Search Mark
Home / Market Insight

Gold Price Hits Five-Month Low, Weaker Dollar Boosts Oil Prices


Investor sentiment was influenced by hawkish views from Federal Reserve officials on interest rates, among other factors. The rise in U.S. Treasury yields and a strong U.S. dollar led to gold hitting a five-month low.  

The U.S. dollar closed slightly lower yesterday, supported by the fundamental backdrop of OPEC+ production cuts, leading to a rebound in oil prices after three consecutive trading days of decline. 

Gold >> 

Gold extended its weak and choppy decline yesterday, impacted by rising global bond yields and a stronger overall U.S. dollar. For the ninth consecutive trading day, gold closed lower, reaching a five-month low and marking the longest single-day decline since 2017. 

Early Thursday, the Federal Reserve released minutes from its July meeting, revealing differences among officials regarding future rate hikes. The uncertainty about whether monetary policy will tighten still relies on data performance, creating ongoing ambiguity.  

Though the meeting minutes contained both dovish and hawkish elements, the prevailing market sentiment leaned towards hawkish, leading U.S. Treasury yields and the dollar to continue their ascent and pressuring gold further. 

From a technical perspective, gold experienced an initial rise followed by a drop yesterday. In the Asia-Europe sessions, the price slightly recovered around the $1890 level, but further rebounded in the afternoon, breaching the $1900 level.  

The price then entered a sideways trend. During the U.S. session, it accelerated towards $1903 but faced resistance, eventually sliding back below $1900 and falling further to around $1885 by early morning, closing weakly. 

Technical Analysis: 

Today, it’s advisable to prioritize shorting on high rebounds, with mild long positions on dips. 

  • Key resistance levels to watch in the short term are around 1905-1910. 
  • Key support levels to watch in the short term are around 1880-1875. 

WTI Crude Oil >> 

In the early Asian market today, WTI crude oil was trading around $80 per barrel. Due to a slight decrease in the U.S. dollar and after three consecutive days of decline, oil prices rebounded yesterday.  

The U.S. Chamber of Commerce indicated that the U.S. economy might experience mild recession by the end of this year and the beginning of next year. 

Recently, the strength and volatility in the U.S. Dollar Index, along with disappointing economic performance from major economies, triggered profit-taking and led to a decline in oil prices.  

However, the U.S. Dollar Index slightly retreated from its two-month high yesterday, and the long-term fundamental support from OPEC+ member countries’ production cuts continued to provide positive support for oil prices. 

From a technical standpoint, oil prices found stability around the $79 level, marking a rebound and recovery. In the Asia-Europe sessions, the price saw consecutive gains, reaching near $80, and then entered a sideways trend.  

During the U.S. session, a slow increase pushed the price towards $80.5, maintaining strength. Ultimately, in the early morning, the price accelerated, breaking through the $81 level, before retreating slightly and closing in a volatile manner. 

Technical Analysis: 

Today’s short-term trading strategy suggests a focus on short positions during high rebounds, with occasional long positions on dips. 

  • Key resistance levels to monitor in the short term are around 81-81.5. 
  • Key support levels to monitor in the short term are around 79-78.5. 

Forward-looking Statements    
This article contains “forward-looking statements” and may be identified by the use of forward-looking terminology such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “hope”, “intend”, “may”, “might”, “plan”, “potential”, “predict”, “should”, or “will”, or other variations thereon or comparable terminology. However, the absence of such terminology does not mean that a statement is not forward-looking. In particular, statements about the expectations, beliefs, plans, objectives, assumptions, future events, or future performance of Doo Prime will be generally assumed as forward-looking statements.     

Doo Prime has provided these forward-looking statements based on all current information available to Doo Prime and Doo Prime’s current expectations, assumptions, estimates, and projections. While Doo Prime believes these expectations, assumptions, estimations, and projections are reasonable, these forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond Doo Prime’s control. Such risks and uncertainties may cause results, performance, or achievements materially different from those expressed or implied by the forward-looking statements.     

Doo Prime does not provide any representation or warranty on the reliability, accuracy, or completeness of such statements. Doo Prime is not obliged to provide or release any updates or revisions to any forward-looking statements.    

 
Disclaimer    

While every effort has been made to ensure the accuracy of the information in this document, DOO Prime does not warrant or guarantee the accuracy, completeness or reliability of this information. DOO Prime does not accept responsibility for any losses or damages arising directly or indirectly, from the use of this document. The material contained in this document is provided solely for general information and educational purposes and is not and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, securities, futures, options, bonds or any other relevant financial instruments or investments. Nothing in this document should be taken as making any recommendations or providing any investment or other advice with respect to the purchase, sale or other disposition of financial instruments, any related products or any other products, securities or investments. Trading involves risk and you are advised to exercise caution in relation to the report. Before making any investment decision, prospective investors should seek advice from their own financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision. 

Share to

Market Insight

Gold Prices Climb Approaching 2400 Mark Again, Oil Prices Bottom Out and Rebound 

Despite the rise in the US dollar and US Treasury yields following stronger-than-expected US March retail sales data, aided by safe-haven demand driven by tensions in the Middle East, gold prices climbed 1.64%, once again approaching the 2400 level. 

2024-4-16 | Market Insight

Safe-haven Demand Rises: Gold Surges Nearly USD 30, Oil Prices Edge Up by About 1% 

Last Saturday evening, influenced by the escalation of the Middle East situation over the weekend, there was a push for safe-haven assets, causing the price of gold to briefly spike nearly USD 30.  

2024-4-15 | Market Insight

Gold Price Hits Record High for Seventh Consecutive Day, Oil Price Drops Over 2% at One Point 

Assisted by central bank buying and geopolitical tensions, strong economic data failed to weaken the appeal of gold. On Monday, gold prices hit a record high for the seventh consecutive trading day at USD 2353.83 per ounce.  

2024-4-9 | Market Insight