Once this news came out, $XAU and $CL pretty much got locked in their direction. Once geopolitical tensions heat up, risk-averse funds rush into gold. $XAU is currently at the 4495 level—up +2.81% today—and there’s still more to play.
$CL also followed through, reaching 86.69. Oil is exactly the kind of instrument that feeds on this kind of uncertainty—once anything goes awry on the supply side, the price reacts faster than anyone else.
That said, I don’t think this current move will end that quickly. In political games like this, the more sensitive the topic, the longer the tug-of-war lasts. What the market is pricing in right now is only the “possibility of something going wrong.” Once it actually materializes, there’s still room for both gold and oil.
Anyway, I don’t short this kind of macro/news-driven product—going against the trend is pointless.
#Gold
$CL also followed through, reaching 86.69. Oil is exactly the kind of instrument that feeds on this kind of uncertainty—once anything goes awry on the supply side, the price reacts faster than anyone else.
That said, I don’t think this current move will end that quickly. In political games like this, the more sensitive the topic, the longer the tug-of-war lasts. What the market is pricing in right now is only the “possibility of something going wrong.” Once it actually materializes, there’s still room for both gold and oil.
Anyway, I don’t short this kind of macro/news-driven product—going against the trend is pointless.
#Gold