S&P 500 futures are gaining some ground in premarket trading as traders stay ready to buy stocks near all-time high levels.
The yield of 10-year Treasuries has recently managed to get back above 1.65% and is slowly moving towards recent highs near 1.70% level. Meanwhile, the U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, gained upside momentum and managed to settle above the 20 EMA at 93.80.
Interestingly, higher yields and stronger dollar failed to put any pressure on stocks, and stock traders remain confident that Fed will not hurt markets when it announces its Interest Rate Decision on November 3, 2021.
WTI Oil Tests The $85 Level
WTI oil managed to settle above the $84 level and is testing the psychologically important resistance level at $85. The market remains worried about potential energy shortage ahead of winter in the Northern Hemisphere, and these worries are pushing oil to new highs.
RSI for WTI oil is in the overbought territory so the risks of a pullback are increasing, but oil traders do not look worried as fundamentals are favorable while the current upside trend is very strong. A move above the $85 level will signal that WTI oil will try to settle in the $85 – $90 range, which will be bullish for oil-related stocks.
Gold Gets Back Above The $1800 Level Despite Strong Dollar And Rising Yields
Gold continues its attempts to settle above the resistance at the $1800 level despite the strength of the American currency and rising Treasury yields.
Gold and U.S. dollar are moving higher together, which means that traders are worried about inflation. These worries are understandable as oil has recently moved to new highs, and higher energy prices will inevitably contribute to inflation around the world.
Gold mining stocks gained strong upside momentum after touching yearly lows in early September, and they look ready to start this week on a strong note.