Oil remains range-bound, gold ticks lower ahead of Fed

Can oil break above its two-month range after Saudi and Russian cuts?

Oil prices are higher again today but still remain within their two-month range. The rally has been aided by the cuts announced by Saudi Arabia and Russia this week but ultimately, another failure to break above the range will suggest traders have largely shrugged it off.

The previous high in Brent two weeks ago came just above $77 and a failure to hit that will represent yet another lower peak over the last month or so and may, therefore, merely confirm that we remain in a very gradual consolidation. We do appear to have seen a slight uptick in momentum over the last couple of days though so perhaps we’re going to see a real test of the previous peak, a break of which could be quite bullish.

Gold pares gains ahead of the Fed minutes

Gold is marginally lower on the day after running into resistance around $1,930-$1,940. This was the first big test as part of the recovery we’ve seen over the last week and so far it’s fallen short. We may see another run at it, early profit-taking may have just taken the wind out of the sails, although that in itself isn’t a great sign.

It may well be that traders have an eye on the FOMC minutes as a potential catalyst that triggers a lot of volatility in the yellow metal so are taking a more defensive stance in anticipation. The jobs on Friday could be more influential though as the minutes are unlikely to tell us something game-changing, while a weak jobs report could signal a significant shift.

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