Gold Overview
On Monday, the dollar weakened significantly, dropping over 1% after President Trump refrained from announcing specific tariff measures on his first day in office. Gold prices moved higher, closing up 0.16% at $2,707.14 per ounce.
During his inauguration speech, Trump declared, “We will impose tariffs and duties on foreign nations to enrich our citizens.” However, he did not provide further details. Reports suggested that while the administration plans to reassess trade relations, immediate tariffs are unlikely.
This ambiguity sent the Bloomberg Dollar Spot Index down 1.1%, marking its steepest one-day drop in 14 months. Analysts noted that the excessive bullish positioning in the dollar post-election contributed to its vulnerability.
Uncertainty surrounding Trump’s policies also bolstered demand for safe-haven assets. UBS analyst Giovanni Staunovo remarked, “Trump’s policies could increase market volatility and longer-term inflation, providing sustained support for gold as a safe-haven asset.”
Technical Outlook for Gold
Gold experienced a deep “V” rebound during the Asian session, finding support near $2,690. After peaking at $2,713 during the European session, it retreated slightly but ultimately closed near $2,710. The daily chart reflects a bullish rebound from $2,690, signaling a double-bottom support formation.
Key Levels to Watch
- Resistance: $2,717–$2,722
- Support: $2,695–$2,690
Crude Oil Overview
Crude oil prices declined as President Trump announced plans to declare a national energy emergency to boost U.S. energy exports and replenish the Strategic Petroleum Reserve. Brent crude for March delivery fell $0.64, or 0.79%, to settle at $80.15 per barrel. U.S. crude did not settle due to the Martin Luther King Jr. holiday.
After taking office, Trump signed an executive order declaring a national energy emergency, aimed at increasing oil and gas output to lower domestic energy costs. Analysts from ANZ Bank cautioned that while new sanctions from the Biden administration have curbed Russian oil supply by nearly 1 million barrels per day, Trump’s potential negotiations on the Russia-Ukraine conflict could ease restrictions.
Severe winter weather across parts of the U.S. offered some support to oil prices. An estimated 70 million people are bracing for extreme cold, particularly in Texas and New Mexico, which could temporarily disrupt North Dakota’s oil production by 125,000–150,000 barrels per day.
Technical Outlook for Crude Oil
Oil faced resistance near $77.7 during the European session before declining sharply in U.S. trading. It broke below the $76 support level, closing near $75.8. The daily chart reflects three consecutive bearish sessions, with crude under pressure near $79.
Key Levels to Watch
- Resistance: $77.6–$78.1
- Support: $75.0–$74.5
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