Gold prices remained steady on Tuesday as US Producer Price Index (PPI) data bolstered hopes for a September rate cut by the Federal Reserve. A weaker dollar and lower bond yields, coupled with ongoing geopolitical concerns, provided support to gold, despite some profit-taking. The price hovered near the record highs set in July.
In contrast, oil prices fell due to concerns over potential oversupply outweighing fears of escalating Middle East tensions. The IEA’s monthly report downgraded demand forecasts for 2025, and after encountering resistance at the 100-day moving average, some traders took profits. Market focus now shifts to the US July CPI data on Wednesday and retail sales figures on Thursday.
Gold
On Tuesday, gold prices remained steady as US PPI data reinforced expectations for a September rate cut by the Federal Reserve. A weaker dollar and lower bond yields, along with heightened geopolitical concerns, supported gold.
Despite some profit-taking, prices hovered near the record highs set in July. Spot gold remained stable near its all-time high, closing down 0.29% at $2,465.06 per ounce.
The US Dollar Index fell by 0.4% on Tuesday, making gold more attractive to holders of other currencies, while the 10-year US Treasury yield dropped to a one-week low. Traders are now looking ahead to the release of the US July Consumer Price Index (CPI) data on Wednesday and retail sales data on Thursday, which could provide further guidance for the Federal Reserve’s next policy move.
Gold Technical Analysis:
In technical trading, gold prices fluctuated around the $2,458-60 level before briefly spiking to $2,475, only to retreat and close at $2,465, forming a small bearish candle. Overall, the price remained in a strong consolidation above $2,458.
Today’s Focus:
For today’s short-term trading strategy, consider buying on dips and selling on rallies.
- Resistance: $2,478-$2,483
- Support: $2,455-$2,450
Oil
On Tuesday, oil prices fell as concerns over potential oversupply outweighed fears of escalating Middle East tensions. The IEA’s monthly report downgraded its 2025 demand forecast, and after encountering resistance at the 100-day moving average, some traders took profits. WTI crude closed down 1.25% at $78.58 per barrel, while Brent crude fell 1.29% to $80.94 per barrel.
While escalating tensions in the Middle East could threaten oil supplies from a key production region, the likelihood of a broader conflict seemed low as Iran hinted at resuming ceasefire talks with Hamas to avoid retaliation.
On the demand side, the International Energy Agency (IEA) maintained its 2024 global oil demand growth forecast but revised down its 2025 outlook, citing sluggish consumption in major Asian economies affecting growth.
The latest API data showed a significant drop in US crude inventories by 5.205 million barrels, with gasoline stocks down by 3.689 million barrels, both far exceeding market expectations, potentially supporting oil prices. Investors will be watching for the official EIA inventory data release later today.
Oil Technical Analysis:
In technical trading, oil prices struggled to break through the $80 level, leading to a pullback and further consolidation. The European session saw prices fluctuate near $80 before moving lower. During the US session, prices fell below $79, reaching $78 before stabilizing.
Today’s Focus:
For today’s trading strategy, consider buying on dips and selling on rallies.
- Resistance: $80.0-$80.5
- Support: $78.0-$77.5
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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.
