Oil stays above USD50, gold slips

Oil rally faces near-term risks

Oil prices are edging higher after pulling back a little at the end of last week. They remain near their highs though, with Brent holding above USD50 a barrel. I do wonder whether it is running out of steam though and given the near-term downside risks as Germany goes into a more severe lockdown and the US sees record cases and fatalities, with the trajectory still in the wrong direction going into the holiday period, that could create some downside pressure in the coming weeks. With OPEC+ remaining flexible though, downside risks may be more limited than we would otherwise see.

Gold paring gains ahead of the Fed

Gold is struggling again today and broken back below USD1,830 this morning where it had been seeing some support over the last week or so. We could see more downside over the next couple of days, at which point we may have a better idea of what Congress and the Fed have in store, both of which could be very bullish factors for the yellow metal. The key support for me is USD1,800 ahead of the meeting on Wednesday. After that, it will depend on just how aggressive the Fed will be.

Matter of when rather than if for bitcoin?

Bitcoin is pushing higher after once again finding solid support around USD17,600 in recent days. The crypto is already seeing some profit-taking on approach to the highs, just below the psychologically significant USD20,000 level. This has been a massive barrier over the last month but I remain confident that it’s a case of when rather than if. Trading over the last week or so has only made me more confident that a break is coming and once it does, it could really gather speed given the hype that would come with it.

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