As was to be expected, it’s been a choppy week so far in financial markets with Europe a very mixed bag on Tuesday while US futures are marginally higher after making marginal losses on Monday.

On the one hand, we could be seeing investors warily waiting for the FOMC minutes and taking in all of the speeches from various Fed officials in the meantime. On the other, this week may just be a void in an otherwise turbulent year thanks to a lack of major catalysts and the US Thanksgiving bank holiday at the end of the week.

Saudi Arabia has gone some way to filling that void, with so much attention now likely to be on the Gulf over the coming weeks. It goes without saying that it came as quite a shock as everything unfolded as it wasn’t what anyone was expecting, quite the opposite in fact. And it could have a major impact on the outcome next month.

But the 2-1 win over one of the tournament favourites, Argentina, was a monumental victory and undoubtedly one of the biggest shocks in World Cup history. It’s blown Group C wide open and cast serious doubt over whether Lionel Messi will ever get his hands on the trophy.

In other news, Saudi Arabia also rejected reports that OPEC+ is considering increasing output on 4 December.

OPEC+ speculation drives oil market volatility

Oil prices are bouncing back as OPEC+ members continue to reject reports of an output hike at the next meeting. An announcement from the G7 around the Russian oil price cap is due any day now and could complicate the group’s mission to balance supply and demand in the market, especially if the Kremlin responds by slashing exports to participating countries, as they’ve threatened.

That Russia is a key member of the alliance seriously complicates matters. I do wonder whether members could consider reconfiguring output targets, rather than boosting them, in order to account for lost Russian crude. Of course, that would likely require the backing of Russia which may not be forthcoming.

Oil prices will likely remain highly volatile over the next couple of weeks against this backdrop, with the EU embargo and potential price cap scheduled to start the day after the OPEC+ meeting on 4 December. If the cap agreement goes to the wire, OPEC+ may opt to delay the meeting given the uncertainty it would generate.

Gold rebounds off the prior resistance level

The slight recovery in risk appetite today is coinciding with a pullback in the US dollar and a rebound in gold. The yellow metal has held onto the bulk of November’s gains over the last week, seeing support around $1,730 on Monday where it met firm resistance on multiple occasions in September and October.

The key level to the upside remains $1,780 where it peaked around last week and saw substantial support around in the first half of the year.

Another dead cat bounce?

Bitcoin is trading higher on Tuesday, but for how long? The knock-on effects of the FTX collapse are still being uncovered, with more names being added to the exposure list every day. Confidence in the markets has been shattered and it may take time to rebuild.

There remains considerable uncertainty around the full consequences of the FTX collapse and as long as that remains the case, any rallies we see in cryptos may simply become dead cat bounces, as opposed to market bottoms. The latest occurred around $15,500, where it rebounded off a couple of weeks ago, and a break of this could trigger another sharp decline.