Fed bolsters oil, gold, bitcoin breaks 20K

Oil pushes on but major resistance ahead

Oil prices are continuing to make steady gains, with the latest boost coming from the Fed’s upbeat economic assessment and the surprise inventory draw on Wednesday. The rally continues to look like it’s low on fuel though and with WTI closing in on historic support and resistance around the USD49-USD50 mark, I wonder whether we’re already seeing some profit-taking, which may continue into the end of the year. OPEC+ has made its move; now it’s time to wait and see how the next couple of months of the virus unfolds.

Gold buoyed by Fed

Gold prices were surprisingly buoyed by the Fed announcement, despite the lack of new action. The commitment to a longer period of purchases appears to have done the trick, with the yellow metal back around last week’s highs and looking far more promising once again. The dollar index breaking below 90 and languishing at two and a half year lows isn’t doing gold any harm either. We may not scale the heights it hit earlier this summer but gold may have its sights set on USD2,000 once again.

Bitcoin smashes through USD20,000

Bitcoin has got its mojo back after breaking USD20,000. It may have taken its time after coming close late last month but it’s broken it in typical bitcoin fashion. It’s smashed through into new territory and exploded higher, adding more than 16% since yesterday. The question now is where will it stop? These are extraordinary gains in such a short period of time and bitcoin has a history of doing well amidst the hype. Can USD30,000 be on the cards by Christmas? Why not.

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.

Craig Erlam

Craig Erlam

Senior Market Analyst - UK & EMEA at OANDA
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 BNN. 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.
Craig Erlam
Craig Erlam

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