Oil tries to find a bottom, Gold wavers, Bitcoin softens

• US Oil rig counts rise by two to 591 (Gas rigs up 2 to 161)
• Gold sub $2000 as yields slide, 10-year Trea­sury yield falls 8.1 bps to 3.439%
• Bit­coin falls 1% to $29,344

Oil

The oil mar­ket sell­off got out of con­trol.  Tech­ni­cal sell­ing was not going to end until they filled the gap made from the OPEC+ pro­duc­tion cut announce­ment ear­li­er this month.  The pulse of the US econ­o­my is not too bad if you ask the Atlanta Fed and if the US econ­o­my comes any­where close to grow­ing at 1.7% in the sec­ond quar­ter, oil prices will prob­a­bly be much higher. 

After hear­ing from Exxon and Chevron, it is hard not to be short-term bull­ish oil prices. Exxon CEO Woods was con­struc­tive on the demand out­look, adding that gaso­line demand is rea­son­able and that jet fuel demand is trend­ing up.  Regard­ing Chi­na, Chevron’s Wirth not­ed that jet demand is grow­ing and trav­el is up to near­ly 90% of pre-covid levels. 

Crude prices should have no trou­ble ral­ly­ing above the $80 a bar­rel lev­el if China’s week­end PMI data shows the recov­ery is gain­ing steam.

Gold

Gold prices are waver­ing as some hot wage data will like­ly keep the pres­sure on the Fed. Wall Street is con­fi­dent the Fed will raise rates next week, but it seems these lat­est infla­tion pres­sures may not allow them to sig­nal they are ready for a pause.  The last few key data points lead­ing up to the Fed could sug­gest the ser­vice sec­tor is still healthy and that man­u­fac­tur­ing activ­i­ty is stabilizing. 

The bank­ing cri­sis isn’t over but it appears it won’t lead to a sys­temic prob­lem that will crip­ple the US econ­o­my.  Gold prob­a­bly won’t be ben­e­fit­ting that much from safe-haven flows on bank­ing jit­ters but it should ral­ly if the Fed is com­fort­able enough to sig­nal­ing they are read­ing to hold rates for a while. Mon­e­tary pol­i­cy is restric­tive and as it fil­ters through the sys­tem, we will start to see larg­er parts of the econ­o­my enter slow­down mode. 

Cryp­tos

The cryp­to mar­ket is strug­gling for a fresh cat­a­lyst as the bank­ing cri­sis looks like it might very well end with First Repub­lic Bank.  The Fed will pro­tect the banks and that should mean the recent trend of cryp­to strength on bank­ing woes is com­ing to an end. Bit­coin isn’t get­ting a boost despite an upbeat mood on Wall Street as many traders remain in wait-and-see mode over US cryp­to regulation. 

The Con­sen­sus 2023, a key gath­er­ing of cryp­to insid­ers, drew atten­tion to the need for coor­di­nat­ed reg­u­la­to­ry clar­i­ty with cryptos. 

Con­tent is for gen­er­al infor­ma­tion pur­pos­es only. It is not invest­ment advice or a solu­tion to buy or sell secu­ri­ties. Opin­ions are the authors; not nec­es­sar­i­ly that of OANDA Busi­ness Infor­ma­tion & Ser­vices, Inc. or any of its affil­i­ates, sub­sidiaries, offi­cers or direc­tors. If you would like to repro­duce or redis­trib­ute any of the con­tent found on Mar­ket­Pulse, an award win­ning forex, com­modi­ties and glob­al indices analy­sis and news site ser­vice pro­duced by OANDA Busi­ness Infor­ma­tion & Ser­vices, Inc., please access the RSS feed or con­tact us at info@marketpulse.com. Vis­it https://www.marketpulse.com/ to find out more about the beat of the glob­al mar­kets. © 2023 OANDA Busi­ness Infor­ma­tion & Ser­vices Inc. 

With more than 20 years’ trad­ing expe­ri­ence, Ed Moya is a senior mar­ket ana­lyst with OANDA, pro­duc­ing up-to-the-minute inter­mar­ket analy­sis, cov­er­age of geopo­lit­i­cal events, cen­tral bank poli­cies and mar­ket reac­tion to cor­po­rate news. His par­tic­u­lar exper­tise lies across a wide range of asset class­es includ­ing FX, com­modi­ties, fixed income, stocks and cryptocurrencies. 

Over the course of his career, Ed has worked with some of the lead­ing forex bro­ker­ages, research teams and news depart­ments on Wall Street includ­ing Glob­al Forex Trad­ing, FX Solu­tions and Trad­ing Advan­tage. Most recent­ly he worked with TradeTheNews.com, where he pro­vid­ed mar­ket analy­sis on eco­nom­ic data and cor­po­rate news. 

Based in New York, Ed is a reg­u­lar guest on sev­er­al major finan­cial tele­vi­sion net­works includ­ing CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Busi­ness and Sky TV. His views are trust­ed by the world’s most renowned glob­al newswires includ­ing Reuters, Bloomberg and the Asso­ci­at­ed Press, and he is reg­u­lar­ly quot­ed in lead­ing pub­li­ca­tions such as MSN, Mar­ket­Watch, Forbes, Bre­it­bart, The New York Times and The Wall Street Journal. 

Ed holds a BA in Eco­nom­ics from Rut­gers University.