Gold Prices Climb Approaching 2400 Mark Again, Oil Prices Bottom Out and Rebound

Despite the rise in the US dollar and US Treasury yields following stronger-than-expected US March retail sales data, aided by safe-haven demand driven by tensions in the Middle East, gold prices climbed 1.64%, once again approaching the 2400 level.

Iran’s weekend attack on Israel proved to be less destructive than expected, easing concerns about a reduction in crude oil supply, with US crude oil briefly hitting a near two-week low, but as Israel announced it would respond to Iran’s weekend missile and drone attacks, oil prices bottomed out and rebounded.

Gold >>

On Monday, following the release of stronger-than-expected US March retail sales data, the US dollar and US Treasury yields rose.

Driven by safe-haven demand amid tensions in the Middle East, spot gold opened higher with a gap, with the US session rising above USD 2380 per ounce, rebounding over USD 50 from the daily low, and ultimately closing up 1.66% at USD 2383.19 per ounce.

Iran launched a series of explosive drones and missiles against Israel on Saturday night, marking the first such attack by another country against Israel in over thirty years, sparking concerns about the emergence of a wider regional conflict.

However, as most missiles and drones were intercepted and did not cause significant damage, and with persuasion from various parties, market concerns did not escalate further. After the release of strong US retail sales data, gold prices briefly fell to USD 2324.22 per ounce.

But with further statements from Israel, gold prices once again found support from safe-haven buying and bargain hunting. Market attention is now focused on this week’s data releases and speeches by Federal Reserve officials.

Yesterday, technically speaking, gold prices in the Asian and European sessions were under slight pressure near the 2372 level, experiencing consolidation under resistance. In the afternoon European session and the late US session, there were several attempts at a rebound but all were capped below the 2365 level, resulting in oscillations and declines.

However, after 22:00, gold prices rapidly fell below the 2330 level, reaching near 2324 before swiftly rebounding, forming a “V” shape bottom and rising strongly in the early morning, breaking above 2370 and accelerating to close above the 2391 level with strength.

Technical Analysis:

Today’s short-term strategy for gold suggests prioritizing short positions during rebounds, with long positions considered as a secondary approach during pullbacks.

  • Key resistance levels to watch in the short term are around 2400-2410.
  • Key support levels to watch in the short term are around 2354-2360.

WTI Crude Oil >>  

On Monday, Iran’s weekend attack on Israel was proven to be less destructive than expected, easing concerns about a reduction in crude oil supply. US crude oil briefly fell to a near two-week low, but with Israel’s declaration of a response to Iran’s weekend missile and drone attacks, oil prices bottomed out and rebounded.

WTI crude oil fell nearly 2% intraday before rebounding, ultimately closing up 0.23% at USD 85.6 per barrel; Brent crude oil closed up 0.22% at USD 90.35 per barrel. The initial response of the crude oil market to Iran’s drone and missile attack on Israel was quite subdued, with little price movement in major crude oil futures contracts.

The Iranian attack on Israel heralds a significant escalation in the Middle East conflict, and oil prices would typically rise due to concerns about potential supply disruptions. However, oil prices showed mild movements during the Asian session, with little change in global benchmark Brent crude oil futures and US West Texas Intermediate crude oil futures.

The current signals from the market suggest relatively low risks of a major escalation in the situation and retaliatory strikes from Israel. Yesterday, oil prices experienced a technical rebound after initially declining, closing higher after probing lower levels.

Prices fell slightly during the Asian and European sessions, dipping below the USD 84.3 level before stabilizing and rebounding. In the late US session, there was a second rebound attempt but was capped around the USD 85.3 level, leading to a decline below the USD 84 level before another strong rebound.

In the early morning, oil prices accelerated higher, breaking above and staying above the opening gap around the USD 85.5 level, continuing the upward trend. Ultimately, prices closed near the intraday high at USD 85.9 per barrel.

Technical Analysis:

Today’s crude oil trading strategy suggests prioritizing short positions during rebounds, with long positions considered as a secondary approach during pullbacks

  • Key resistance levels to monitor in the short term are around 87.0-87.5.
  • Key support levels to monitor in the short term are around 84.5-84.0.

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