Oil prices have dropped by 6% as investors express optimism about de-escalation in the Middle East. Israel’s recent military response to a missile attack from Iran, which did not target Iranian oil facilities, has contributed to this decline. Meanwhile, gold prices remain strong, and Arabica coffee prices have bounced back from support levels.
Oil Price Drop Driven by Middle East Tensions
Israel’s military action over the weekend, responding to an Iranian missile attack, has led to a significant decrease in West Texas Intermediate (WTI) crude oil prices. The WTI front month futures dropped, with the early October low of $66.22 becoming a focus amid hopes for reduced tensions in the region.
Support levels may emerge near the September low of $64.81, which could help stabilize prices in the coming days. The recent trading activity showed a gap between Friday’s low of $69.93 and Monday’s intraday high of $68.79, with prices holding above the low of $68.22 from October 18.
Gold Prices Consolidate Below Record Highs
Gold prices continue to consolidate below last week’s record high of $2,758.00 per troy ounce. The spot gold price remains in a long-term uptrend, with key resistance above at $3,005.71, which represents the 261.8% Fibonacci extension from previous lows.
The psychological mark of $3,000.00, along with the Fibonacci level, serves as a target for future upside potential, provided the support at $2,605.00 remains intact. Minor support is also visible at last week’s low of $2,709.00, along with the previous all-time high from September at $2,685.00 and the uptrend line from August to October at $2,655.00.
Arabica Coffee Prices Recover from Support
Arabica coffee futures have shown resilience, bouncing back to $243.48, slightly above the early October low of $242.78. The prices are approaching the downtrend line from September to October, currently at $255.70. If prices break above this line, the mid-October high of $263.20 may come into focus.
However, if the support zone between $243.48 and $242.78 fails, attention could shift to the uptrend line for October 2023 to October 2024, which stands at $227.20.
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