October 16, 2022 [Fxempire] – WTI oil declined towards the $92 level as traders took some profits off the table after the recent rally.
From a big picture point of view, the market continues to balance between supply worries and recession fears. OPEC+ production cuts and the potential consequences of the price cap on Russian oil provide support to oil prices. At the same time, the global economy is slowing down, which is bearish for oil markets.
The current pullback in the oil markets looks natural after the major rally. Most likely, WTI oil will need additional catalysts to move above the $94 level.
Gold Is Under Pressure As Dollar Tests New Highs
Gold settled below the support at $1665 as the U.S. dollar gained more ground against a broad basket of currencies.
The nearest support level for gold is located at $1660. If gold manages to settle below this level, it will head towards the next support level at $1640. A successful test of the support at $1640 will push gold towards the support at $1615.
On the upside, the previous support at $1675 will serve as the first resistance level for gold. If gold climbs back above this level, it will head towards the 20 EMA, which is located near $1690. A move above the 20 EMA will push gold towards the 50 EMA at $1710.
Silver and platinum have also found themselved under pressure at the start of the week. Silver is currently trying to settle below $19.50, while platinum is moving towards the $900 level. Meanwhile, palladium is trading near $2200.
Natural Gas Lacks Momentum As Traders Wait For Catalysts
Natural gas is stuck near the $6.75 level as traders wait for additional catalysts. The recent EIA report has put some pressure on the market, but natural gas remains stuck in the wide $6.30 – $7.20 range.
In Europe, natural gas prices moved higher after Russia’s strikes on Ukraine’s power infrastructure. Ukraine has already warned that it would stop exporting electric power to the EU, which will increase demand for natural gas in Europe. The situation in the European markets will have an impact on U.S. markets in late November when Freeport LNG restarts operations.
Copper Rebounds From Recent Lows
Copper found support near $3.40 and moved back above the $3.45 level despite recession worries.
Copper markets lack momentum, and it looks that traders wait for significant catalysts that could move copper out of the current trading range.
For a look at all of today’s economic events, check out our economic calendar.
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