Daily market recap for 15.06.2018
It seems that Gold has played out a massive Bearish flag on the Daily chart as the market actions showed on Friday. The breach was at 1297.451 and the movement accelerated sharply after that. It has breached 1291.702 and 1289.284. There was a small period of short covering and selling continued, passing 1282.970 as well. Overall the decline for the day ended at 1275.320 and the price finished in the last hours of the US session with a small technical correction and another shorts covering. The price has lost $21 of its value in a very short matter of time. There was no real catalyst, news or a fundament that can so quickly change the view for Gold and make it tumble big time. All I can think of here is that someone dumped Gold to be on Stocks and on the USD for a future sharp rise. Well, maybe not for Stocks, but for the USD for sure. The reason? The Trade War that has begun between the US, China, Canada, the EU, and India. We are still not seeing the full effects of that commerce brawl between the major countries and it will have its consequences with global disruption in trade. We can all imagine to what can lead one spark of a Trade War as well, right? Tensions will rise as the tariffs and restrictions which are imposed now are regarding agricultural and auto sector and other commercially important goods like Oil, Natural Gas, Coal and more tariffs to come after the ones starting on July 6 from China regarding mainly Soybeans. So the picture for Gold isn't looking good as the Friday's movement down may be the catalyst for a long-term downtrend. The Greenbuck will get moving fast up, but it will start to hurt Inflation in the US in the long run, which isn't going to be suitable for the FED's policy. On Gold, the price will make a small correction in a range formation between 1282.970 and 1275.320 before finding any solid direction. Trade it mindfully and to don't rush straight away selling the XAU/USD.
Crude Oil is also playing out a Bearish flag configuration in the Daily chart, successfully triggered by the catalyst - OPEC. The attack on the 50 Fibo level was nothing too hard for the price as it managed to breach it with great determination. Pirce moved lower after that, staying under 64.80 and has just landed on 64.23, closing for Friday there. With the Bears gaining momentum we will see next week a move towards 38.2 Fibo (63.60). If successful and Bears establishing their full control as the sentiment is to sell WTI with the upcoming OPEC meeting, the price will make a move down to 23.6 (61.53) and the 200DEMA. For the long-term everything will be decided at that level as it is going to test the 200 daily moving average and the last Fibo retracement level. This may bring an end to the hyped uptrend for Oil and completely reduce the hopes for some sides and participants for a oil above $70... for now. Shorts are preferred, of course, careful with the stop losses and right before the OPEC meeting begins we will have another Wednesday Inventories report.