Oil flat, gold hits key resistance

Oil treading water

Oil prices are basically flat on Tuesday, sitting a little below the middle of their recent trading ranges as traders continue to weigh up the global economic outlook, OPEC+ production risks, and China's Covid approach.

Prices remain choppy and that's likely to remain the case given the ongoing uncertainty around these key areas. Everyone became much more optimistic around the US after last week's inflation report but that appears to have quickly faded. Enormous downside risks remain around the global economy next year even if the Fed does pause its tightening a little sooner and perhaps that reality is kicking in again.

Gold rally stalls at key resistance level

The great gold recovery has stalled, with the yellow metal only slightly higher on the day after dipping a little earlier in the session. That follows a similar pattern to Monday and could be viewed as a positive sign given the reluctance to allow the recent rally to retrace in any considerable way.

It has been a very impressive recovery though, up around 10% from the lows earlier this month, so a corrective move wouldn't come as a surprise. It's seeing resistance around $1,780 at the moment, a level that was a major area of support earlier in the year and again in May before finally crumbling in early July. A move above here would be a significant technical breakout.

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