Gold Prices Hold Steady, U.S. Crude Oil Closes Down 1.2%, Market Focus on U.S. Inflation Data

The gold price remains stable, and the market is awaiting guidance from U.S. CPI inflation data. Unexpectedly increased U.S. crude oil inventories are putting pressure on oil prices, with WTI crude oil closing down 1.2%.

Gold >>

On Wednesday, spot gold experienced an initial rise followed by a decline, closing at USD 2029.8 per ounce with a decrease of 0.16%. The price of gold futures remained relatively stable, hovering around USD 2033.30 per ounce.

During Wednesday evening, Bank of England Governor Bailey mentioned in his testimony on the semi-annual financial stability report that bringing the UK inflation rate back to the target level is an important task.

Meanwhile, the European Central Bank expects the 2% inflation target to be achieved in 2025. The European Central Bank is on the right track, but potential upward price risks still exist. Expectations of a rate cut have eased the financial market environment.

With the euro strengthening against the US dollar, the rebound of the US dollar index has narrowed, leading to a halt in the decline of gold prices. The market is patiently awaiting U.S. inflation data.

On the technical side, gold showed a mixed performance, dipping below the key level of 2023 during the Asian and European sessions before stabilizing and rebounding. In the afternoon European session, a strong V-shaped rebound brought the price back above 2035, continuing the bullish rebound trend.

However, in the late U.S. session, gold prices were suppressed below 2035, weakening and closing lower, breaking previous lows and ending on a bearish note.

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 2040-2045.
  • Key support levels to watch in the short term are around 2020-2015.

WTI Crude Oil >>

On Wednesday, WTI crude oil declined by 87 cents, closing at USD 71.37 per barrel, with a decrease of 1.20%. The intraday lowest point touched USD 70.12 per barrel. Brent crude reported USD 77.31 per barrel, reflecting a 1.21% decrease.

According to the Wednesday report from the U.S. Energy Information Administration (EIA), the U.S. crude oil inventories increased by 1.3 million barrels for the week ending on January 5.

Analysts surveyed by the S&P Global Commodity Futures indicated an average expectation of a 900,000 barrel decrease in U.S. crude oil inventories for the same week. On Tuesday, the American Petroleum Institute (API) forecasted a 5.2 million barrel decrease in U.S. crude oil inventories.

On the technical side, oil prices experienced an initial rise followed by a decline. During the Asian and European sessions, the price stabilized above the key level of USD 71.7, leading to a bullish fluctuation and breaking higher.

However, during the late U.S. session, there was a second attempt to surge above the USD 73.5 level, but it faced resistance and fell back, demonstrating a weak and oscillating downward trend, closing below the previous low.

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 74.0-75.0.
  • Key support levels to monitor in the short term are around 71.0-70.0.

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