Commodity Market Insights: Gold Weakness, Gas Struggles, Oil Strengthens

Overview

1. Gold: Weakness Amid Dollar Strengths

• Gold struggled to hold gains, breaking key support ranges as the U.S. dollar gains traction.
• Currently testing the Weekly Fair Value Gap (FVG) for potential support.
• Bullish Scenario: A breakout above the current range with sustained higher highs and a bullish weekly close.
• Bearish Scenario: A breakdown below the range with a bearish weekly follow-through, closing below the FVG.

2. Gas: Weak Momentum Signals Downside Risks

• Gas closed below 50% of last week’s candle, indicating weak upside momentum.
• Broke below 3.877 and is revisiting the Daily Fair Value Gap, which could act as a support or increase downside risks.
• Bullish Scenario: Price rebounds from the FVG and reclaims higher levels.
• Bearish Scenario: Further breakdown below the FVG, confirming continued weakness.

3. Oil: Strengthening Amid Market Uncertainty

• Oil is forming higher highs and higher lows, indicating an upward trend.
• Strengthening as global tariffs and geopolitical factors drive demand concerns.
• Bullish Scenario: A break above 70.373 to confirm further upside momentum.
• Bearish Scenario: A break below 68.989, with additional downside risk if 68.279 fails to hold.

Market Sentiment & Outlook

• The strong U.S. dollar is weighing on commodities like gold and gas, while oil is showing resilience.
• Geopolitical risks and economic factors will determine whether these assets continue their current trends or reverse.

Gold Struggles as the Dollar Gains Traction

Gold failed to sustain its previous gains, breaking through two key support ranges that were propping up its upside potential. This decline aligns with renewed dollar strength, as the greenback continues to assert dominance in the markets. Currently, gold is testing the Weekly Fair Value Gap, which could determine its next move. Will it regain momentum, or is a further decline inevitable? Let’s analyse the technical and fundamental factors shaping the market.

Weekly

Gold’s decline last week signals a shift in sentiment. The breakdown of key ranges suggests increased pressure from the strengthening U.S. dollar. With the price now hovering around the Weekly Fair Value Gap, this area could serve as a turning point for gold’s next move.

Daily

Daily Outlook

• Gold has lost key support levels, reinforcing bearish momentum.
• The dollar’s strength continues to weigh on gold’s upside potential.
• A close below the Weekly Fair Value Gap may further accelerate the downside.

Gold’s Possible Scenarios This Week

Gold Approaches this Week

4-Hour

Gold is currently consolidating within the Weekly Fair Value Gap. Its next move will depend on whether it can break out of this range.

Bullish Scenario:

• Price breaks above the range and sustains higher highs and lows.
• A bullish weekly candle close to invalidate the downside potential.

Bearish Scenario:

• Price breaks below the current range, confirming further downside.
• Weekly bearish follow-through reinforces downside momentum.
• A close below the Weekly Fair Value Gap signals continued weakness.

As of now, Gold flirts at the weekly fair value gap with price creating a potential range.

GAS: Weekly Bearish Close

Weekly

Gas ended the week with a bearish close, failing to maintain momentum above the 50% retracement of the previous weekly candle. This signals exhaustion in bullish attempts and hints at potential further downside.

Daily

Daily Outlook

• Gas broke below the critical 3.877 level, revisiting a previous Daily Fair Value Gap.
• This move suggests increased downside risk and weak bullish conviction.
• A failed recovery from this level could accelerate further declines.

Gas remains in a vulnerable position, with limited upside momentum unless buyers step in aggressively with an appropriate stimulus emerges this week.

OIL: Creating Higher Highs and Lows for Upside Potential

4-Hour

Oil is showing resilience, with price action forming higher highs and higher lows—a clear sign of bullish strength. Recent tariff developments have supported this upside potential, driving oil prices higher.

Key Scenarios for Oil

Bullish Scenario:

• A confirmed breakout above the 70.373 level could trigger further upside.
• Sustaining a new higher high and low post-breakout.
• Following a breakout range approach to continue the bullish trend.

Bearish Scenario:

• A breakdown below 68.989 could weaken momentum.
• A further break below 68.279 signals deeper downside risk.

The Dollar’s Growing Influence on the Market

As the U.S. dollar continues to gain traction amid economic and geopolitical factors, markets trading against the dollar are experiencing increased volatility. The dollar’s strength is primarily driven by:

• Stronger-than-expected U.S. economic data supporting interest rate expectations.
• Geopolitical risks driving safe-haven demand for the greenback.
• A hawkish Federal Reserve stance reinforcing dollar dominance.

This upward pressure on the dollar is causing a ripple effect across commodity markets, particularly gold and oil, as traders reassess risk exposure.

Final Thoughts

Gold is at a crucial juncture, testing a key technical level that will dictate its next move. Gas struggles with upside momentum, while oil continues to push higher amid global economic shifts. The dollar’s strength remains a dominant force shaping market sentiment.

Traders should watch for confirmations of breakouts or breakdowns in key levels before making their next moves. As market volatility increases, staying informed and agile is key to navigating these dynamic conditions.

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