Oil slips, CPI could make or break gold

Oil slips after retracing back to previous trend lows

Oil prices are slipping on Wednesday after partially recovering over the last four days. Crude ran into resistance around the bottom of the December-March range lows which suggests, for now at least, traders are not of the view that OPEC+ output cuts fully offset the difficulties that lie ahead for the global economy which will ultimately weigh on demand.

Further action by the cartel or calmer conditions in US banks could see oil prices bounce back once more but for now, we may have entered into a period of uncertainty ahead of the OPEC+ meeting in June. At which point the group could opt to prop up the market once more, especially if prices remain under pressure.

Make or break release for gold?

Gold is treading water ahead of the CPI data, a release that could be the catalyst for new record highs in the yellow metal or a broader correction. It’s already struggled around those previous highs and a hot inflation number today could put an end to hopes of new records in the near term. Of course, there’s still some way to go before it reaches key support around $1,970 but a break of this could signal a deeper correction.

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