Oil loses OPEC+ gains, Gold rally falters, Cryptos rally on banking woes

• Oil tumbles on recessionary fears
• Gold struggles as yields push higher
• Bitcoin recaptures $29,000

Oil

Crude prices just saw all of its gains from the OPEC+ surprise production cut erased as macro backdrop has become a disaster. Oil has been in freefall over a challenging economic environment, banking jitters, disappointment with China’s reopening, fears of overtightening by the Fed, and on expectation Permian basin production has yet to peak.

WTI crude pared losses after a bullish EIA report showed gasoline demand roared back. The economy is weakening but it isn’t falling off a cliff, so we shouldn’t be seeing oil trade near the low $70s. ​

China’s recovery is not materializing, and US demand is weaker, so $100 oil won’t be happening. ​

Gold

Gold prices initially rallied as banking worries return to the front burner and as Fed rate hike odds continue to evaporate. ​ It looks like gold’s best friend is a little bit of financial stress as that has helped swaps no longer fully price in a rate hike by mid-year. ​ Gold got its groove back and unless First Republic is miraculous saved and we don’t see any immediate stress on other midsized banks, the precious metal could make a run towards record highs. ​

Gold turned negative as yields turned positive as investors realized the banking crisis was likely contained and the focus will shift back to inflation. ​

Bitcoin

Banking jitters have revitalized life back into cryptos. ​ Bitcoin is surging and so are all the major cryptos as banking stress supports the use case for digital assets. ​ Bitcoin is still facing a ton of resistance and this current rally will likely struggle until we get a clearer regulatory framework for cryptos. ​ ​

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