. Daily Commodity Analysis - China's Surge Sparks Unprecedented Oil and Gold Rally!

Daily Commodity Analysis – China’s Surge Sparks Unprecedented Oil and Gold Rally!

Daily Commodity Analysis – China’s Surge Sparks Unprecedented Oil and Gold Rally!

15 Nov 2023

Introduction:

Commodity markets witnessed positive trends as oil prices surged on robust China economic data and an optimistic demand forecast. Meanwhile, gold prices rose amid eased Federal Reserve concerns, driven by subdued inflation data. Copper also experienced an upswing, fuelled by increased liquidity in China and positive economic indicators. In the precious metals market, silver (XAG/USD) is poised to surpass $23.20, reflecting indications that the Federal Reserve has concluded its interest rate hikes.

Brent Crude Oil:

Oil gains on China economic data, strong demand forecast.

Wednesday witnessed an increase in oil prices following better-than-expected performance in China’s factory output and retail sales. This positive momentum came on the heels of the International Energy Agency (IEA) revising its oil demand growth forecast for the current year.

In October, China’s economic activity showed improvement with accelerated growth in industrial output and retail sales surpassing expectations. This positive development serves as an encouraging indicator for the world’s second-largest economy.

The (IEA) anticipates sustained robustness in oil demand, and it revised its forecast upwards owing to stronger-than-expected consumption in China, as noted by ANZ Research on Wednesday.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 82.22| Negative Crossover | Bearish
  • MA 20: 82.31| Negative Crossover | Bearish
  • MA 50: 84.17| Negative Crossover | Bearish

Simple:

  • MA 5: 82.42| Negative Crossover | Bearish
  • MA 20: 81.5| Positive Crossover | Bullish
  • MA 50: 84.72| Negative Crossover | Bearish

RSI (Relative Strength Index): 44.8| Neutral Zone | Neutral

Stochastic Oscillator: 88.28| Buy Zone | Negative

Resistance And Support Levels:

  • R1: 84.84 | R2: 87.81
  • S1: 82.03| S2: 78.17

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 80.91 | Take Profit: 78.17 | Stop Loss: 82.91.

GOLD:

Gold price rises as Fed fears ease.

Wednesday witnessed an increase in gold prices driven by subdued inflation data, leading to speculation that the Federal Reserve might cease its interest rate hikes. Simultaneously, copper prices saw a rise fuelled by optimism surrounding signs of economic resilience in China.

The precious metal continued its upward trend following its most significant intraday surge in over three weeks on Tuesday. This surge was attributed to a substantial decline in the dollar and Treasury yields, driven by the prospect of the Federal Reserve refraining from further interest rate hikes.

Gold prices experienced significant declines in the past week, attributed to a reduction in safe-haven demand amid diminishing concerns about the Israel-Hamas conflict.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1961.69 | Positive Crossover | Bullish
  • MA 20: 1957.99 | Positive Crossover | Bullish
  • MA 50: 1960.51 | Positive Crossover | Bullish

Simple:

  • MA 5: 1959.80 | Positive Crossover | Bullish
  • MA 20: 1953.43 | Positive Crossover | Bullish
  • MA 50: 1974.24 | Negative Crossover | Bearish

RSI (Relative Strength Index): 57.09 | Buy Zone | Bullish

Stochastic Oscillator: 100| Buy Zone | Positive

Resistance And Support Levels:

  • R1: 1974.18 | R2: 2003.02
  • S1: 1952.90| S2: 1926.81

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion:  Stop Buy: 1981.05 | Take Profit: 2003.02 | Stop Loss: 1968.69.

Elsewhere In the Commodity Market.

Copper experiences an upswing fueled by increased liquidity in China and positive data. XAG/USD is looking towards a level above $23.20, with indications that the Federal Reserve has concluded its interest rate hikes.

Gold up (0.43%) at 1971.38, Silver up (0.85%) at 23.27, Palladium up (0.74%) at 1023.63, Platinum up (0.31%) at 888.24, Brent Crude Oil down (0.04%) at 82.44, WTI Crude Oil down (0.20%) at 78.17 as of writing time.

Key Economic Events & Data Release Today:

(JPY) GDP (QoQ) (Q3) Actual –0.5%, Forecast –0.1%, Previous1.2% at 05:20.

(CNY) Industrial Production (YoY) (Oct) Actual 4.6%, Forecast 4.4%, Previous 4.5% at 07:30.

(GBP) CPI (YoY) (Oct) Actual 4.6%, Forecast 4.8%, Previous 6.7% at 12:30.

(USD) Core Retail Sales (MoM) (Oct) Forecast –0.2%, Previous 0.6% at 19:00.

(USD) Retail Sales (MoM) (Oct) Forecast –0.3%, Previous 0.7% at 19:00.

(USD) PPI (MoM) (Oct) Forecast 0.1%, Previous 0.5% at 19:00.