Can oil break above the five-month range after OPEC+ cut?
Oil is continuing to tread water around the five-month highs, an area it has failed to surpass in the aftermath of the latest OPEC+ output cut. Rather than propel the price towards $100 as some feared (it could still happen, of course), the decision appears to have just moved the price back to previous ranges that the cartel was seemingly comfortable with.
The next step may depend on global growth and whether the economy can weather the recent storm, particularly in the US where tighter credit could significantly weigh on growth for the rest of the year. For now, $88 still looks like an interesting level of resistance in Brent, with $83.50 potentially one to watch below after the gap open a couple of weeks ago.
Gold fails to hit new highs for now
Gold is trading around $2,000 this morning after giving back some gains in recent sessions. The yellow metal came close to record highs late last week but didn’t quite have the legs to properly test it. That may still come but it seems we’re now seeing some profit-taking, which is coinciding with yields creeping higher and interest rate expectations doing similar. Markets still haven’t fully recovered from the banking turmoil, especially in the US, and that could continue to support gold if investors remain of the view that the scarring from the crisis will lead to tighter credit conditions.