Crude Oil Prices May See Clashing Cues in Eurozone PMI, EIA Data

CRUDE OIL & GOLD TALKING POINTS:

• Crude oil prices edge up as risk appetite firms in Wall St. trade

• Eurozone PMI, EIA inventories data may offer divergence cues

• Gold prices vulnerable as US Dollar attracts liquidity demand

The chipper move translated into higher bond yields. The US Dollar had been trending higher since the prior day, and an upshift in rates-based support certainly didnt hurt. Taken together, that understandably eroded support for non-interest-bearing and anti-fiat assets to the detriment of gold prices.

Crude Oil Prices May See Clashing Cues in Eurozone PMI, EIA Data

Looking ahead, a downbeat set of Eurozone PMI figures might pull the spotlight back to the broader slowdown in global growth, souring sentiment and nudging oil back downward. Losses might be capped if EIA inventory data – where a 4.4-million-barrel drawdown is expected – registers closer to yesterdays API projection calling for a mammoth 10.96-million-barrel drop.

As for gold, a risk-off shift in the markets mood might see lower bond yields competing for influence with a US Dollar buoyed by liquidity demand. If scope for pricing in further Fed easing is as exhausted as it seems, the Greenback might prevail and pressure the yellow metal downward.

Get the latest crude oil and gold forecasts to see what will drive prices in the third quarter!

GOLD TECHNICAL ANALYSIS

Gold prices are probing lower after putting in a Bearish Engulfing candlestick pattern. Negative RSI divergence bolsters the case for a downside scenario. A daily close below trend line support at 1406.62 exposes the July 1 low at 1381.91. Alternatively, an upturn through resistance marked by the 38.2% Fibonacci expansion at 1447.89 targets the 50% level at 1468.27.

CRUDE OIL TECHNICAL ANALYSIS

Crude oil prices are digesting losses above support at 54.84, with a modest bounce retracing a bit of recently lost ground. Immediate resistance is capped at 58.19, with a break above that opening the door to retest the 60.04-84 area. Renewed selling pressure that pierces support probably targets the 49.41-50.60 zone next.

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