Gold
On Thursday, a downward revision of the U.S. Q1 GDP data weakened the dollar and U.S. Treasury yields, helping gold rebound after hitting a three-week low.
Gold prices slightly increased, with spot gold initially falling before recovering. It touched a low of $2322.61 during the session, then rebounded to erase all losses and closed up 0.21% at $2343.19 per ounce.
The U.S. Department of Commerce reported on Thursday that GDP growth from January to March was revised down to an annual rate of 1.3%, from the initial estimate of 1.6%. This caused the dollar to drop 0.4% after hitting a two-week high early in the session, closing at 104.75, making gold more attractive to holders of other currencies.
Additionally, U.S. jobless claims increased in the most recent week. The focus now shifts to the Personal Consumption Expenditures (PCE) Price Index report to be released on Friday, which is the Federal Reserve’s preferred measure of inflation and could significantly influence the timing of rate cuts.
Gold Technical Analysis:
Yesterday, gold showed a weak downward trend during the Asian and European sessions, breaking below previous lows before rebounding.
In the evening U.S. session, gold found strong support at the $2330 level, rebounding strongly to break above $2351 before settling into a range and closing.
Today’s Focus:
- Short-term strategy: Recommend shorting on rebounds and buying on dips.
- Resistance: $2355-$2360
- Support: $2320-$2326
Oil
On Thursday, oil prices fell for the second consecutive day following a U.S. government report indicating weak fuel demand and unexpected increases in gasoline and distillate fuel inventories.
WTI crude accelerated its decline after the EIA inventory data was released, falling below the $78 mark and closing down 1.81% at $77.81 per barrel. Brent crude closed down 1.7% at $81.9 per barrel.
The U.S. Energy Information Administration (EIA) reported that U.S. crude inventories decreased more than expected last week, while refinery utilization rates reached their highest level in over nine months.
However, gasoline and distillate inventories unexpectedly rose, indicating reduced demand despite increased production. The downward revision of U.S. Q1 GDP growth and reduced consumer spending also weighed on demand outlooks.
Oil Technical Analysis:
Yesterday, oil prices faced downward pressure in volatile trading, breaking previous lows. During the Asian and European sessions, prices made a small rebound but faced resistance at the $79.3 level, leading to continued downward movement.
In the evening U.S. session, oil prices stabilized at the $78.2 level before rebounding, only to face resistance again at the $79.2 level and close lower.
Today’s Focus:
- Short-term strategy: Recommend buying on dips and shorting on rebounds.
- Resistance: $79.4-$80.0
- Support: $76.0-$76.6
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