Oil edges higher, gold struggling

Edging higher

Oil prices are a little higher at the start of the week with a few factors potentially behind the move. Turkey’s decision to temporarily halt flows to the Ceyhan terminal may have lifted prices a little given the uncertainty around the situation, although, with reports of no damage to pipelines, the impact should be marginal. ​

There is also a growing expectation that China will bounce back strongly following the decision to scrap zero-Covid restrictions which will spur more demand over the course of the year and boost prices. As the world’s largest importer and second-largest economy, its outlook is a huge factor in the oil market. The final reason could be more technical, with the price having fallen quite significantly over the last week or so.

Into correction territory

Gold has been left licking its wounds after sliding almost 5% from its highs towards the end of last week. The yellow metal was already looking quite overbought and was struggling for momentum on its most recent surge and so was potentially primed for a correction but the US data certainly finished the job.

It’s trading a little higher today but the rebound has been weak so far and after such a strong recovery since early November, there could still be a little further to run. The next key level of support below could be around $1,820-$1,830.

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