Gold
Amid heightened geopolitical uncertainty driven by the Russia-Ukraine conflict, surging risk-off sentiment, and a softer dollar retreating from its 14-month highs, gold rebounded sharply, breaking its six-day losing streak.
The precious metal surged approximately $50, reclaiming the $2,600 mark. As of the close, gold was up 1.91% at $2,611.61 per ounce.
- Russia-Ukraine Conflict: The Biden administration’s recent policy shift allowing Ukraine to strike deeper into Russia using US-made weapons has amplified geopolitical tensions. In response, Kremlin spokesperson Dmitry Peskov warned of “reckless and dangerous” consequences, heightening fears of broader conflict.
- Dollar Softens: The dollar index declined 0.44% to 106.20, marking its second consecutive daily drop. Last week, the dollar hit a 14-month high (107.07), supported by speculation that a potential Trump reelection could lead to higher tariffs and inflation, possibly slowing Federal Reserve rate cuts.
- Goldman Sachs Outlook: In its 2025 market forecast, Goldman Sachs identified gold as its top trade in commodities. The bank maintains a year-end target of $3,000 per ounce for 2025, citing structural central bank buying and cyclical support from expected Fed rate cuts.
Upcoming Data & Events:
Investors should watch for developments in the Russia-Ukraine conflict, US October building permits, and remarks by Kansas City Fed President Jeff Schmid on economic and monetary policy.
Gold Technical Analysis:
On the 4-hour chart, gold rebounded after testing lows at $2,536, ending its downward streak. The price reclaimed the lower Bollinger Band and shows signs of bullish continuation. The MACD indicator displays a bullish crossover, while short-term moving averages are starting to turn upward.
Today’s Focus:
- Key Resistance Levels: $2,622 – $2,627
- Key Support Levels: $2,600 – $2,595
Oil
Crude oil prices surged as concerns about supply disruptions in Europe and escalating geopolitical tensions between Russia and Ukraine fueled market sentiment. Both WTI and Brent crude posted gains exceeding 3%.
- European Supply Concerns: Norway’s largest oil field, Johan Sverdrup, temporarily shut down due to a power outage, tightening North Sea oil supplies, which underpin Brent futures. Analysts suggest this disruption could lead to short-term market tightening.
- Russia-Ukraine Tensions: Washington’s decision to permit Ukraine to use US-made weapons against Russia has escalated geopolitical risks. Analysts warn that such moves could destabilize the region further, providing additional support for oil prices.
- Contract Rollover Dynamics: Ahead of the expiration of December futures, traders are shifting focus to January contracts. The spread has flipped to contango, indicating traders anticipate higher prices in the near term.
Upcoming Data & Events:
Key items to monitor include the API inventory report (due Wednesday) and potential developments at the Johan Sverdrup oil field. Geopolitical updates from the Russia-Ukraine conflict will also play a critical role.
Oil Technical Analysis:
Oil prices rebounded after last week’s declines, but upside momentum remains capped at higher levels. The 4-hour chart indicates ongoing range-bound trading, with Bollinger Bands suggesting possible price consolidation. A break above the upper band could signal further gains.
Today’s Focus:
- Key Resistance Levels: $70.0 – $70.5
- Key Support Levels: $68.0 – $67.5
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Disclaimer
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
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