Oil rebounds on weaker dollar, Gold wavers, Bitcoin off two-month lows

• Oil falls $10 since beginning of the year
• Gold steadies after three-day drop
• Crypto ETFs see $163 million in net outflows in the past month

Oil

Crude prices pared gains after a disappointing Empire State manufacturing report showed the Fed’s aggressive rate hiking campaign is starting to really knock down the economy.  Turkey’s Ceyhan port has yet to resume flows with Baghdad, and government approval might take longer given the lack of clarity with the presidential election. 

The dollar rally has taken a break and that should provide some relief for crude prices, but if the economy shows further signs that growth is plunging, oil prices could remain heavy. 

Gold

Gold might be ready to make another run to record high territory as investors should be prepared for debt limit talks to hit several major roadblocks.  The US economy is also showing signs it is starting to feel the impact of the Fed’s rate hiking campaign after the Empire Manufacturing survey plunged. 

What might complicate gold’s gains is if stagflation signs grow and the risks of more Fed tightening get justified.  Over the short-term, gold still looks attractive given all the uncertainty with US default risks. 

Bitcoin

After falling to a two-month low, Bitcoin found support after tentatively falling below the $26,000 level.  Upcoming debt ceiling talks will tell us a lot if investors believe Bitcoin can behave more of a safe-haven despite all the regulatory uncertainty. 

Bitcoin seems poised to stay in a range, but if risk aversion triggers a de-risking moment, we could see selling pressure extend below last week’s low.    

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