns of an Iran-Israel war which had previously escalated oil prices to near six-month highs.
The decline in geopolitical risk premiums in oil was linked to reduced fears of direct conflict between Iran and Israel, as Iran downplayed the impact of recent strikes and showed no immediate intent to retaliate.
However, the oil market remains underpinned by structural tightness, notably due to recent production cuts by Russia and steady U.S. fuel demand as the spring driving season kicks off.
Additionally, the U.S. is intensifying sanctions on Iranian oil exports, which could further strain global supply. This backdrop suggests a potentially bullish outlook for oil as driving season approaches, despite the current geopolitical ebb.
Natural Gas Price Forecast
Natural Gas (NG) Price Chart Natural Gas (NG) saw a modest decline in today’s trading session, falling 0.27% to a price of $2.051. The commodity is currently trading just below its pivot point at $2.06, suggesting a cautious market sentiment. If NG surpasses this level, it could indicate a shift towards a bullish trend.
Resistance levels are positioned at $2.11, $2.17, and $2.25, which could cap upward movements. Conversely, support levels are established at $2.00, followed by more substantial floors at $1.91 and $1.85, where buyers might step in.
The 50-day and 200-day Exponential Moving Averages at $1.95 and $1.91 respectively, suggest a potential for price stabilization or an upward correction if declines continue. The overall technical stance indicates a bearish bias below $2.06, but a break above could alter the market outlook to more bullish.
WTI Oil Price Forecast
WTI Price Chart USOIL prices saw a modest increase today, trading at $82.31, up 0.28%. The asset hovers above its pivot point at $81.15, indicating a potential for continued bullish movement if it sustains above this level. Key resistance levels are identified at $84.39, $86.22, and $87.74, which could cap upward trends.
Conversely, support levels are established at $79.60, $78.44, and $76.22, where declines may find a floor. The 50-day and 200-day Exponential Moving Averages, at $83.41 and $82.50 respectively, support a positive bias.
Overall, the market posture is bullish above $81.15, with a break below this threshold possibly triggering a sharper sell-off.
Brent Oil Price Forecast
Brent Price Chart
UKOIL price rose slightly to $87.42, marking a 0.33% increase. Positioned just above the pivot point at $86.14, the outlook remains bullish above this threshold. Resistance levels are set at $88.26, $89.27, and $90.86, potentially challenging further price advances.
Supports are identified at $84.63, $83.17, and $81.80, which may stabilize prices against downward movements. The 50-day Exponential Moving Average (EMA) at $88.24 and the 200-day EMA at $87.02 reinforce the current price dynamics.
The technical posture suggests that remaining above $86.14 is bullish, while a dip below could signal a significant sell-off.
For a look at all of today’s economic events, check out our economic calendar.
Brent Price Chart