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Commodities and Cryptos: Oil market getting tighter, Gold battered as yields rally,


Oil

A tight oil market just got hit with supply disruptions and geopolitical risks, which means oil prices are headed higher.  Oil prices were boosted after growing unrest in Kazakhstan posed a risk to their 1.6 million barrels per day of production.  Insurgents were responsible at the beginning of the year for sending Libyan production to the lowest levels in more than a year. 

Energy traders are growing very confident this market will remain very tight and now that omicron worries have eased oil prices could have an easy path towards the highs seen in November. 

Gold

Gold traders knew it was going to be a bloodbath after real yields had a major breakout.  The hawkish Fed minutes triggered massive selling pressure for gold and that should be over until the nonfarm payroll report.  If the December payroll report delivers a massive beat, the pain could continue for gold.

The March Fed policy meeting will be a live one and that should continue to support the move higher with Treasury yields, but that doesn’t mean gold will continue to remain in the house of pain. Wall Street has priced in a lot of the Fed hawkishness and US growth exceptionalism verses abroad, but that trend won’t continue deeper into the year and that should translate into higher gold prices.

Bitcoin

Cryptocurrency traders are no longer confident that the $40,000 level may hold. Massive liquidations that totaled over $800 million could have Bitcoin on the ropes for one last major plunge before buyers will be willing to test the waters.  Bitcoin could see a plunge towards $37,000 before buyers emerge.    

This article 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 Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Ed Moya

With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.

Ed Moya
Ed Moya





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