Oil lower on strong dollar, Gold volatile, Bitcoin at $29k

• Oil’s worst slide in a month as demand concerns grow
• Surging yields weigh on gold
• Binance had a 16,000 bitcoin sell order before the 4am plunge

Oil

Oil prices declined as the dollar rebounded and after a mixed oil inventory report raised demand concerns. ​ Gasoline demand showed unexpected weakness as inventories posted a surprise build of 1.3 million bpd vs an expected drop of 1.5 million bpd. ​ The headline draw of 4.5 million barrels was larger-than-expected, but that was because it was the end of maintenance season. ​

WTI crude is back below the $80 level and it could continue drifting lower if the strong dollar trade resumes.

Gold

Gold prices are back where they belong. ​ After a tentative dip below the $2,000 level, buyers emerge as investors remain unsure about what to expect with the next wave of earnings and as the debate over the Fed’s path continues. ​ In order for risk appetite to remain in place, Wall Street needs to see robust mega-cap tech earnings and become convinced that the Fed won’t be tightening rates beyond the May 3^rd meeting.

Political, earnings and credit risks should help send some safe-haven flows gold’s way, but if the king dollar trade returns on expectations that the Fed might need to deliver a few more rate hikes, it could get ugly. If gold doesn’t recapture the $2025 level soon, sellers might easily take over here. ​

Bitcoin

Bitcoin plunged earlier in Europe as some crypto investors decided to dump large positions before NY got to their trading desks. ​ The 3% Bitcoin drop occurred shortly after 4am est, which means they wanted to do it before the next round of earnings and after a hot UK inflation report. ​

There are some clear signs of exhaustion with the growth of the global crypto market cap and if we are looking at a consolidation period, this seemed like a good time to get out.

Bitcoin is holding onto the $29,000 level, but if downward pressure continues support does not emerge until the $28,550 region. ​ ​

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