Commodities and Cryptos: Oil won’t stop rising, Gold falls, Bitcoin higher

Oil

Brent crude prices breached the $90 level, the highest level since 2014, joining a broad risk-on Wall Street move and shrugging off a somewhat bearish EIA crude oil inventory report.  Energy traders are anticipating higher energy prices on potential geopolitical risks and as OPEC+ will stick to their plan to deliver another modest increase to production at next week’s meeting.

Oil inventories posted a larger build than expected, jet fuel demand plunged, gasoline imports dropped, demand improved slightly. Cold weather was behind the strong demand for heat.

Crude production dropped again, but that was mainly due to cold weather and so far, earnings season from the oil giants suggest that will change going forward.

Crude prices did not have much of a reaction post-Fed, settling slightly lower off session highs.

Gold

Gold prices tumbled as equities roared back. The return of risk appetite dampened the appeal for safe-havens and that sent gold back to the middle of its recent trading range.  Just when gold looked like it was going to breakout, they pull it back in.  The path higher for gold is there, but it will likely be a tough grind higher.

Gold held onto losses after the FOMC statement laid out their plans for a March rate increase. Powell’s hawkish press conference sent gold to fresh lows as the Fed laid out the possibility of a much more aggressive balance sheet reduction and refused to rule out the potential of having an interest rate hike at each policy meeting.

Bitcoin

Calm is entering crypto markets as panic-selling of risky assets appears to be over now that the Fed has calmed markets.  Bitcoin has steadied this week and optimism is brewing in the cryptoverse that a strong altcoin season could be coming if Bitcoin can stabilize between the $40,000 and $50,000 trading range.

The regulatory hurdles however will remain a constant headwind for crypto markets.  The crackdown on crypto companies that offer high-yield products appears to be heating up as the SEC may be closing in on Celsius Network, Voyager Digital, and Gemini Trust Co. Many crypto traders have relied on these crypto lending products any disruption in this space could impact many coins.

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.

Ed Moya

Ed Moya

Senior Market Analyst, The Americas at OANDA
With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.
Ed Moya