Oil pares gains
It's been another volatile couple of days for oil, with Biden's seemingly unsuccessful trip to the Middle East very much stealing the spotlight. Traders continue to weigh up tight supplies against recession prospects which have brought the price back to a suddenly more reasonable USD 100 a barrel.
We could see it slip further if economic prospects continue to deteriorate, or if Saudi Arabia hints at turning on the taps faster. The former is possible, but the latter still looks unlikely. Traders will be keenly awaiting the next OPEC+ meeting in a couple of weeks.
Is gold about to break USD 1,700?
Gold is struggling today even as the dollar falls around two-thirds of one percent. The prospect of it breaking away from USD 1,700 to the upside is looking increasingly slim if it can't even do so when the dollar has fallen more than 2.5% from its highs over the last few sessions. Yields not sliding alongside that may be responsible.
A break below USD 1,700 could be a big move but I still believe USD 1,680 may be bigger given how important a level of support it's been in the past. It will be interesting to see how the momentum holds up around those levels.
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