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OPEC+ Shuns US Request, Gold Eyes $1,800

Oil under pressure even as OPEC+ shuns US request

Oil prices coming under further pressure on Tuesday after rebounding off its lows once more at the start of the week.

This came after OPEC+ sources claimed the group sees no need to ramp up production faster, following comments from the White House last week.

In much the same way that the market slipped following the comments last week before quickly recovering, the short-term burst on Monday is proving short-lived. We’re unsurprisingly back where we started, with OPEC+ responding to market forces not political pressure.

That leaves crude prices looking vulnerable as we continue to see $65 support in WTI but less forceful rebounds that see sellers pour in earlier.

A move below here would be a significant technical breakout and surely reflect serious concerns about growth in the coming months as delta causes increasing restrictions around the world. New Zealand overnight became the latest to go back into lockdown following a single community case.

Gold running into big resistance

Gold prices are continuing to perform quite well following a really strong rebound from last week’s flash crash.

US yields have continued to soften this week which is giving the yellow metal a much-needed boost. It’s now closing in on $1,800 where is could run into significant resistance.

This marks a 50% retracement of the June highs to August lows and could be a big psychological test for gold. That said, $1,815-1,825 is arguably more signficiant with it falling around the 61.8 fib level, prior highs and 200 day moving average. A move above here may come as a surprise to many and send a very bullish signal to the market.