The compliance rate OPEC+ agreement was 108% | 17 July 2020

XAUUSD:

Good and bad news for gold. The renewed lockdowns following a surge in COVID-19 cases in the United States and elsewhere could suppress fuel demand. More than 70,500 new COVID-19 cases were reported in the United States on weekends setting a daily record, with Americans being told to take new precautions. This is a positive signal for gold! A bullish rally on the U.S. stock market will negatively affect the value of the precious metal. The Federal Reserve and the US Treasury are implementing incentive programs that have a positive impact on the value of corporate shares.

Trading recommendation: range 1790 -1815.

#WTI:

We are expecting a bullish rally in the oil market in the new five-day period. Production of OPEC+ countries in June decreased by almost 2 mln bpd compared to the previous month and reached 33.4 mln bpd. The agreement to reduce oil production this month saw 108% compliance against 89% a month earlier, according to the July report of the International Energy Agency. “On the supply side, global oil production fell sharply in June to stand 13.7 mb/d below the April level. The compliance rate with the OPEC+ supply agreement was 108%. This includes overperformance by Saudi Arabia which cut production by 1 mb/d more than required, reducing OPEC crude output to its lowest point in nearly three decades. This solid performance by the OPEC+ group has been supplemented by substantial market-driven cuts, mainly in the United States,” the report said.

Trading recommendation: Buy 40.00 and take profit 41.38

#SP500:

U.S. producer prices unexpectedly fell in June as rising costs for energy goods were offset by weakness in services, pointing to subdued inflation that should allow the Federal Reserve to keep pumping money into the economy. The Federal Reserve and the US Treasury are implementing incentive programs that have a positive impact on the value of corporate shares. The Federal Reserve tracks the core personal consumption expenditures price index for its 2% inflation target. The core PCE price index increased 1.0% on a year-on-year basis in May, the smallest advance since December 2010.

Trading recommendation: Buy 3194 and take profit 3216