The U.S. Dollar Index fell on Tuesday, as strong U.S. data dragged down gold prices, reversing their earlier gains. Oil prices also experienced a drop of over 2% due to concerns over interest rate hikes and excess supply.  

This week, the focus will be on upcoming speeches by Federal Reserve Chair Powell and the release of EIA crude oil inventory data. 

Gold>>

On Tuesday, spot gold opened higher and experienced volatility, finding support at the 10-day moving average. However, the price reversed its upward trend after the release of strong U.S. economic data.  

In June, gold has already declined by approximately 2.6%, indicating a potential second consecutive monthly decline. 

Investors adopted a cautious stance following hawkish remarks from Federal Reserve officials. The market’s attention is now focused on the upcoming speeches by Fed Chairman Powell on Wednesday and Thursday, as they are expected to provide insights into future interest rate hikes. 

The price of gold has been fluctuating below $1942. Yesterday, it started the day at $1922.9 per ounce, reaching a daily high of $1931 per ounce before quickly retreating during the U.S. session due to fundamental pressures. The daily low touched $1910.6 per ounce, and it ultimately closed at $1913.6 per ounce.  

Yesterday’s price movement approached the lower range, raising the possibility of further downside today. 

Technical Analysis: 

Gold is currently bearish, prioritizing short-selling opportunities during rebounds, while considering low-level long positions as secondary strategies. 

• Resistance levels to monitor above are at $1921-1930. 
• Support levels to monitor below are at $1910-1900. 

WTI Crude Oil >>

Concerns about potential interest rate hikes by central banks worldwide have put Brent crude oil in a contango situation for the past two months, heightening worries about supply surplus. On Tuesday, oil prices slid over 2%, with investors focusing on the weekly EIA crude oil inventory data in the United States. 

According to the American Petroleum Institute (API), apart from distillate inventories increasing, both crude oil and gasoline inventories in the United States decreased.  

In the week ending June 23, crude oil inventories dropped by around 2.4 million barrels, while gasoline inventories declined by approximately 2.9 million barrels. 

Starting in May this year, multiple OPEC+ oil-producing countries initiated production cuts that will continue until 2024. Notably, Saudi Arabia, OPEC’s largest producer, plans to unilaterally reduce production by 1 million barrels per day in July, reaching around 9 million barrels per day.  

The market is intertwined with mixed bullish and bearish news, reflecting uncertain market conditions. Market focus remains on Thursday’s API crude oil inventory series data. 

In intraday trading, crude oil faced downward pressure after touching the $70 level, retracting to around $67.7. Currently, crude oil fundamentals appear relatively subdued.  

While there has been a minor rebound following the decline, the overall trend remains weak and volatile. 

Technical Analysis:

Crude oil is currently under bearish pressure, with a focus on short-selling opportunities during rebounds, while considering low-level long positions as secondary. 

• Resistance levels to monitor above are $68.8-69.4 per barrel. 
• Support levels to monitor below are $67.0-66.5 per barrel. 

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