Crude Oil And Gold Point To A Temporary Dip
Daiviet Huynh | May 01, 2019 02:39AM ET
Crude Oil markets attempted to surge during the past week but have struggled a bit since yesterday. Venezuela has been in the spotlight and will influence the development of the crude oil price action, whether on a downward continuation or a breakout towards $70. Crude Oil originally rallied throughout the trading session on Tuesday but dropped short of retaking the $65 level. It will be challenging to extend to the upside. At this time, it is highly probable that the market will remain noisy. Hence, anxieties are coming from the Venezuelan situation combined with the OPEC meeting. With these events going on in parallel at the moment, we can assume there will be significant volatility in the crude oil market. If the crude oil price breaks through below the $62 level, we will be more likely to head to the $60 handle. Our near term view is to take the opportunity to buy the dip at the current market price with a primary target price at $65.
Gold is currently stuck in a tight range. If Gold declines to a new low, it is foreseeable to consider the $1250 level. If the price action turns around and breaks up, the $1300 level need to be cleared to have sufficient support and allow further upside potential. At that point, we can consider significant noise on the market. Policy makers are thoroughly supposed to keep interest rates on hold. Fed Chairman Jerome Powell's statement will be closely scrutinized for clues after the panel abruptly delayed its plan for rate hikes in January. Hence, Gold bounced as smart traders and investors become used to buying the dips, therefore we favor a buying opportunity on gold at market price below $1280.
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