Oil survives scare, gold consolidates

Oil survives inventory scare

Oil is getting more love today, with WTI moving back above $70 a barrel .

Monday’s growth fears were seemingly overdone and a move above $70, should it close there, could be a very bullish signal. A move back above here takes out previous support and overcomes a potential psychological barrier.

The EIA inventory report initially sent prices lower but they rebounded quickly, with fuel demand still seemingly very strong and risk appetite providing further support.

Delta poses a clear risk to the near-term outlook as countries re-impose restrictions or maintain them for longer but as we’ve seen throughout, OPEC+ is ready to be flexible as and when it’s necessary.

Gold consolidating around $1,800

Gold is hovering back around $1,800, with the improvement in risk appetite and higher US yields weighing. The dollar is trading a little lower after making small gains earlier on the back of those higher yields.

The yellow metal has been consolidating around these levels for the last couple of weeks and, despite some activity at times, nothing much has changed.

We seem to have entered a wait-and-see phase in a number of different assets and wouldn’t be surprised to see it continue for much of the summer.

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 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.
Craig Erlam
Craig Erlam

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