Oil struggles, gold’s great start


Oil prices are tumbling as risk aversion sends the dollar higher and dampens expectations that the crude demand outlook will improve anytime soon. ​ China’s reopening has too many question marks as hospitals are overwhelmed and medical supplies run low.

Crude prices could struggle here as a strong dollar could be here to stay as investors can’t pass up the yield they are getting in fixed income. ​ Manufacturing activity globally mostly appears to be stuck in contraction territory and that might not improve until the end of the quarter.


Gold is riding a nice wave of falling Treasury yields, safe-haven flows as recession risks rise, and an improving outlook for jewelry demand across China and India. ​ Gold should have a strong start to the New Year as much of Wall Street goes defensive. ​ The precious metal should see strong inflows as stock market sellers appear to be clearly in control.

Inflation might prove to be harder to bring down and that should keep the risks elevated that the recession that hits the US economy could be harsher than what most are anticipating. ​ The Fed will remain loud and clear that a lot of work remains to bring down inflation.

Gold has massive resistance at the $1900 level, but it could be tested by the end of the quarter. ​

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023. 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. Prior to OANDA 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, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.