POWER: Italy’s Pun to Drop on Lower Demand Amid Holiday

• RES 4: $3106.8 - 2.764 proj of the Nov 14 - Dec 12 - 19 price swing    
• RES 3: $3100.0 - Round number resistance 
• RES 2: $3079.2 - 2.618 proj of the Nov 14 - Dec 12 - 19 price swing
• RES 1: $3057.5 - High Mar 20 
• PRICE: $3013.8 @ 07:25 GMT Mar 24 
• SUP 1: $2999.5 - Low Mar 18 
• SUP 2: $2964.9/2884.4 - 20-day EMA / 50-day EMA
• SUP 3: $2832.7 - Low Feb 28 and key support
• SUP 4: $2758.3 - Low Jan 30

A clear uptrend in Gold remains intact and last week’s resumption of the bull cycle reinforces current conditions. The yellow metal is holding on to the bulk of its recent gains. Last Thursday’s fresh trend high reinforces the bull theme and sights are on $3079.2 next, a Fibonacci projection. Note that moving average studies are in a bull-mode position, highlighting a dominant uptrend and positive market sentiment. Support is at $2964.9, the 20-day EMA.

• RES 4: $79.98 -  High Jan 15 and a reversal trigger  
• RES 3: $76.78 - High Feb 11 and a bull trigger 
• RES 2: $74.76 - High Feb 25
• RES 1: $73.17 - High Mar 24           
• PRICE: $73.12 @ 07:09 GMT Mar 25   
• SUP 1: $68.33 - Low Mar 5 and the bear trigger  
• SUP 2: $67.87 - Low Sep 10 ‘24 and a key medium-term support
• SUP 3: $66.36 1.618 proj of the Jan 15 - Feb 4 - 11 price swing
• SUP 4: $63.90 2.000 proj of the Jan 15 - Feb 4 - 11 price swing

Brent futures traded higher Monday and the contract is holding on to its recent highs. For now, gains are considered corrective. However, price has breached the 50-day EMA, at $72.83. A clear break of this average would signal scope for a stronger recovery and open $74.76 next, the Feb 25 high. Moving average studies remain in a bear-mode position highlighting a dominant downtrend. The bear trigger lies at $68.33, the Mar 5 low.

The Swedish price index for domestic supply pulled back to 2.8% Y/Y in February (vs 3.6% prior). However, this masked diverging trends between domestic producer prices and import prices. Domestic producer price inflation accelerated for the third consecutive month to 4.8% Y/Y (vs 2.5% prior), while import price inflation eased to 1.2% Y/Y (vs 4.8% prior). The latter’s development is likely a function of the stronger krona in February. Producer price inflation (which takes into account domestic producer prices and export prices) eased a tenth to 3.4% Y/Y.

• The Riksbank will need to see further easing in “core” domestic supply pressures in the coming months to feel confident that the recent uptick in CPI inflation is temporary. Rate cuts appear off the table until this view is confirmed.
• Energy inflation (in the price index for domestic supply) ticked up to 4.0% Y/Y (vs -1.0% prior), the highest rate since January 2023. This came as an acceleration in domestic electricity prices (to 23.5% Y/Y) was offset somewhat by lower imported crude oil prices.
• Excluding energy, domestic supply inflation was 2.7% Y/Y (vs 4.7% prior), with pullbacks noted in capital goods, consumer goods and food.
• Food inflation has been a key driver of higher CPI outturns in 2025, so further deceleration in producer prices (and survey expected price data) will be required to ease Riksbank concerns for this category.
• On a 3m/3m (NSA) basis, inflation momentum remained strong across components.