Bullion Moving Closer To $2075.47 Record High

After declining over 4% on Wednesday to be down around 13% on the week on the back of deteriorating risk appetite and recession fears, oil prices slumped early in the APAC session with WTI reaching a low of $63.64. But with risk appetite stabilising oil prices are now off these lows with WTI up 0.5% to $68.95/bbl and Brent +0.7% to $72.85. The USD index is down a further 0.3%.

• Oil prices are off of their intraday highs of $73.32 for Brent and $69.32 for WTI. Brent broke through $72.34, the March 24 low, on Wednesday which has opened up key support at $70.10, the March 20 low.
• It is unclear why WTI oil prices plunged at today’s open and there is speculation that it was due to the unwinding of speculators’ bullish positions, human error, algorithmic selling or panic selling, according to Bloomberg. Trade at that time is usually thin and Bloomberg is reporting that over 3000 June futures contracts changed hands in the fifth minute of the session. Brent didn’t follow the move when it opened a couple of hours later.
• Later the ECB meets (see MNI ECB Preview - May 2023) and is expected to hike rates 25bp. In the US, there are Q1 unit labour costs, March trade and April Challenger job cuts data.