Market Bizzz

The US dollar remained near a two-month high due to safe-haven demand as talks between the White House and the Republicans over raising the US debt ceiling failed to make progress. The issue has raised the risk of the federal government defaulting on its payments as early as 1 June. Investors are avoiding riskier investments as they monitor the outcome of the negotiations. The hawkish rhetoric of Federal Reserve representatives has also buoyed the dollar, with traders anticipating higher interest rates for a more extended period. The minutes of the Fed’s May meeting providing more clues on policy are due to be issued later in the day.

Oil prices rose as U.S. oil and fuel inventories reduced causing speculation over further OPEC+ output cuts. Industry data revealed a decline of 6.8 million barrels in crude inventories in the week to May 19 along with 6.4 million drop in gasoline inventories. Distillate inventories were down 1.8 million. Confirmation of these figures in data from the Energy Information Administration would mean a third straight weekly decline in U.S. gasoline inventories to the lowest levels since 2014 pre-Memorial Day. OPEC+ production cuts are set to take effect this month. However, some investors remain cautious about US debt ceiling discussions.

With just weeks to go before the country runs out of cash, the standoff has become the key topic on trading floors on fears that a US failure to pay its bills will send shockwaves through markets and the global economy.

​Hammer Pattern is a one-day candlestick pattern wherein there is a small green real body and lower shadow extending from the body and is formed at the bottom of a downtrend. ​

Golden Cross is an important technical indicator of bullishness. It occurs when the short-term moving average crosses over the major long-term moving average on the upside.

Gold prices increased slightly on Monday, following a surge of over 1% last week. The rise came after the U.S. Federal Reserve Chair Jerome Powell gave less hawkish comments. The uncertainty over the U.S. debt ceiling outcome and the stability of the banking sector also added to the safe-haven bullion’s boost. At the moment, spot gold is up 0.2% at $1,979.79 per ounce, while U.S. gold futures were steady at $1,981.00.

Oil prices increased slightly on Monday due to a weaker dollar and supply cuts made by Canada and OPEC+ producers. Brent crude futures rose by 0.2% to $75.72 per barrel, and U.S. West Texas Intermediate crude rose 0.2% to $71.84 per barrel. Last week saw gains of around 2% for both oil benchmarks, following Alberta fires, which cut off a significant amount of crude supply in Canada, and voluntary OPEC+ production cuts. A lack of crude supply may threaten the success of a new Nigerian facility, the Dangote Petroleum Refinery, where oil rig counts have reduced in the U.S.

​