28 Oct 2013
Gold, Oil tread water ahead of US data, FOMC
FXstreet.com (Athens) – Gold and Oil prices are mostly muted today, despite risk appetite had hit the on button, mainly due to the fact that market participants wait for the upcoming US data to shape their bets on ‘tapering’.
Oil is trading on opposite sides on the two sides of the Atlantic ocean, while mostly heading sidelines on both of them. Briefly, crude oil is trading at 97.69 down 0.23%, while Brent is heading north at 107.43, up 0.20%. Gold is also little changed, trading at 1351.95, up 0.03%. While US industrial production and pending home sales releases are on tap, market participants are mostly focused on the FOMC meeting on Wednesday, in order to see if finally the Fed will maintain the “full-sized” QE3 program for significantly longer. Nevertheless, such a result will probably support an uptrend shift for both gold and oil, as it will boost risk-appetite, thus we might witness a further dollar depreciation. What’s more, traders should bear in mind that any soft release regarding US data until Wednesday, will boost risk appetite as it will be probably priced in by markets as a strong sign for continuation of QE3 at $85B/month by Fed. On Friday, gold inched up slightly as disappointing U.S. economic data reinforced expectations that the U.S. Federal Reserve will keep its stimulus intact well into 2014. Finally, U.S. oil futures ended higher for the second day in row on Friday while European Brent crude fell, tightening the trans-Atlantic spread as traders bet that increasing refinery operations and a major new Midwest pipeline will slow the rise in inventories.
Oil is trading on opposite sides on the two sides of the Atlantic ocean, while mostly heading sidelines on both of them. Briefly, crude oil is trading at 97.69 down 0.23%, while Brent is heading north at 107.43, up 0.20%. Gold is also little changed, trading at 1351.95, up 0.03%. While US industrial production and pending home sales releases are on tap, market participants are mostly focused on the FOMC meeting on Wednesday, in order to see if finally the Fed will maintain the “full-sized” QE3 program for significantly longer. Nevertheless, such a result will probably support an uptrend shift for both gold and oil, as it will boost risk-appetite, thus we might witness a further dollar depreciation. What’s more, traders should bear in mind that any soft release regarding US data until Wednesday, will boost risk appetite as it will be probably priced in by markets as a strong sign for continuation of QE3 at $85B/month by Fed. On Friday, gold inched up slightly as disappointing U.S. economic data reinforced expectations that the U.S. Federal Reserve will keep its stimulus intact well into 2014. Finally, U.S. oil futures ended higher for the second day in row on Friday while European Brent crude fell, tightening the trans-Atlantic spread as traders bet that increasing refinery operations and a major new Midwest pipeline will slow the rise in inventories.