Gold Prices Erase Syria-Linked Gains on Fed Rate Hike Bets
Gold prices erase Syria-linked gains after US payrolls data
Crude oil prices hit 1-month high on supply disruption fears
Fed Chair Woman Jannet Yellen speech, G7 meeting in the spotlight ahead
Gold prices retreated from highs set in the wake of the surprise US missile strike on Syria as the March set of US employment figures stoked Fed rate hike speculation. The metal’s drop tracked inversely of a jump in Treasury bond yields and a steepening in the 2017 rates path implied in Fed Funds futures.
While the headline payrolls gain was far smaller than economists expected, the jobless rate fell even as labor force participation held steady and wage inflation remained near eight-year highs. On balance, investors seemed to read that as signaling the approach of so-called “full employment” rather than something worrisome.
Crude oil prices continued to push higher as the deteriorating geopolitical backdrop fed fears about regional supply disruption. The WTI benchmark touched the highest level in a month even as Baker Hughes reported that the number of active US oil rigs hit the highest level since August 2015.
GOLD TECHNICAL ANALYSIS – Gold prices conspicuously recoiled from trend-defining resistance in the 1263.87-65.66 area (February swing high, trend line, 50% Fibonacci expansion). A turn lower from here that breaches the 1241.20-49.01 area (former resistance, 38.2% Fib) exposes 1218.90, an inflection point in play since mid-January. Alternatively, a push through resistance confirmed on a daily closing basis initially targets the 61.8% level at 1282.31.
CRUDE OIL TECHNICAL ANALYSIS – Crude oil prices look poised to continue higher after closing above resistance at 52.04, the 38.2%Fibonacci expansion. The next upside barrier comes in at 53.57, the 50% level, with a further push beyond that exposing the 55.10-21 area (January 3 high, 61.8% Fib). Alternatively, a turn back below 50.04 paves the way for a retest of the 23.6% expansion at 50.14.
Oil slides more after U.S. settlement on API inventory report
Oil prices fell on Tuesday, then slid more in post-settlement trade after an industry group reported that U.S. crude stockpiles fell less than expected in the latest week while gasoline stockpiles grew unseasonably. Click here for more