The U.S. dollar retreated yesterday following a brief rebound, driven by data indicating a robust U.S. labor market. This development heightened the likelihood of an interest rate hike by the Federal Reserve this month, resulting in a decline in gold prices to nearly one-week lows.  

Meanwhile, oil prices remained relatively stable as market participants assessed the balance between tightening U.S. crude supply and the growing possibility of a U.S. interest rate hike, which could potentially impact energy demand. 

Gold>>

In the early Asian session today, spot gold remained relatively stable, with prices trading around $1911 per ounce. Yesterday, following the release of robust U.S. economic data, including the “small non-farm” ADP report, gold prices experienced a significant plunge, briefly dropping below the $1900 per ounce level. Market analysts suggest that the focus will now shift to the U.S. non-farm payroll report, which is expected to spark another major movement in the gold market. 

After the release of U.S. economic data yesterday, gold prices tumbled significantly from the intraday high of $1927.66 per ounce, reaching a low of $1902.61 per ounce before experiencing a slight rebound. Spot gold closed at $1910.60 per ounce, marking a decline of $4.64 or 0.24%. 

Gold witnessed a retracement during the final hours of yesterday’s session, reentering a trading range, but with a downward shift in both the highs and lows. The overall trend appears to be a bearish consolidation, gradually setting new lows after repetitive consolidations and corrections. 

Technical Analysis: 

Today’s short-term trading strategy suggests focusing on short selling during rebounds as the primary approach, while considering long positions during pullbacks as a secondary approach. 

• Key resistance levels to monitor in the upper range are around 1915-1918. 
• Key support levels to monitor in the lower range are around 1893-1895. 

WTI Crude Oil>>

In the early Asian session today, WTI crude oil was trading near $71.78 per barrel. Oil prices remained nearly unchanged yesterday as the market weighed between tightening U.S. crude supply and the increased likelihood of a U.S. interest rate hike, which could weaken energy demand.  

The U.S. labor market continued to demonstrate resilience, with close attention being paid to the June non-farm payroll report. 

During the U.S. session yesterday, WTI crude oil was trading around $71.87 per barrel. Saudi Energy Minister Prince Abdulaziz bin Salman stated that as part of the OPEC+ alliance, Russia and Saudi Arabia continue to promote strong cooperation, and OPEC+ will take necessary measures to support the market.  

Strong cooperation between Saudi Arabia and Russia in production cuts, coupled with a significant drop in U.S. crude inventories, supported the upward movement of oil prices. 

Yesterday, crude oil further increased and closed higher on the daily chart, forming a bullish candlestick that aligned with expectations from the previous daily analysis. In the short term, there was a staircase-like upward rebound within a range, nearly capturing the intraday low.  

With the daily close higher, the short-term focus remains on an upward rebound towards the upper range, with the breakout determining the future price direction. After finding support near the lower Bollinger Band, oil prices continued to rebound, and by stabilizing above the middle Bollinger Band, further upside movement is expected.  

In the short term, there is a bias towards testing the resistance near the upper Bollinger Band around $72.80. However, as the Bollinger Bands are running horizontally, if the resistance near the upper Bollinger Band cannot be breached, caution should be exercised as oil prices could potentially fall back towards the lower Bollinger Band. 

Technical Analysis: 

Today’s short-term trading strategy suggests focusing primarily on buying at dips, with selling on high rebounds as a secondary approach.  

• Key resistance levels to monitor in the upper range are around 73.0-73.5. 
• Key support levels to monitor in the lower range are around 71.0-69.5. 

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