WTI Oil Retreats Below The $86 Level On Recession Worries

Key Insights

• WTI oil is losing ground amid a broad sell-off in commodity markets. 
• Precious metals are under pressure as U.S. dollar rebounds after yesterday’s sell-off. 
• Natural gas pulled back towards the support at $6.55.

WTI Oil Is Under Strong Pressure Ahead Of The Weekend

WTI oil declined below the $86 level amid recession worries. The yield of 10-year Treasuries moved back above the 4.00% level, which was bearish for commodity markets.

At this point, it looks that the support provided by OPEC+ production cuts has come to an end. Traders focus on recession risks and expect that higher interest rates will hurt demand for oil. China’s coronavirus policy serves as another bearish catalyst for the oil markets.

Currently, WTI oil is trying to settle below the 20 EMA at $86.50. In case this attempt is successful, it will gain additional downside momentum and move towards the $85 level.

Gold Is Under Pressure As U.S. Dollar Rebounds

Stronger dollar and higher Treasury yields pushed gold closer to the support level at $1640.

The nearest support level for gold is located at $1640. If gold settles below this level, it will move towards the next support at $1615. A successful test of the support at $1615 will open the way to the test of the support at $1600. In case gold declines below the $1600 level, it will head towards the support level at $1575.

On the upside, the previous support at $1660 will serve as the first resistance level for gold. A move above this level will push gold towards the next resistance at $1675. If gold climbs above $1675, it will move towards the resistance at $1690.

Other precious metals have also found themselves under pressure. Silver declined towards $18.20, while palladium pulled back towards the $2000 level. Meanwhile, platinum is trying to settle below the $900 level.

Natural Gas Remains Stuck In The $6.30 – $6.75 Range

Natural gas failed to settle above the $6.75 level and pulled back towards the support at $6.55. Natural gas has settled in the $6.30 – $6.75 range, and it will likely need additional catalysts for a breakout.

It remains to be seen whether natural gas prices may develop additional momentum ahead of the weekend as there are no specific catalysts that could move the market out of the current range.

Copper Lost Momentum After An Unsuccessful Test Of The $3.50 Level

Copper  is moving towards the $3.40 level amid a broad sell-off in commodity markets.

It should be noted that trading in copper markets has been mostly calm this week as traders waited for additional catalysts.

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