Crude Oil, Bitcoin and Gold Face Market Pressures Amid Global Uncertainty and Technical Challenges – Century Financial

• Crude Oil

Hedge funds are turning less optimistic on crude oil’s prospects, trimming net-bullish bets in a further sign of market softening.
Net-long positions for US marker West Texas Intermediate fell for a fourth week to the lowest since October. The corresponding measure for global benchmark Brent was dialed back by the most since December in a third consecutive drop. The moves were driven both by a decline in long-only positions, as well as a build in short-only ones, according to data from ICE Futures Europe and the US Commodity Futures Trading Commission.
Oil has sold off in recent weeks amid a host of drivers, with traders concerned that US tariffs and talks on the war in Ukraine could impact market dynamics. In addition, Iraqi exports from its semi-autonomous Kurdistan region may resume, although cartel OPEC+ may defer planned output hikes. WTI capped five weeks of losses last Friday, the longest losing streak since late 2023.

• Cryptocurrency

Bitcoin and major altcoins traded lower on Monday, February 24, as the market faced pressure from a major crypto hack and technical resistance levels. Bitcoin slipped 0.6% to $95,708, while Ethereum declined 2.5% to $2,688. The global crypto market cap dropped 1.5% to $3.14 trillion in the past 24 hours.

Bitcoin continues to struggle below the $96,200 resistance. Most altcoins remain significantly down from their recent all-time highs. The latest pullback was triggered by one of the largest crypto hacks, where a hacker exploited ByBit to withdraw $1.4 billion in ETH to an unknown address.

Bitcoin remains range-bound between $95,000 and $97,000. However, a breakout toward $100,000 seems imminent, though a local low around $94,000 may be tested before an uptrend. Despite a 3% drop following the ByBit hack, Bitcoin stabilized above $95,000, boosting investor confidence. Notably, 200,000 new BTC wallets were created in the past 48 hours, indicating renewed interest. 

• Gold

Gold is hovering near a record high of $2,955, which was set last Thursday. Gold traders remain cautious and refrain from aggressive bets on gold as they look forward to the PCE inflation data due later this week.

The uncertainty surrounding Donald Trump’s trade tariffs and their potential impact on the global economy, coupled with a broader risk-averse sentiment, continues to support safe-haven bullion. Additionally, geopolitical tensions and persistent weakness in the US dollar further strengthen the commodity. Data released on Friday fuelled worries about the US growth outlook and dragged the US Dollar to its lowest level since December 10, which turns out to be another factor underpinning demand for the commodity.

The S&P Global US Composite PMI dropped to 50.4 in February from 52.7 in January, pointing to a weaker expansion in overall business activity across the private sector amid worries about Trump’s tariff plans. The University of Michigan reported that its US Consumer Sentiment Index dropped more than expected to a 15-month low level of 64.7 in February compared to the previous month’s final reading of 71.7. Moreover, households saw inflation surging to 4.3% – the highest since November 2023. These data points, along with hawkish FOMC minutes, suggest that the Fed may keep rates steady for an extended period.

From a technical perspective, gold is trading above 9 SMA on the daily chart. Gold could face resistance at the all-time high level of $2,955 with support at the $2,915 level followed by the $2,900 level.

Gold prices in the UAE today are as follows –
24 Carat – AED 354.25
22 Carat – AED 329.75
21 Carat – AED 316.00
18 Carat – AED 271.00

• U.S. Markets

On Friday, markets experienced a sharp selloff following weak economic data. The S&P Global Services PMI came in at 49.7, below the expected 53.0, indicating contraction. Meanwhile, the Michigan Consumer Sentiment Index dropped to 64.7 from 71.1, raising concerns about weakening consumer confidence. This data compounded worries sparked by Walmart’s disappointing guidance on Thursday, which hinted at slowing consumer demand. As a result, the S&P 500 tumbled 1.7%, the Nasdaq slid 2.1%, and small-cap stocks plunged 2.8%. Notably, the S&P 500 and small caps posted their steepest single-day percentage declines since December 18, 2024. Looking ahead, Nvidia’s earnings on Wednesday will be a key market event. Technically, the S&P 500 is trading at $6,039, below its 9-day SMA, with support at $6,008 and resistance at $6,079.

U.S. Dollar Index

The U.S. dollar index closed 0.29% higher on Friday but erased all gains in Monday’s early session, dropping to its lowest in about two months as investor focus shifted to growth concerns for the US economy and the results of the German election on Sunday. The S&P Global Composite PMI data released for the US on Friday dropped to 50.4 for Feb, down from 52.7 in the previous month, showcasing a weaker expansion in overall business activity. Further weighing on the greenback was the greater-than-expected drop in the US consumer sentiment index amid weaker earnings from Walmart concerning the outlook for the strength of the US consumer. The Euro was up higher by 0.50% against the dollar on Monday, with the German Conservative Party winning the federal election and reviving hopes for a better Eurozone economic outlook. The dollar index traded below its 9-EMA level at 106.892, with potential resistance around the 106.746 level, while potential support could be found around the 106.111 level, followed by the 200-EMA at 105.625.

Last Updated on 3 hours by News Desk 1