. Daily Commodity Analysis - WTI Oil And Natural Gas Decline

Daily Commodity Analysis – WTI Oil And Natural Gas Decline

Daily Commodity Analysis – WTI Oil And Natural Gas Decline

13 Jun 2024

Introduction

Gold faces selling pressure amid a hawkish Fed and modest USD strength, falling in Asian trade on Thursday. Despite a decline in the dollar, gold struggled as the Fed slashed its outlook for rate cuts this year. Broader metal prices also weakened, with copper falling on economic concerns. Meanwhile, WTI oil trades with a mild negative bias, and natural gas futures dip amid regulatory and supply developments.

Markets In Focus Today – GOLD

Gold price faces some selling pressure amid hawkish Fed, modest USD strength.

Gold prices fell in Asian trade on Thursday, remaining close to recent lows as the Federal Reserve slashed its outlook for interest rate cuts this year, presenting more headwinds for the yellow metal. Losses in gold came even as the dollar declined in overnight trade on a softer consumer price index reading. But the greenback steadied on Thursday, as markets digested a more hawkish outlook from the Fed. Gold, precious metals hit by Fed outlook Broader metal prices weakened on Thursday after Fed Chair Jerome Powell said the central bank only expected to cut interest rates once this year, down from prior expectations of three cuts.Gold was also hit by signs that some major central banks, particularly the People’s Bank of China, had ceased buying the yellow metal in May.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2327.6995 | Negative Crossover | Bearish
  • MA 20 : 2335.8377 | Negative Crossover | Bearish
  • MA 50 : 2314.3349 | Negative Crossover | Bearish

Simple :

  • MA 10 : 2329.1758 | Negative Crossover | Bearish
  • MA 20 : 2349.2881 | Negative Crossover | Bearish
  • MA 50 : 2344.7544 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 46.0114 | Neutral Zone | Neutral

Stochastic   Oscillator : 30.4081 | Sell Zone | Neutral

Resistance   And Support Levels :

  • R1 : 2417.4629 R2 : 2458.2274
  • S1 : 2285.4964 S2 : 2244.7319

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 2328.10 | Take Profit : 2295.63 | Stop Loss : 2352.45

COPPER

Copper weakens on dour economic outlook .

Industrial metals also clocked losses on Thursday. Copper prices fell as the prospect of high for longer rates presented a weak outlook for economic activity. Growing concerns over more stimulus measures in top importer China also weighed on sentiment towards copper, as recent economic readings presented a mixed recovery in China’s economy. Benchmark three-month copper futures on the London Metal Exchange fell 1.1% to $9,837.50 a tonne, while one-month copper futures fell 0.5% to $4.5095 a pound.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 4.547 | Positive Crossover | Bullish
  • MA 20 : 4.567 | Negative Crossover | Bearish
  • MA 50 : 4.638 | Negative Crossover | Bearish

Simple :

  • MA 10 : 4.545 | Positive Crossover | Bullish
  • MA 20 : 4.563 | Negative Crossover | Bearish
  • MA 50 : 4.656 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 45.60 | Neutral Zone | Neutral

Stochastic   Oscillator : 72.11 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 4.635 R2 : 4.876
  • S1 : 4.453 S2 : 4.271

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Limit Sell : 4.646 | Take Profit : 4.458 | Stop Loss : 4.796

CRUDE OIL

WTI remains on the back foot below $78.00 mark and two-week top touched on Wednesday.

WTI is undermined by a surprise build in US inventories and lower demand growth forecast by IEA.The Fed’s hawkish surprise lifts the USD and weighs on the dollar-denominated commodity.The lack of strong follow-through selling warrants caution before positioning for deeper losses.West Texas Intermediate (WTI) US crude Oil prices trade with a mild negative bias during the Asian session on Thursday, albeit lack bearish conviction and remain well within the striking distance of a nearly two-week high touched the previous day. Official data published by the Energy Information Administration (EIA) on Wednesday showed that US Crude inventories grew by 3.7 million barrels in the first week of June. Adding to this, the International Energy Agency (EIA), in its monthly report, trimmed the outlook for Oil demand growth in 2024 by 100,000 barrels per day to 960,000 bpd. Apart from this, some follow-through US Dollar (USD) buying, bolstered by the Federal Reserve’s (Fed) hawkish surprise, further seems to undermine USD-denominated commodities, including Crude Oil prices.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 77.2423 | Positive Crossover | Bullish
  • MA 20 : 77.5580 | Positive Crossover | Bullish
  • MA 50 : 78.8012 | Negative Crossover | Bearish

Simple :

  • MA 10 : 76.2306 | Positive Crossover | Bullish
  • MA 20 : 77.3978 | Positive Crossover | Bullish
  • MA 50 : 80.1802 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 51.1547 | Buy Zone | Bullish

Stochastic   Oscillator : 70.9162 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 80.3846 R2 : 81.6628
  • S1 : 76.2468 S2 : 74.9686

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Stop Sell : 77.72 | Take Profit : 75.75 | Stop Loss : 79.33

NATURAL GAS

Natural gas futures fall as traders weigh MVP startup and record heat forecasts.

FERC grants approval for the $7.85 billion MVP pipeline, overcoming regulatory and legal challenges since 2018.EIA data shows a 1% decline in U.S. marketed natural gas production for 2024, driven by price-related reductions in key regions. Traders are currently assessing the implications of the Mountain Valley Pipeline (MVP) startup approval against record heat forecasts. New data from the EIA shows a 1% decline in U.S. marketed natural gas production for 2024, driven by significant reductions in the Haynesville (9%) and Appalachia (4%) regions due to low prices. Given the combined factors of moderate supply growth, regulatory developments, and high summer demand, the outlook for natural gas remains cautiously bullish.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.7520 | Positive Crossover | Bullish
  • MA 20 : 2.6020 | Positive Crossover | Bullish
  • MA 50 : 2.3264 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.6970 | Positive Crossover | Bullish
  • MA 20 : 2.6245 | Positive Crossover | Bullish
  • MA 50 : 2.1817 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 66.5469 | Buy Zone | Bullish

Stochastic   Oscillator : 89.8321 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 2.7527 R2 : 3.0177
  • S1 : 1.8947 S2 : 1.6297

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 2.85 | Take Profit : 3.13 | Stop Loss : 2.68

Elsewhere In The Commodity Market

Gold down (0.37%) at 2315.93, Silver down (1.18%) at 29.32, Palladium down (0.98%) at 897.58, Platinum down (1.02%) at 953.19, Brent Crude Oil down (0.23%) at 82.28, WTI Crude Oil down (0.04%) at 78.21 as of writing time.

Key Economic Events & Data Release Today:

(USD) FOMC Press Conference at 00:00. (AUD) Employment Change (May) Forecast 30.5K, Previous 38.5K at 07:00. (EUR) Industrial Production (MoM) (Apr) Forecast 0.1% Previous 0.6% at 14:30. (USD) PPI (MoM) (May) Forecast 0.1%, Previous 0.5% at 18:00. (USD) Initial Jobless Claims Forecast 225K, Previous 229K at 18:00.