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Commodities

Gold prices get some relief amid rising U.S dollar

The precious metal rallied higher at the mid-week trading session as buyers got assurance from the U.S. Federal Reserve.

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Nigeria Mining Sector shows growth prospect despite low bank credit provision, Gold hits eight-year high as global recession sentiments strengthened, Gold hits three weeks high, Investors rush to gold, Gold Future Drops to $1727.80 as Tensions Escalate between America and China, Precious metals slump, investors focus on Central Bank’s intervention, FG inaugurates gold refinery project in a landmark event

Gold rallied higher at the mid-week trading session as the precious metal’s buyers got assurance from the U.S. Federal Reserve Chair, Jerome Powell, that inflation will be tamed.

Gold prices of late have witnessed significant selling pressure; it was unable to ward off a rallying USD. Gold fell as the U.S dollar index tipped above yesterday’s highs.

At the time of writing this report, Gold futures were up by 0.34% to trade at $1,730.90 an ounce. The U.S dollar, which usually moves inversely to the yellow metal, ticked up to a more than two-week high in the early hours on Wednesday.

READ: Nigerian-Canadian company to start gold export from Nigeria in June 2021

Gold bugs got some amount of relief when the U.S. Treasury yields dropped after the U.S Fed told lawmakers on Tuesday that inflation was expected to rise over the course of 2021, but it would be “neither particularly large nor persistent.”

Stephen Innes, Chief Global Market Strategist at Axi, in a note to Nairametrics, spoke on prevailing macros that could give the precious metal some relief in the near term amid strong support for the U.S dollar in the long term.

READ: Leader of world’s most powerful central bank says Crypto unreliable for wealth preservation

“Gold weakened as the US dollar rallied amidst positive comments from US Fed chair Powell and Janet Yellen. Both speakers to Congress had previously released their prepared remarks, which supported the long US dollar view.

Sigma Pensions

“However, lower yields may support and even firm bullion over the short term once the US dollar safe-haven appeal ebbs.”

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Olumide Adesina is a France-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment trading. Message Olumide on Twitter @tokunboadesina. He is a Member of the Chartered Financial Analyst Society.

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    Commodities

    Oil prices surge over China’s growing appetite for energy

    British based contract ticked up by 0.3% to trade at $63.59 a barrel while the WTI futures edged near $60 a barrel.

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    Where next for oil prices?, Brent crude futures gained 0.14 to trade at $34.70 at the time this report was drafted, recovering some of its losses earlier in the oil trading session. , Brent crude price fails to remain over $40, concerns over pledge cut strengthens

    Oil prices rallied high at the second trading session of the week as data from the world’s second-largest oil consumer’s (China) import growth picked up coupled with rising tensions in the Middle East after rebels from Yemen disclosed that they fired missiles on Saudi’s energy infrastructure.

    At the time of writing this report, the British based contract ticked up by 0.3% to trade at $63.59 a barrel while the West Texas Intermediate futures edged near $60 a barrel.

    READ: Oil prices soar above $70 a barrel over terrorist attacks on Saudi’s oil station

    The world’s second-largest economy recorded impressive gains for last month in yet another boost to China’s economic recovery as global demand gained momentum. Crude oil imports into China surged by 21% in March from a low base of comparison a year earlier.

    Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics spoke on the parabolic of the energy market, as oil traders seem to be uninspired on the resurging COVID-19 virus;

    “The oil market’s magnetic attraction to the $63 level should tell us much about the near-term outlook amid conflicting signal of new Covid waves coming to shore ahead of what should be a summer gasoline buying bonanza.

    READ: Did OPEC+ April fool the oil market?

    But overall, this is an oil market that feels completely uninspired outside of a few micro lurches here and there.

    Sigma Pensions

    Still, positive comments on the US economy from Fed Chairman Powell help to reassure the outlook for oil demand, balancing concerns about the continued spread of Covid-19 in some regions.”

    What to expect

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    Recent price actions suggest oil traders might hold the $60 a barrel baseline in the near term even if U.S Treasury yields surge while struggling to resolve with what form and fashion the next leg of the reflation trade will take.

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    Commodities

    Oil prices stay on course as Saudi’s Energy Minister reassures traders

    British based oil contract traded at about $63 a barrel while the WTI futures were trading slightly below the $60 price level.

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    Crude oil prices slump, as partial lockdowns resume

    Crude oil prices remained relatively firm at the early hours of Friday’s trading session as oil traders digested Saudi Arabia’s defense of OPEC+ plans in raising output thereby capping gains.

    At press time, the British based oil contract traded at about $63 a barrel while the West Texas Intermediate futures were trading slightly below the $60 price level.

    Saudi energy minister Prince Abdulaziz bin Salman recently revealed that there were no pressing concerns of demand/supply dynamics changing gear amid the gradual boost in outputs in an interview aired on Thursday, adding that OPEC+ had all ammunition put in place to change course if necessary. OPEC+ will continue to meet monthly on reviewing the energy market supply dynamics.

    READ: Has the Naira been devalued?

    Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics spoke on the prevailing market sentiment amid macros pointing to more oil supplies hitting the sensitive energy market and an upsurge in COVID-19 caseloads.

    “Positioning is much cleaner, although the market remains directionally long oil. However, the sudden calm and drop in volatility have attracted passive investors back to the fray as the market structure around prompt spreads start to tighten and the dollar begins to roll over.

    “Still, the conflicting signals around OPEC+ supply coming back to market amid spiking coronavirus case numbers in India plus parts of Canada as well as Tokyo backtracking into the lockdown Abyss, together with reports linking the UK’s Covid-19 vaccine workhorse to the higher frequency of blood clots, continues to hold the bulls at bay.”

    READ: Did OPEC+ April fool the oil market?

    Sigma Pensions

    What to expect: The most recent OPEC+ agreement on releasing barrels into such present demand was not out of place – suggesting the futuristic price of oil might range between the $60 -$70 price levels with production normalization vs current high excess production capacity taken into consideration.

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