Outlook on Brent crude oil, gold and natural gas post Fed rate hike
Outlook on Brent, gold and natural gas following Wednesday’s widely expected 25-basis point Fed rate hike.
Brent crude oil recovery likely has further to go
Brent crude oil has risen for three consecutive days despite losing upside momentum on Wednesday afternoon when the Energy Information Administration (EIA) report for the week ending 17 March showed that US crude inventories unexpectedly expanded by 1.1 million barrels to the highest level since May 2021.
The Brent crude oil chart remains bullish on the outlook for top crude importer China which according to a recent report is expected to drive a two million barrel rise in daily global oil demand this year and as Russia’s Deputy Prime Minister Alexander Novak said the country has decided to keep its output at a reduced level through June.
Were Wednesday’s high at $76.85 to be exceeded, the January trough at $77.65 would be next in line, followed by the February low at $79.04, both of which are likely to act as resistance, at least in the short-term.
Minor support comes in around the $75.00 mark and at Monday’s $73.71 high.
Gold rallies on a weaker US dollar
Gold’s short-term retracement lower from last week’s one-year high at $2,009 per troy ounce to Wednesday’s $1,935 low was followed by another up leg as the Federal Reserve (Fed) hiked its rates by a widely expected 25-basis points, taking the fed funds to 4.75% to 5.00% and pushing the greenback lower whilst lifting the price of the precious metal.
Treasury Secretary Janet Yellen’s statement to lawmakers that the US government was not considering a “blanket insurance” for bank deposits provoked a bearish reversal in US equity markets which gave the gold price a further boost with it so far having risen to $1,983.
Further up lurks the psychological $2,000 mark and Monday’s high at $2,009, a rise above which would eye the all-time high at $2,070 reached in March 2022.
Minor support remains to be seen at the $1,959 February peak and further support at Wednesday’s $1,935 low, an unexpected fall through which, for today at least, would target the 13 March high at $1,914.
US natural gas futures continue to slide
US natural gas futures are slipping further towards their $2.105 late February low on forecasts for milder weather and as the EIA expects 2.4% less US natural gas consumption in 2023 than in 2022.
US natural gas prices dropped by around 75% from their $9.977 August 2022 peak but are currently trying to find support around the 2021 low at $2.264, having earlier this week dipped to $2.216. If slipped through, the February low at $2.105 will be back in focus below which lies the psychological $2.000 mark.
Resistance can be spotted around the $2.362 early February low and between the mid-March lows at $2.455 to $2.457.
Related articles
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
