Spot gold came under pressure as the U.S. dollar index and bond yields turned higher but held firm, experiencing a slight decline. Oil prices saw significant fluctuations due to the false alarm, ultimately closing near the $74 level.

Gold>>

The U.S. dollar index staged a strong recovery, briefly dropping nearly $10 and breaking below the $1950 level, with a low of $1945.70. Subsequently, the dollar hovered near a more than one-year low.  

Spot gold prices held firm, supported by the weaker dollar, rebounding slightly above the flat line. It closed back above the $1950 level, recording a marginal decline of 0.02% at $1954.98 per ounce. 

Earlier U.S. data hinted at a slowdown in inflation, with consumer price growth reaching its slowest pace in over two years. The Michigan Consumer Confidence Index hit a 21-month high, leading the market to speculate that the Federal Reserve may pause rate hikes after July.  

As signs of cooling inflation become increasingly apparent, investors are eagerly awaiting more clues to gauge how far the Fed’s tightening policy may go. 

Gold traded in a narrow range above the $1945 level on Monday, stabilizing around the $1951 level during the Asian and European sessions. It experienced a small rebound, briefly surpassing the $1956 level but facing resistance and retracing.  

In the pre-U.S. session, it found support near the $1950 level twice, rallying strongly to around $1959, but later faced selling pressure and retreated. Finally, it fell below $1945 again before recovering and closing above the $1950 level. 

Technical Analysis: 

Currently, the market is overall in a downtrend, suggesting a focus on buying on dips as the main strategy, with selling on rebounds as a secondary approach.  

• Key resistance levels to watch in the short term are around 1965-1970.  
• Key support levels to watch in the short term are around 1940-1945. 

WTI Crude Oil >>

Crude oil fell more than 1.5% on Monday as concerns over demand increased and with Libya partially resuming production, putting pressure on oil prices. The market opened and continued to decline, with crude oil facing resistance around $76 per barrel and finding support around $73.8. 

In the evening, crude oil surged after Reuters reported that Saudi Arabia would voluntarily extend production cuts until the end of December 2024.  

WTI crude oil briefly rose to $76 per barrel and Brent crude oil approached the $80 per barrel level before giving back all the gains due to the false news. WTI crude oil closed 1.53% at $74.08 per barrel, while Brent crude oil closed 1.47% at $78.37 per barrel. 

Oil prices remained under pressure near the $76 level yesterday. During the Asian and European sessions, they faced resistance around $75 and continued to decline.  

In the afternoon, they further dropped to the $74 level. Oil prices quickly rebounded to near $76, but failed to sustain the upward momentum and broke below the previous low. Ultimately, they closed near the $74 level in the evening. 

Technical Analysis: 

Today’s trading strategy suggests focusing on buying on pullbacks, with selling on rebounds as a secondary approach.  

• Key resistance levels to watch in the short term are around 75.5-76.0. 
• Key support levels to monitor in the short term are around 73.4-74.0. 

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