Oil extends losses, gold under pressure

Markets testing Saudi threats

The pessimism in the markets is filtering through to oil where prices have fallen 2% again on Thursday. I’m not sure Saudi Arabia expected markets to test their nerve so quickly but it seems the suggestion that a reduction next week won’t be considered has removed the production cut risk for now.

It will be interesting to see how much traders decide to test the alliance, something that may invite more verbal intervention and perhaps even a change of heart ahead of the meeting. For now, Brent and WTI are edging ever closer to their August lows.

Gold may be eyeing July lows

After breaking below $1,730 support earlier in the week, gold is now pushing below $1,700 and could have the July lows around $1,680 in its sights. The yellow metal did not take Jerome Powell’s comments at Jackson Hole very well and has been on the decline since. It’s off around 3.5% from the highs of last Friday and a break of $1,700 could see it come under further pressure. The key test is $1,680 though and a break of this could be a very bearish development.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.