Crude oil prices surged 5.3% on Thursday, settling at $73.84 per barrel, as geopolitical tensions in the Middle East continued to escalate. This marks an 11% increase from the October 1 low of $66.33. While the rally has broken through some short-term bearish trends, it’s largely driven by news rather than fundamental supply and demand factors. As a result, prices are likely to retreat once tensions ease. Meanwhile, the Commitment of Traders (COT) data suggests a bullish outlook for oil, as well as gasoline and heating oil.
In other markets, the SPDR Gold Shares (GLD) ETF has been trading sideways for a week, forming a potential bull flag pattern. Gold has benefited from a weaker US dollar and declining yields, although these trends have recently reversed. Despite the greenback’s recent strength, gold and silver have remained resilient, ignoring the rising currency. The COT data on the dollar has also recently shifted, suggesting a potential change in sentiment. With volatility expected to continue, investors should be prepared for significant price swings in both directions.
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