DailyFX

Gold, Crude Oil Look to G20 to Fuel Continued Recovery

Ilya Spivak

Gold and crude oil prices are looking to a softening tone on debt reduction from G20 officials to boost risk appetite and extend a recovery into the week-end.

Talking Points

  • Crude Oil Prices Look to G20 Statement to Fuel Continued Recovery

  • Gold and Silver Find Support on Ebbing Haven Demand for US Dollar

Commodity prices are on the upswing as risk appetite continues to recover into the end of the trading week. Cycle-sensitive crude oil prices are following stocks higher while gold and silver are enjoying de-facto support as ebbing haven demand weighs on the US Dollar.

Looking ahead, a quiet economic calendar keeps the spotlight on a meeting of G20 finance ministers and central bank governorsin Washington DC.As we discussed yesterday however, the traders are likely to be most concerned with commentary relating to the state of the global recoveryin the context of mounting concerns that erupted into large-scale risk aversion at the start of the week.

The central point of discussion on this front is the pace and timing of fiscal austerity efforts, with a focus on recent efforts in Europe and the US. A softer, more growth-friendly tone on the need for near-term debt reduction is likely to boost risk appetite, reinforcing the “risk-on” dynamics.

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WTI Crude Oil (NY Close): $87.73 // +1.05 // +1.21%

Prices are testing above resistance at 88.45, the 23.6% Fibonacci retracement, with a break higher targeting the 38.2% level at 90.21. Near-term support is at 87.37, the 14.6% Fib. A reversal beneath that aims for the April 18 low at 85.61.

Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_4.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery
Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_4.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1390.59 // +14.09 // +1.02%

Prices are recovering toward resistance at 1433.58, the 76.4% Fibonacci expansion. A break above that targets the 61.8% level at 1468.63. Near-term support is at 1376.93, the 100% Fib, with a reversal below that initially exposing the 114.6% expansion at 1341.88.

Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_3.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery
Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_3.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $23.26 // -0.07 // -0.30%

Prices found interim support at 22.54, the 23.6% Fibonacci expansion. Near-term resistance is at 23.46, the 23.6% Fib retracement, with a break above that initially exposing the 38.2% level at 24.34. Alternatively, a drop below support aims for the 38.2% expansion at 21.66.

Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_2.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery
Commodities_Gold_Crude_Oil_Look_to_G20_to_Fuel_Continued_Recovery_body_Picture_2.png, Gold, Crude Oil Look to G20 to Fuel Continued Recovery

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.204 // +0.016 // +0.50%

Prices are testing support at 3.151, the 61.8% Fibonacci expansion, with a break below that exposing the 76.4% level at 3.080. Near-term resistance is at 3.208, the 50% expansion. A reversal back above that targets the 38.2% mark at 3.265.

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