[Click on the picture above to watch Murray analyse oil, gold and the S&P 500 after the amazing news of a drone attack on Saudi Arabian oil infrastructure.]
With the startling news over the weekend of an attack on key oil infrastructure in Saudi Arabia, the week has started off with a bang. Whether it turns into a whimper or not remains to be seen.
In my experience these types of news events often see large volatility initially which is then faded. We still don’t know the extent of the damage to their processing facilities and there are apparently satellite images showing quite extensive damage which may take more than a few days to fix, so it is a very fluid situation. But at the end of the day the oil markets are so immense that a situation like this will ultimately be absorbed pretty easily.
There may be a lingering war premium that needs to be built into prices, but worldwide demand and supply will be a larger factor on future prices than a short-term supply disruption.
I show you where I think oil prices could get to on this spike and what to look for once prices have reached their peak, so if you are interested in trading oil just click on the above picture to watch the short presentation.
I also analyse the current situation in gold as a result of the weekly sell pivot that was confirmed last week. There is a chance that prices will correct or at least tread water for a while before resuming the uptrend now that the weekly sell pivot is in place. I give you targets on the current correction as well as a quick analysis of how prices often change direction and where the key opportunities are.
Finally, I have a quick look at the E-mini S&P 500 futures, which have opened weaker on the Saudi Arabian news. If we see a daily sell pivot confirmed by tonight’s price action, I will be getting confident that a sell-off could be around the corner.
Editor, Alpha Wave Trader
PS: Don’t buy gold until you’ve read this report.