- Crude Oil
Oil prices inched upward in early trading during the European session on Monday, extending last week’s gain of over 4%. Both WTI and Brent rose to their highest levels since August 1 as Ukraine struck Russia’s energy infrastructure and the U.S. reported an unexpected drawdown in inventories. So far, oil markets have absorbed the additional barrels produced by OPEC. However, further gains could be capped if global supply rises. Iraq has resumed oil exports from Kurdistan after a 2.5-year halt, which could boost international supply by an estimated 190K barrels per day. Moreover, OPEC+ is expected to hike production again in November, exacerbating concerns about a supply glut. Nevertheless, barring Saudi Arabia, most OPEC member countries have reached their production ceilings, which means the planned October hike and potential November boost could end up being lower than previously announced.
Brent is up 0.11% at $68.83, testing a level of resistance from which it has retreated in recent weeks. A break above could take the commodity to $71.14, characterized by the late-July high. It has immediate support at $68.53 and its next support level is at $65.02. WTI is up 0.09% at $65.27, also testing resistance. It has support at $64.41 and $63.55, with the next resistance at $65.99.
- Gold
Gold is continuing its show of strength with a 0.28% higher close on Friday, followed by a massive 1.48% rally during the Asian session on Monday. With this move, the bullion has now crossed the $3,800 level, marking yet another record high this year.
The rally is being driven by heightened odds of further interest rate cuts later this year, especially after the Fed’s preferred inflation metric, the Core PCE Price Index, came in line with expectations at 2.9% on Friday. Additionally, increasing trade uncertainty from a fresh round of tariffs by Donald Trump on imported goods, such as drugs, trucks, and furniture, along with a risk of a US government shutdown, added to the safe-haven demand for the yellow metal. All eyes will be on the numerous speeches from Federal Reserve officials scheduled throughout the week, along with the highly anticipated non-farm payrolls report on Friday, both key factors expected to influence Gold prices in the days ahead.
On a technical front, prices have broken above the previous all-time highs of $3,791.25 touched on 23rd September and are trading near the $3,815 level, reinforcing the bullish market structure for the short term. On the 4-hour timeframe, a bull flag setup and a breakout can be seen, with prices breaking out of the setup during the second half of Friday’s session. While the short-term outlook remains bullish, with the RSI trading in the overbought zone in both the daily and 4-hour charts, some consolidation or a slight pullback could be expected till the $3,791 breakout level.
Gold prices in the UAE are as follows –
24 Carat – AED 458.08
22 Carat – AED 419.91
21 Carat – AED 400.82
18 Carat – AED 343.56
