The expectation of a Fed rate cut supports the rebound in gold prices, and the market is awaiting inflation data this week to confirm the timing of the rate cut. 

The Russian government has ordered restrictions on oil production, and attacks on energy infrastructure in Russia and Ukraine have offset the United Nations’ call for a ceasefire in Gaza, pushing oil prices up by more than 1%.  

Gold >>  

The expectation of a Fed rate cut is supporting gold prices, with the market waiting for inflation data this week to confirm the timing of the rate cut.  

Due to a decline in the US dollar, spot gold rebounded slightly, briefly breaking above the USD 2180 level during the US session but failing to hold steady, ultimately closing up 0.3% at USD 2171.90 per ounce. 

Market sentiment leans towards the Fed starting to cut rates from June, as Fed Chair Powell indicated during a press conference that an unexpected rise in unemployment could lead the central bank to consider lowering rates.  

Powell also assured the market that the Fed would not react hastily to consecutive months of rising inflation data. Additionally, recent statements from Fed policymakers suggest that despite recent high inflation data, they still expect to lower rates by 75 basis points by the end of 2024, which is boosting gold prices. 

On the technical side, gold continued to trade in a range between 2163 and 2181 yesterday, with volatile swings.  

During the Asian session, there was a slight upward spike breaking through the 2178 level before retreating further, then oscillating above the 2163 level in a sideways pattern during the afternoon.  

In the evening, there was a strong push downwards followed by a rebound, breaking through the morning’s opening gap around the 2178 level and accelerating upwards to breach the 2181 level before retreating and closing with oscillations. 

Technical Analysis: 

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 2181-2186. 
• Key support levels to watch in the short term are around 2146-2157. 

WTI Crude Oil >> 

The Russian government’s order to restrict oil production, along with attacks on energy infrastructure in Russia and Ukraine, has fueled bullish sentiment in the oil market.  

WTI crude oil rose by over 1%, briefly reaching USD 82 during the US session, and ultimately closing up 1.44% at USD 81.92 per barrel; Brent crude oil closed up 0.57% at USD 86.01 per barrel. 

The escalation of geopolitical tensions has raised concerns about global oil supply in the market. Additionally, the decrease in the active rig count in the United States has exacerbated supply concerns. 

On the technical side, oil prices stabilized above the USD 80.7 level yesterday, with strong bullish momentum pushing prices higher after testing lows. During the Asian and European sessions, prices slightly dipped before rebounding and stabilizing around the USD 80.7 level, then gradually rising.  

In the late US session, oil prices surged higher, breaking through and holding above the previous 4-hour opening gap near USD 81.8 and continuing to rise to around the USD 82.4 level before a slight pullback and a strong close. 

Technical Analysis: 

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 82.6-83.0. 
• Key support levels to monitor in the short term are around 79.5-80.0. 

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