Oil rallies after strong US numbers
Oil prices rallied after another round of impressive US economic data boosted optimism for an improving crude demand outlook. The US economy still looks good and China’s economy could be ready to bounce back fairly soon. Momentum from yesterday’s bullish EIA crude oil inventory still lingers, but technical resistance at the $90 a barrel level is capping WTI’s rally for now.
OPEC Secretary General Al Ghais reminded energy traders that OPEC could be in a position to cut production if needed. OPEC is not going to let this pullback with oil prices continue much further.
Gold is locked up in battle with King Dollar. The US dollar might continue to strengthen if US economic data continues to surpass expectations. After breaking below $1800, gold has been struggling to regain its footing. Aggressive rate hikes globally, today from the Philippines and Norway, are keeping the pressure on non-interest-bearing gold.
Gold looks like it could be forming a trading range between $1750 and $1800 as investors will slowly refrain from massive positioning until we get beyond the Jackson Hole Symposium. Jackson Hole might not trigger any major surprises as the Fed seems locked into its data-dependency mode.
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