Oil and gold keep eye on FOMC meeting

Asian oil markets trade sideways ahead of the FOMC

News that OPEC compliance had reached 164%, i.e., they can’t even pump the quotas they have agreed, failed to lift oil markets in Asia. Oil prices are almost unchanged thanks to a mainland China and Japan holiday today. Overnight, oil continued its noisy range-trading, awaiting direction from Russia/Ukraine, EU/Russia oil sanctions, or a slowdown/or not from China. Brent crude fell 1.60% to USD 105.80, and WTI fell by 1.35% to USD 103.50 a barrel. In Asia, moribund trading sees Brent crude and WTI unchanged.

Brent crude remains well supported on dips to USD 100.00 a barrel, with resistance at USD 110.00. WTI is trading in a noisy USD 100.00 to USD 108.00 range. In the bigger picture, Brent crude is still in a broader USD 100.00 to USD 120.00 range and WTI in a USD 95.00 to USD 115.00 range. Only a weekly close above or below those levels signals a new directional move.

Gold markets trade sideways ahead of the FOMC

Gold traded in a USD 30 dollar range overnight between USD 1850.00 and USD 1880.00 an ounce, moving inversely to the US dollar’s intra-day moves. It crept to a 0.27% gain to USD 1868.00 an ounce by the New York close. In Asia, holidays and the FOMC meeting are impacting volatility as well, gold edging slightly lower to USD 1866.00 in directionless trading.

Like everything else, the FOMC statement will determine gold’s near-term direction unless the decision is either a 0.25% or 0.75% hike. From a technical perspective, gold still looks vulnerable and is relying on US dollar falls tonight to steady the ship. It has been unable to regain the USD 1880.00 an ounce region, which is also its 100-day moving average (DMA). Support lies at USD 1850.00 and then the tip of the breakout triangle at USD 1835.00.

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Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was OANDA’s Senior Market Analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV and Channel News Asia as well as in leading print publications such as The New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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