Trading Insights: Gold & oil prices under pressure

Market Talk

Commentary:

Gold has lost around $33 from its five day highs. This could imply that traders are not convinced that the USD will weaken further and that the recent strong stock market performance decreases demand for gold as a “safe haven” following the increased investor risk appetite.

Gold current price is around $1,952 with a five day high of $1,985.

Also, the weaker gold price could indicate that traders believe that both the Fed, the ECB, and perhaps other central banks could be wrong on inflation in that the risk of inflation popping higher in the future remains a risk despite the latest inflation data signaling that inflation is slowing.

Gold price remains bearish below the $1,985 resistance level

Source: TradingView June 20 2023 as of 7.11 UTC

Trading Ideas for Gold Traders:

• Gold short sellers could be aiming for Gold price to fall another $50 toward the $1,900 area
• Gold buyers could be speculating that price will move back above the $1,985 resistance level and open the prospects for a retest of the $2,000s - $2,070s.

---

Today’s economic calendar

US Housing Starts

• Expected to report 1.384 million new house starts during May
• Housing Starts are a key indicator since it measures the number of new home construction projects that have started in the previous month.

AUD/USD falls lower after the Reserve Bank of Australia (RBA) minutes were released

• Signs that the RBA is near the end of its rate hiking cycle add to the downside pressure for the AUD/USD

Source: TradingView / J. Knobel June 20 2023 6:35 UTC

---

Upcoming events

Tomorrow (Wednesday 21 June 2023)

• UK inflation rate
• US Fed Chairman Testimony

Thursday 22 June 2023

• Bank of England interest rate decision
• Day 2 US Fed Chairman Testimony

---

Commentary & insights

Brent Crude Oil downside risk remains despite the recent gains

• China had been buying record amounts of Russian Oil during the last month according to China customs data.
• Brent Crude oil prices have advanced around +6% during the last 5 days on fears that crude oil supplies may face supply disruptions.
• Provided that fear fades away the prospects for Crude oil to resume its multi-month decline remains on the table

Trading Ideas for Brent Crude Traders:

• Brent Crude Oil short sellers could be aiming for Brent price to fall another $4.8 toward the $71.5 area
• Brent Crude Oil buyers could be speculating that price will move back above the $78.5 resistance level and open the prospects for an extension toward the $80 round number.