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Crude Futures Extend Gains, Underpinned By Geopolitical Tensions

COMMODITIES
  • Crude strengthened on the day with WTI set for 9% gains since the start of the week. Additional Middle East geopolitical tensions are outweighing concerns for the demand outlook. Front Month WTI (March 24) is up 1.40% at 79.12$/bbl approaching the close.
  • Today has seen an escalation of tensions between Israel and Iran-backed, Lebanon-based, Hezbollah following an Israeli attack which killed 10 Lebanese civilians this week. In a televised address a short time ago, Hezbollah leader Sayyed Hassan Nasrallah, responding to the attack, said Israel will pay a price "in blood."
  • Key short-term resistance has been defined at $79.29, the Jan 29 high and clearance of this level would be a bullish development.
  • For precious metals, very similar price action for the USD to Thursday has seen similar advances of 0.36% and 2.15% respectively for spot gold and silver.
  • While gold has edged back above its breakout level, a bearish theme does remain intact overall and the yellow metal needs to clear resistance at $2065.5, the Feb 1 high, to reinstate a bullish theme.

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