CRUDE OIL & GOLD TALKING POINTS:
Speculation about US monetary policy continues to be the dominant driver for commodities prices. A disappointing service-sector ISM print was cheered, with traders probably hoping that it will foreshadow a slower tighteningpath.
An upswing in risk appetite pulled crude oil prices higher alongside the bellwether S&P 500[1] stock index. Meanwhile, the US Dollar fell alongside front-end Treasury bond yields. Gold prices had been on the path to recovery earlier in the session and managed to hold on to most of them despite volatility at the close.
ALL EYES ON US JOBS DATA
The spotlight now turns to April’s US employment report, which is expected to show that job creation accelerated while wage inflation held at a firm 2.7 percent on year. Anything shy of a dramatic deviation may open the door for profit-taking on recent moves[2], with the greenback retreating as commodities rise.
See our quarterly crude oil price forecast[3] to learn what will drive the trend through mid-year!
GOLD TECHNICAL ANALYSIS
Gold prices corrected cautiously higher. A daily close above former support at 1323.60 exposes the next upside barrier at 1333.42. Alternatively, a move below the 1302.97-08.65 (March 1 low, 23.6% Fibonacci retracement) exposes the 1273.14-82.84 zone (38.2% level, trend line from December 2016).
CRUDE OIL TECHNICAL ANALYSIS
Crude oil prices continue to oscillate in a range below the $70/bbl figure. A move =below support at 67.36 exposes former resistance at 66.22. Alternatively, a daily close above the April 19 high at 69.53taregts the 38.2% Fibonacci expansion at 71.24 next.
COMMODITY TRADING RESOURCES
--- Written by Ilya Spivak, Currency Strategist
