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Oil price rallies for third day while gold and aluminium stabilise

WTI outlook is bullish short-term while gold and aluminium views are neutralised.

Gold remains sidelined

The Spot Gold price continues to range trade below its 200-day simple moving average (SMA) at $1,844 per troy ounce, which capped it throughout this and last week, with the mid-June low at $1,806 remaining in sight as US treasury yields remain at elevated levels.

Further down the May trough can be spotted at $1,787. Minor resistance above the April-to-June downtrend line and 200-day SMA at $1,844 comes in at last week’s high at $1,848 with further resistance sitting at the 16 June high at $1,857.

While the next higher current June highs at $1,874 to $1,877 cap, the last few months’ downtrend remains in place.

WTI is seen rallying once more

West Texas Intermediate (WTI) crude oil’s around 15% slide from its $121.43 early June high probably ended at last week’s $101.22 low with it now having left its downtrend channel to the upside on supply concerns.

The price of oil is rising for the third session in a row, as Saudi Arabia and the UAE are reportedly very close to their near-term capacity limits while the G7 has vowed to impose new sanctions which aim to cap the price of Russian oil. Added to that are worries that political unrest in Ecuador and Libya might curtail oil supply from these nations.

The early May high at $110.48 is currently being probed with the mid-May high at $113.30 being next in line and then the mid-June peak at $116.53.

Minor support below the 55-day SMA at $108.86 sits at the 17 June low at $106.36.

Aluminium stages minor recovery rally off its near one-year low

Aluminium’s swift descent due to worries of a potential global recession decreasing demand for the metal has taken it close to the July 2021 low at $2,421 by dropping to $2,423 last week before trying to stage a minor recovery rally.

The immediate downtrend will remain intact while the price of aluminium stays below last Tuesday’s high at $2,558 on a daily chart closing basis, though, since it represents the last reaction high on the daily chart.

Further resistance can be found at the December 2021 low at $2,582 and more significant resistance along the three-month downtrend line at $2,596 as well as at the $2,649 16 June high.

Failure at $2,421 would put the June 2021 low at $2,355 on the cards.


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