Gold
On Monday, intensified fears of a US recession led to a global stock market crash, impacting the gold market as well, with prices dropping over 1%. Spot gold plummeted during the European session, hitting a daily low of $2364.29, down nearly $100 from the day’s high, before recovering above $2400 and closing 1.33% lower at $2409.32 per ounce.
US stocks fell sharply on Monday, with the Nasdaq and S&P 500 indices dropping at least 3% each, continuing last week’s sell-off due to recession fears.
Apple’s stock also tumbled after news of a major investor reducing their holdings. However, data showed that US service sector activity rebounded in July from a four-year low, with increases in orders and employment. This helped major indices recover some of their losses.
Gold found support near the 55-day moving average, and after the data release, it followed stocks in rebounding. The market continues to expect the Federal Reserve to cut rates in September, with increasing speculation of a 50-basis-point cut, supporting gold prices.
Gold Technical Analysis:
Yesterday, gold experienced significant volatility, with wide swings between highs and lows. During the European session, prices quickly dropped below $2420, reaching the previous Friday’s non-farm payrolls low of $2413, before recovering.
In the afternoon, it stabilized above $2420, rebounded strongly, and surged to $2458 before falling back. By the US session, prices had dropped below $2400, reaching $2364 before rebounding to close above $2400.
Today’s Focus:
- Short-term strategy: Favor buying on dips and shorting on rebounds.
- Resistance: $2425-$2435
- Support: $2385-$2375
Oil
On Monday, oil prices experienced volatility, falling as global stock markets continued to sell off, but the decline was limited by concerns over potential broader conflict in the Middle East.
WTI crude pared most of its losses during the US session, closing down 0.24% at $74.52 per barrel, while Brent crude closed down 0.22% at $77.13 per barrel.
The sharp drop in oil prices was primarily due to fears that the US, the world’s largest oil consumer, might enter a recession. Weak global economic data exacerbated concerns about sluggish fuel demand.
Last week’s US jobs report showed fewer-than-expected new jobs, and manufacturing sectors in the US, China, and Europe continued to face challenges.
OPEC+ recently decided to maintain plans to gradually phase out voluntary production cuts starting in October, further pressuring oil prices. This move indicates an increase in supply later this year despite current market weakness. A Reuters survey indicated that OPEC’s oil production rose in July, despite the group’s production cuts.
Oil Technical Analysis:
Yesterday, oil prices initially fell before rebounding, with a significant recovery in the US session. During the European session, prices dropped below $74, hitting $71.6 before recovering. In the US session, prices rebounded above $73, continuing to rise to close strongly near $74.5.
Today’s Focus:
- Short-term strategy: Favor buying on dips and shorting on rebounds.
- Resistance: $76.0-$77.0
- Support: $72.7-$71.7
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Disclaimer
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
The above strategies reflect only the analysts’ opinions and are for reference only. They should not be used or considered as the basis for any trading decisions or as an invitation to engage in any transaction. Doo Prime does not guarantee the accuracy or completeness of this report and assumes no responsibility for any losses resulting from the use of this report. Do not rely on this report to replace your independent judgment. The market is risky, and investments should be made with caution.
