The stock market and government bonds experienced a slight decline, with rising bond yields supporting an increase in the U.S. dollar.
This led to the U.S. dollar achieving its largest single-day gain since March of the previous year on the first trading day of the new year. Gold prices faced downward pressure, resulting in a decline.
On the first trading day of 2024, oil prices also saw a decrease, with settlement prices for both Brent and WTI dropping by over 1%. U.S. crude oil recorded its fourth consecutive trading day of declines.
On Tuesday, spot gold fell by 0.19%, closing at USD 2058.86 per ounce; gold futures rose by 0.08%, reaching USD 2073.4 per ounce.
After the U.S. Purchasing Managers’ Index (PMI) data came in below expectations, both the stock market and commodities declined, causing spot gold prices to retreat to recent mid-range levels.
As market speculation on the extent of the Fed’s interest rate cut in 2024 diminished, the U.S. dollar experienced its largest single-day increase since March of the previous year on the first trading day of 2024.
The U.S. dollar index rose by over 0.7%, while U.S. Treasury bonds and the stock market simultaneously declined. This marks the largest single-day gain for the U.S. dollar since the regional banking crisis in the United States over nine months ago.
On the technical side, gold prices initially rose and then fell. During the Asian-European session, prices oscillated slightly higher, relying on the USD 2064 level. In the afternoon, the upward momentum accelerated, reaching above USD 2074 and continuing to consolidate strongly.
In the evening, prior to the U.S. session, gold prices faced pressure around the USD 2078 level, once again oscillating lower and dropping to the USD 2065 level where the consolidation phase near the initial rise began.
In the evening, gold prices repeatedly surged higher but faced resistance around the USD 2070 level, experiencing another round of weak downward movement, closing below the previous bottom.
Today’s short-term strategy for gold suggests prioritizing short positions during rebounds, with long positions considered as a secondary approach during pullbacks.
- Key resistance levels to watch in the short term are around 2070-2075.
- Key support levels to watch in the short term are around 2050-2045.
WTI Crude Oil >>
On Tuesday, due to reduced expectations of interest rate cuts in the market, the strengthening U.S. dollar exerted pressure on oil prices.
On the first trading day of 2024, international crude oil futures settlement prices dropped by over 1%. U.S. crude oil futures fell by USD 1.27 per barrel, a decline of 1.78%, closing at USD 70.38 per barrel, marking the fourth consecutive trading day of declines.
Brent crude oil closed at USD 76.01 per barrel, down 1.34%. A U.S. helicopter repelled an attack by Iran-backed Houthi militants on a container ship operated by Danish shipping company Maersk (MAERSKb.CO) in the Red Sea.
According to the semi-official Tasnim news agency, on Monday, an Iranian warship entered the Red Sea. On the technical side, oil prices experienced bearish oscillations, breaking through support levels amid volatile trading.
During the Asian-European session, prices oscillated slightly higher, relying on the USD 72.4 level, before accelerating higher in the afternoon and breaching the USD 73.6 level. However, they faced resistance and fell back into a sideways oscillation.
In the evening U.S. session, prices were pressured below USD 73.6, leading to an accelerated bearish movement, ultimately closing below the USD 71 level, reaching around USD 70. This marked a high-to-low reversal, with four consecutive trading days of downward pressure and oscillations before closing.
Today’s crude oil trading strategy suggests prioritizing short positions during rebounds, with long positions considered as a secondary approach during pullbacks.
- Key resistance levels to monitor in the short term are around 71.5-72.0.
- Key support levels to monitor in the short term are around 69.0-68.5.
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