Oil sell-off highlights nervousness in economic outlook
Oil prices are a little lower on Wednesday, holding their losses from Tuesday when sharp selling kicked in around the open on Wall Street.
As many have repeatedly warned, the risks have remained to the downside for oil priced, with the economic outlook for the remainder of the year looking murkier by the day.
Yesterday we saw an example of the soft underbelly in the oil price recovery. The nervousness clearly showed as the sell-off gathered speed.
We’re obviously not heading back to the March/April scenario, OPEC+ will be determined to avoid anything like that, but rallies may continue to look a little weak.
Dollar rebound gives gold bulls hope
The rebound in the dollar this week has been supportive for gold, enabling it to rebound off the $1,850 level and cautiously head back towards $1,900.
This is where the real test will come. The dollar testing previous highs from above and gold testing prior major support from below. A break through $1,900 would undoubtedly give gold bulls hope but I’m not convinced. I think there may be a little more to go.
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