Market Recap
On Thursday, the US dollar soared past 107 as Trump’s tariff schedule became clearer, putting pressure on gold. The metal dropped over $50 from its daily high, closing down more than 1% at $2,876.99 per ounce. Meanwhile, crude oil rebounded over 2%, with WTI crude futures climbing back above $70 per barrel, driven by Trump’s decision to revoke Chevron’s license in Venezuela and OPEC+ production policies.
Gold Overview
- Gold faced heavy selling pressure on Thursday as the U.S. dollar surged 0.74% to 107.28, its biggest one-day jump this year. Trump confirmed that 25% tariffs on Mexican and Canadian goods would take effect on March 4, fueling market uncertainty.
- Economic data weighed on gold as U.S. durable goods orders rose 3.1%, beating the 2% forecast, reducing expectations for Fed rate cuts. Cleveland Fed President Beth Hammack signaled that the Fed may pause rate adjustments for now.
- Geopolitical developments: U.S.-Russia talks in Istanbul ended after 6.5 hours, while Ukraine’s President Zelensky is expected to visit Washington on February 28 to sign a mineral resources deal with Trump.
- Investors await the PCE Price Index, the Fed’s preferred inflation gauge, for signs of persistent inflation. Analysts forecast a 0.3% monthly increase after a hotter-than-expected CPI report raised market concerns.
Gold – Technical Outlook
Gold fell below $2,900, testing a low of $2,867.95, before stabilizing around $2,876.99. The price is showing signs of continued downside pressure after failing to hold above $2,950 resistance.
- Key Resistance: $2,890 – $2,895
- Key Support: $2,860 – $2,855
Oil Overview
- Crude oil rebounded sharply, rising over 2% as Trump revoked Chevron’s license to operate in Venezuela. Chevron exports 240,000 barrels per day, over 25% of Venezuela’s total oil production.
- Tariff impact: Trump’s confirmation that tariffs on Mexican and Canadian imports will proceed also supported oil prices. The U.S. imports 4 million barrels/day from Canada and 400,000 from Mexico, and tariffs could disrupt this flow.
- OPEC+ production uncertainty: Russia and the UAE support an April production hike, but Saudi Arabia and other producers favor a delay amid global economic concerns. Morgan Stanley analysts predict OPEC+ may push back production hikes to late 2025.
Oil – Technical Outlook
WTI crude bounced from $68.6, reclaiming the $70 level. While a short-term rebound is in play, oil remains below the 10-day and 20-day moving averages, keeping the broader trend bearish.
- Key Resistance: $70.0 – $70.5
- Key Support: $68.0 – $67.5
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