Commodities

Capital is rotating into havens such as gold and bonds and pushing the price of crude higher, as Israel seemingly prepares for its ground offensive against Hamas. Israel’s military told Palestinians today to start evacuating northern Gaza and move to the southern part of the territory. Consequently, market participants are on edge as the conflict looks to escalate, following Israel’s retaliation for the brutal Hamas attack that took place in…

UKOil retraced significantly towards its end-of-August low (green dashed horizontal) before finding support. Monday saw significant upside when the market opened following Saturday’s brutal attack by Hamas on Israel and the start of a new Middle East conflict. Nerves still abound that the conflict may spread in the region affecting supply lines, and risk premiums are keeping the oil price supported.

USOIL got a boost on Monday after the armed conflict erupted in the Middle East, but now turns cautious as markets contemplate the potential impact on supply and demand

NGAS extended its gains on Monday due to the Hamas-Israel conflict, but turns cautious today as EIA expects a slowdown in global demand growth ahead and warns of potential market volatility

Markets turn to the safety of gold, as the deadly attack of Hamas on Israel and the country’s retaliation, spark risk aversion

Oil prices rise and stocks of energy giants get a boost, while those of major airliners drop, after Palestinian group Hamas launched a multi-pronged attack on Israel, reigniting conflicts in the Middle East

Oil has dropped substantially this week and particularly over the last twenty-four hours. Currently, Brent crude (UKOil) is down around 8.6% for the week and is trading near $84, and WTI (USOil) is down 9.2% for the week to trade near $82.45.

A gold price top-down analysis.

The US 10-year real yield continues to climb higher and is currently at 2.286%, largely due to the Federal Reserve’s narrative of “higher for longer.” This is adding headwinds to the risk market and driving money towards the safety of the dollar. This, in turn, is impacting on gold. The precious metal is moving inversely to the real yield. To this end, the correlation coefficient (bottom indicator) between gold and…

Pullback may set up a "dip in the uptrend" scenario.

USOil dropped last week after the Fed’s hawkish stance and fears over US government shutdown reignite, but supply curbs support prices