Gold
On Monday, multiple bullish factors drove gold prices to a two-week high of $2,676.31 per ounce. News that the People’s Bank of China (PBOC) resumed gold purchases after a six-month pause, coupled with rising market expectations for a US Federal Reserve rate cut next week, bolstered bullish sentiment.
Safe-haven demand also supported gold prices. By the close of trading, gold had risen 1.04%, settling at $2,660.30 per ounce.
According to Caixin, China’s State Administration of Foreign Exchange reported that the PBOC bought 160,000 ounces (approximately 4.54 tons) of gold in November, increasing its total holdings to 72.96 million ounces (about 2,068.38 tons). This marked a resumption of gold purchases after a six-month pause.
Bart Melek, Head of Commodity Strategy at TD Securities, stated, “The key factor is the news that the People’s Bank of China has resumed gold purchases. The market is now hoping that other central banks will follow suit, possibly leading to a resurgence of record-breaking buying.”
Global central bank monetary easing prospects also supported the rise in gold prices. Following the release of November’s US non-farm payroll data last Friday, traders increased their bets on a Federal Reserve rate cut next week.
Additionally, market consensus points to the European Central Bank (ECB) cutting rates by 25 basis points this Thursday for the fourth time this year, with expectations for further cuts in the future. The Swiss National Bank and the Bank of Canada are also expected to lower interest rates this week.
Geopolitical factors also drove safe-haven demand for gold. Unrest in Syria following the overthrow of President Bashar al-Assad heightened market concerns over regional instability. Reports from Syrian rebel forces indicated that they had seized control of the government, ending the Assad family’s 50-year rule.
For today’s trading, investors should keep an eye on Australia’s Reserve Bank interest rate decision for December 10, the US NFIB Small Business Optimism Index for November, and geopolitical developments in the Middle East.
Gold Technical Analysis:
On Monday, gold experienced moderate upward momentum during the Asian session, briefly surpassing the $2,650 resistance before retreating into a consolidation phase.
The European session saw a second test of support at $2,634, after which gold experienced a sharp rally. The rally accelerated in the US session, with gold breaching the $2,670 level and peaking at $2,676 before pulling back slightly for a strong close.
The daily K-line chart shows a bullish breakout with a strong upward candlestick, indicating a potential continuation of the uptrend after two weeks of choppy sideways movement.
Today’s Focus:
Today’s trading strategy suggests a preference for buying on dips and shorting on rebounds.
- Upside resistance: $2,675 – $2,680
- Downside support: $2,650 – $2,645
Oil
On Monday, crude oil prices surged over 1%, fueled by China’s decision to reintroduce an “appropriately loose” monetary policy to stimulate economic growth.
Additional support came from heightened geopolitical uncertainty following the ousting of Syrian President Bashar al-Assad.
By the end of the session, WTI January crude oil futures rose $1.17, or about 1.74%, to close at $68.37 per barrel, while Brent February crude oil futures increased by $1.02, or 1.43%, to settle at $72.14 per barrel.
According to CCTV, the Central Committee of the Communist Party of China held a meeting on December 9, where it emphasized the need for “more proactive fiscal policies and an appropriately loose monetary policy.” The goal is to enhance policy coordination, strengthen counter-cyclical measures, and maintain forward-looking, targeted, and effective macroeconomic management.
Geopolitical tensions in the Middle East also fueled oil’s rally. Jorge Leon, Head of Geopolitical Analysis at Rystad Energy, stated, “The events in Syria over the weekend could have repercussions on the oil market, particularly if the broader Middle East region becomes more unstable, which could raise the geopolitical risk premium in oil prices over the coming weeks and months.”
According to Global Times, on December 8, Syrian opposition forces announced they had entered the capital, Damascus, and later declared on television that they had “toppled the Assad regime.” Russian media also reported that Bashar al-Assad and his family had fled to Russia.
On the same day, Russia’s Ministry of Foreign Affairs announced that following negotiations with all factions involved in the conflict, Assad had agreed to step down as president and leave Syria.
The market also focused on the balance of supply and demand in the oil market. Goldman Sachs maintained its forecast for Brent crude to average $76 per barrel in 2025, predicting that OPEC+ production cuts would offset the surge in oil inventories from OECD countries.
Morgan Stanley and HSBC revised their forecasts upward, raising their Brent crude estimates to $70 per barrel due to OPEC+’s decision to delay production increases. Conversely, Citibank issued a more pessimistic outlook, warning that a supply glut could push oil prices to $60 per barrel or lower by mid-2025.
For today’s trading, investors should keep a close watch on geopolitical developments in the Middle East and monitor US API crude oil inventory data for the week ending December 6.
Oil Technical Analysis:
On Monday, oil prices experienced steady gains. The WTI crude oil price found support at $67.50 and began a gradual recovery.
In the US session, prices surged, briefly breaching the $68.80 level before retreating to close at $68.37. The daily K-line chart shows a modest bullish candlestick, indicating continued upward momentum.
However, the overall price movement remains within a narrow sideways trading range as market participants assess supply and demand.
Today’s Focus:
Today’s trading strategy suggests a preference for shorting on rebounds and buying on dips.
- Upside resistance: $69.20 – $69.70
- Downside support: $67.00 – $66.50
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Disclaimer
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
The above strategies reflect only the analysts’ opinions and are for reference only. They should not be used or considered as the basis for any trading decisions or as an invitation to engage in any transaction. Doo Prime does not guarantee the accuracy or completeness of this report and assumes no responsibility for any losses resulting from the use of this report. Do not rely on this report to replace your independent judgment. The market is risky, and investments should be made with caution.
