Can WTI break $70?

Oil prices are slipping once more in volatile trade. There are so many driving forces in the oil market at the moment and a more sombre economic outlook on the back of the hawkish central bank message this week appears to be the dominant one going into the weekend.

The interesting thing for me remains how prices respond to the December lows, should they be tested again, with the level in WTI also representing the point at which the White House has indicated it will start refilling the SPR. We’ll see how much of a floor that puts in the price but in the short term it could at least offer some support.

A correction on the cards?

It hasn’t been the best week in the end for gold, which appeared to be on the brink of a very bullish breakout following the US inflation data on Tuesday. The Fed appeared to put an end to those hopes in the near term and a wave of risk-aversion towards the back end of the week has boosted the dollar and yields, further weighing on the yellow metal.

With momentum already waning in the run-up to this week’s events, we could be looking at some exhaustion combined with the hawkish commentary to drive a correction. It’s seen some support around $1,770-1,780 over the last day or so, with the next key level falling around $1,760 and then $1,730.

For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.

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• Source: https://www.marketpulse.com/20221216/oil-under-pressure-fed-weighs-on-gold/