. Daily Commodity Analysis - Gas Futures Cautious, Gold Prices Rally Before Powell's Speech.

Daily Commodity Analysis – Gas Futures Cautious, Gold Prices Rally Before Powell’s Speech.

Daily Commodity Analysis – Gas Futures Cautious, Gold Prices Rally Before Powell’s Speech.

25 Oct 2023

Introduction:

In the natural gas market, a further rebound appears unlikely as traders reduced their open interest and trading volume, signalling potential challenges for significant gains. Meanwhile, in the gold market, prices are cautiously responding to various factors, and we’re closely watching Fed Chair Powell’s upcoming speech. While gold experienced a slight uptick, it remains in a range, with key levels to watch. In the broader commodity market, silver (XAG/USD) faces a third consecutive day of decline, and oil is pressured by economic worries despite Middle East supply concerns.

Natural Gas:

Natural Gas further rebound looks unlikely.

According to preliminary data from CME Group, traders trimmed their open interest in natural gas futures by a modest 531 contracts on Tuesday, ending an eight-day streak of increasing positions. Concurrently, trading volume followed the same pattern, decreasing by approximately 9.7K contracts compared to the previous day.

The rise in natural gas prices on Tuesday occurred alongside declining open interest and trading volume, suggesting that further significant gains in the immediate future may not be in favour. Currently, the noteworthy resistance level for the commodity remains at around $3.50 per MMBtu.

Technical Overview :

Moving Averages:

Exponential:

  • MA 5: 3.311| Positive Crossover | Bullish
  • MA 20: 3.171| Positive Crossover | Bullish
  • MA 50: 3.121| Positive Crossover | Bullish

Simple:

  • MA 5: 3.322| Positive Crossover | Bullish
  • MA 20: 3.095| Positive Crossover | Bullish
  • MA 50: 3.076| Positive Crossover | Bullish

RSI (Relative Strength Index): 71.17 | Buy Zone | Bullish

Stochastic Oscillator: 92.63| Buy Zone | Neutral

Resistance And Support Levels:

  • R1: 2.986 | R2: 3.208
  • S1: 2.857| S2: 2.697

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 3.031 | Take Profit: 3.208 | Stop Loss: 2.927.

Gold:

Gold remains confined in a range as traders keenly await Fed Chair Powell`s speech.

Gold prices draw some purchasing interest on Wednesday but face challenges in fully capitalizing on the upward movement.

On Wednesday, the price of gold (XAU/USD) experienced a modest uptick, distancing itself from the weekly low it reached around the $1,954-1,953 range the day before. During the first half of the European session, this valuable metal has been able to maintain its position above the $1,970 mark.

The decline in US Treasury bond yields, combined with lingering geopolitical concerns, is drawing the attention of potential buyers to the gold price. This is also keeping the US Dollar (USD) in a defensive position against bullish pressures.

Technical Overview :

Moving Averages:

Exponential:

  • MA 5: 1970.93 | Negative Crossover | Bearish
  • MA 20: 1959.55 | Positive Crossover | Bullish
  • MA 50: 1928.72 | Positive Crossover | Bullish

Simple:

  • MA 5: 1970.61 | Negative Crossover | Bearish
  • MA 20: 1965.31 | Positive Crossover | Bullish
  • MA 50: 1906.68 | Positive Crossover | Bullish

RSI (Relative Strength Index): 63.54 | Buy Zone | Bullish

Stochastic Oscillator: 13.24| Sell Zone | Positive

Resistance And Support Levels:

  • R1: 1975.93 | R2: 2016.38
  • S1: 1948.96| S2: 1912.36

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy : 1983.63 | Take Profit: 2016.38 | Stop Loss: 1962.44.

Elsewhere In the Commodity Market.

XAG/USD drifts into negative territory for the third straight day on Wednesday. Oil dips as economic concerns offset Middle East supply worries.

Gold up (0.01%) at 1970.84, Silver down (0.76%) at 22.75, Palladium down (0.36%) at 1115.50, Platinum down (0.57%) at 879.00, Brent Crude Oil up (0.26%) at 88.30, WTI Crude Oil up (0.05%) at 83.78 as of writing time.

Key Economic Events & Data Release Today:

(USD) Crude Oil Inventories Forecast 0.239M, Previous –4.491M at 20:00.

(EUR) ECB president Lagarde Speaks at 22:30