Oil eyes Autumn highs
Oil prices are rebounding higher again on Tuesday, up more than 1%, and with sights seemingly set on the late autumn highs. We saw some heat come out of the market over the last couple of days but pullbacks were always likely to be limited given the broader dynamics.
Of course, omicron offers some demand uncertainty over the coming months but the market is tight as OPEC+ slowly turns the taps back on. And OPEC struggling to deliver on targets doesn’t help alleviate any of that tightness in the market. Prices could remain elevated for some time yet.
Can gold mount a rally as yields rise?
Gold has shown remarkable resilience in the current environment of rising rate expectations and higher yields, to such an extent that it makes me really question whether it can in fact rally in the short-term. There doesn’t appear much rationale behind the move unless we see weakness in the dollar but it’s impossible to ignore price action.
And the yellow metal is continuing to force the move higher, pushing strongly against the USD 1,800 barrier to the upside with some short-term success before being pushed back. Today it’s rallied as high as USD 1,810 and has once again been driven back but it’s holding above USD 1,800. A close above here could be a bullish signal, albeit a confusing one.
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