Gold Market Analysis:
On Wednesday, September 18, spot gold prices were initially pressured, dropping close to $2560 per ounce due to stronger-than-expected U.S. retail sales data. However, the price rebounded significantly from its lows, closing around $2570 per ounce. Analysts pointed out that escalating conflicts in the Middle East could lead to increased safe-haven buying, which stimulated gold’s recovery from its low. Hezbollah has accused Israel of orchestrating a series of bomb attacks, claiming that Israel will face “fair punishment.”
On Wednesday, investors will focus on the Federal Reserve’s interest rate decision and the subsequent press conference by Chairman Jerome Powell, which is expected to trigger significant movements in the gold market. According to the CME FedWatch Tool, the likelihood of a 50 basis point rate cut by the Fed is at 63%, while the probability of a 25 basis point cut stands at 37%. Despite the recent drop in gold prices, there remains an upward bias. Gold is on the verge of forming a bearish chart pattern known as the Evening Star, characterized by three candlesticks. In the short term, momentum favors sellers, with the Relative Strength Index (RSI) declining and breaking below previous peak levels, indicating increasing bearish strength.
Gold Strategy for Today: It is recommended to focus on buying on dips while considering selling on rebounds. Watch for resistance at the $2570 level and support at the $2540 level.
Crude Oil Market Analysis:
On Wednesday, September 18, despite some optimistic viewpoints presented at the APPEC conference, it was clear that most speakers and attendees believe future oil demand growth is relatively weak. This contrasts sharply with predictions of stable supply growth, creating a persistent dilemma for OPEC. Participants engaged in heated debates over how OPEC could restore production without exerting greater downward pressure on flat prices—even risking sustained and meaningful futures premiums in the forward market that could support larger stockpiles.
For OPEC, the biggest takeaway seems to be that protecting prices by not restoring production is feasible. Alternatively, they might protect member unity by increasing production quotas. However, there is a consensus that finding a path that balances both objectives is becoming increasingly difficult. According to S&P Global Commodity Insights, OPEC and its allies decided on September 5 to extend their voluntary production cuts for two additional months until the end of November. This is largely seen as a neutral stance on oil, though the short-term fundamentals are undoubtedly bearish.
Crude Oil Strategy for Today: It is recommended to focus on selling on rebounds while considering buying on dips. Watch for resistance at the $70.7 level and support at the $67.7 level.
Caution is advised, and the strategies are for reference only.
