Crude Oil Prices at Risk as Risk Appetite Continues to Sour

CRUDE OIL GOLD TALKING POINTS:

  • Crude oil prices may decline as risk aversion sweeps markets
  • Gold prices’ latest drop may not find near term follow-though

Crude oil prices marked time Monday as a lull in top-tier event risk allowed space for consolidating recent losses. Gold prices dropped to the bottom of their recent range but the move failed to produce a clear-cut directional break. Furthermore, the move seemed to lack clear-cut fundamental impetus, hinting warning against overestimating scope for immediate follow-through.

GOLD MAY RISE AS CRUDE OIL FALLS IN RISK-OFF TRADE

From here, another quiet day on the economic data docket might put prevailing sentiment trends in focus. Shares edged lower in Asia Pacific trade and bellwether SP 500 futures are pointing downward, hinting at a risk-off bias. This might reflect a worried tone from the IMF, which cited trade tensions in cutting its global growth outlook for the first time in two years.

If risk aversion continues to build, gold prices may find scope for something of a recovery as falling bond yields boost the relative appeal of non-interest-bearing assets.

Article source: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2018/10/09/Crude-Oil-Prices-at-Risk-as-Risk-Appetite-Continues-to-Sour.html