Oil’s big week, gold declines

Oil gains driven by OPEC+

Crude prices held onto the majority of this week’s OPEC+ driven gains after the NFP report showed the labor market remains strong but is showing signs of cooling. A strong dollar is eating away at some crude’s weekly gains, but that won’t have a lasting impact. ​

OPEC+ showed their cards this week and that will keep oil markets very tight as we approach winter. ​ OPEC+ has done whatever it takes and is now awaiting to see what the reaction will be from world leaders. The risks of $100 oil are easily back on the table and if it is a cold winter, we could see $110 before the end of the year. ​

Gold

Gold prices edged lower after a solid NFP report kept aggressive tightening by the Fed on the table. ​ Gold could be vulnerable leading up to next week’s inflation data as Wall Street wanted to see a much cooler NFP report today. ​ The economy is not breaking down as fast as some traders were anticipating. ​ If next week’s inflation does not deliver any cool surprises, a Fed pivot seems far away. Massive positioning might wait till Thursday’s inflation report, but until then, gold is vulnerable to a further slide towards the $1680 level. ​ ​

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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