Oil keeps rising, Gold awaits NFP

Oil

It is getting hard to bet against higher crude prices. ​ This week’s OPEC+ decision was a game changer for the oil market, as it signals tight conditions will remain throughout this winter. ​ Energy traders are not really believing that the Biden administration will be able to do anything quickly to stop the rally in oil prices.

The NOPEC bill seems like it has a lot of barriers and won’t be an immediate course of action. The SPR has been tapped already and the US is dangerously depleting inventories which could make them more dependent on OPEC in the future. Sanction relief for Venezuela won’t come easy and does not seem like a viable option right now. ​ ​

A strong dollar is capping crude’s gains today and it looks like we could see crude continue to consolidate until tomorrow’s NFP report. ​

Gold dips on hawkish Fed

Gold prices softened after another round of hawkish Fed speak. ​ Gold is entering consolidation mode as traders await nonfarm payrolls. ​ The lead up to NFP Friday saw a mixed round of employment readings that has many bullion investors on standby. A hot labor market and strong wages could keep the bond market selloff going and should decide what will be gold’s next major move.

If nonfarm payrolls does not deliver any major surprises, gold may still be stuck in a trading range between $1700 and $1740 as traders will wait for next week’s inflation report. ​

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Ed Moya

Senior Market Analyst, The Americas at OANDA

With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.