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Gold, oil and coffee prices make gains

A weaker dollar and a broad risk-on move have helped lift commodity prices in general, although volumes are muted with a US holiday today.

​Gold returns to last week’s high

A weakening US dollar has given gold the space to move higher in early trading, as markets begin to make some revisions to their view on Federal Reserve (Fed) tightening over the course of the year.

While steady rises in interest rates are still expected, the latest set of Fed minutes suggested that policymakers are in no rush to ratchet up the tempo of rises, and may indeed be concerned already about the potential slowing of the US economy. As a result the dollar has weakened, and gold has managed to edge higher.

The first hurdle would be the move above last week’s highs at $1870. Should this go, then $1883 and $1907 come into view.

A reversal below the 200-day simple moving average (SMA) at $1840 hands the sellers the upper hand and targets the May lows at $1787 once more.

Brent prices make headway

While an immediate surge here seems off the cards now that a European ban on Russian oil imports becomes less likely, thanks to opposition from the likes of Hungary and others, the weaker dollar has provided a lift for oil prices.

After rallying last week, the price has been able to push on above the early May highs around $114, and seems to have the mid-March peak in sight.

From current levels, $120.50, the mid-March high, comes into view, while beyond this a continued bullish move would begin to target the early March surge high at $131.50.

Rising trendline support from early May has helped underpin price gains over the last two weeks, so a reversal below $114 would be needed to break this. From there $105 and then $101 come into view.

Coffee Arabica breaks higher

Coffee prices enjoyed a strong end to the week, joining in the general market rally and abetted by the weaker US dollar.

Coffee prices remain on the lookout for a dryer period of weather that will provide an additional upward lift, after a steady decline from the February highs.

The price has made a second attempt to break above trendline resistance from the February highs, and this time it may succeed. It has returned to the highs from mid-May around $2.28, with a further move higher targeting the April high at $2.37.

A reversal back below $2.20 would be needed to suggest that another move to the $2.10 support zone is in play.

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