. Daily Commodity Analysis - Gold Falls, Copper Rallies

Daily Commodity Analysis – Gold Falls, Copper Rallies

Daily Commodity Analysis – Gold Falls, Copper Rallies

21 May 2024

Introduction

Oil prices dropped in Asia on worries about high inflation and interest rates in the US. Investors are concerned these factors will hurt consumer and industrial demand. The Fed’s hawkish stance also weighed on gold prices, while copper continued its record-breaking rally. Natural gas futures rose due to tight supplies and summer demand expectations.

Markets In Focus Today – CRUDE OIL

Oil prices fall on demand fears over Fed’s rates path.

Oil prices extended losses in Asia trade on Tuesday, with investors anticipating lingering U.S. inflation and higher interest rates to depress consumer and industrial demand. Both benchmarks fell less than 1% on Monday as U.S. Federal Reserve officials said they were awaiting more signs of slowing inflation before considering interest rate cuts.Crude Oil prices struggled as investors weighed recent hawkish remarks from the Federal Reserve (Fed) despite last week’s cooling US consumer inflation data. Federal Reserve Vice Chair Michael Barr said on Monday that the Fed is in a good position to hold the policy steady and watch the economy, as per a Reuters report. Investors are focusing on supply from the Organization of the Petroleum Exporting Countries and its affiliates, together known as OPEC+. They are scheduled to meet on June 1 to set output policy, including whether to extend some members’ 2.2 million barrels per day of voluntary cuts.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 79.2854 | Negative Crossover | Bearish
  • MA 20 : 79.9760 | Negative Crossover | Bearish
  • MA 50 : 80.5447 | Negative Crossover | Bearish

Simple :

  • MA 10 : 79.0920 | Negative Crossover | Bearish
  • MA 20 : 79.9255 | Negative Crossover | Bearish
  • MA 50 : 81.9563 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 41.4320 | Neutral Zone | Neutral

Stochastic   Oscillator : 23.26 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 85.9330 R2 : 87.5706
  • S1 : 80.6316 S2 : 78.9940

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 79.01 | Take Profit : 77.07 | Stop Loss : 80.31

NATURAL GAS

Traders Anticipate Heat-Driven Test of 200-Day Moving Average.

Natural gas futures were trending higher , approaching the critical 200-day moving average, a key indicator for long-term trends. Bullish momentum persists as recent inventory data suggests tight supplies ahead of the peak summer season. Last week, natural gas futures hit their highest levels since February, driven by strong market sentiment and a balanced supply-demand outlook. Mixed cash prices and anticipated summer weather boosted demand, while pipeline maintenance offered varied support. Given the current market conditions—reduced storage increases, lower production, and robust LNG exports—natural gas futures are likely to maintain their upward trend in the short term. However, the potential for cooler weather could temper this bullish outlook by decreasing immediate demand for natural gas.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.3751 | Positive Crossover | Bullish
  • MA 20 : 2.1862 | Positive Crossover | Bullish
  • MA 50 : 2.0103 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.3323 | Positive Crossover | Bullish
  • MA 20 : 2.0927 | Positive Crossover | Bullish
  • MA 50 : 1.8622 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 81.0829 | Buy Zone | Bullish

Stochastic   Oscillator : 100.00 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.8667 R2 : 1.9349
  • S1 : 1.6459 S2 : 1.5777

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 2.63 | Take Profit : 2.86 | Stop Loss : 2.49

GOLD

Gold price loses its recovery momentum amid renewed US Dollar demand.

Gold price trades on a weaker note on Tuesday amid the rebound in the USD. Gold price (XAU/USD) loses traction on Tuesday after reaching a record high earlier. The lack of fresh catalysts in a quiet session in terms of top-tier economic data might limit the precious metal’s upside. Nonetheless, the renewed demand by higher bets on interest rate cuts from the US Federal Reserve (Fed), ongoing geopolitical tensions, and the strong demand stemming from central banks and Asian buyers might provide some support to the yellow metal. Gold traders will take more cues from the Fedspeak, with the Fed’s Waller, Williams, Barr, Bostic, Collins, and Mester scheduled to speak later on Tuesday. The FOMC Minutes will be the highlight on Wednesday. Furthermore, the hawkish stance from Fed officials is likely to lift the Greenback and drag the USD-denominated Gold lower.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2381.6383 | Positive Crossover | Bullish
  • MA 20 : 2357.5969 | Positive Crossover | Bullish
  • MA 50 : 2294.6021 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2372.9045 | Positive Crossover | Bullish
  • MA 20 : 2344.7654 | Positive Crossover | Bullish
  • MA 50 : 2299.5198 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 65.5079 | Neutral Zone | Neutral

Stochastic   Oscillator : 87.2188 | Neutral Zone | Neutral

Resistance   And Support Levels :

  • R1 : 2392.8718 R2 : 2440.8082
  • S1 : 2237.6882 S2 : 2189.7518

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 2400.34 | Take Profit : 2437.14 | Stop Loss : 2377.61

COPPER

Copper prices hit record highs.

Copper prices are set to see some near-term volatility after surging to record highs in recent sessions, Morgan Stanley analysts said in a note, although the red metal is still expected to push higher this year. A mix of strong demand-supply fundamentals and outsized speculative trading drove stellar gains in copper over the past few sessions, putting prices at lifetime highs. Bulls expect copper demand to increase in the coming months amid a greater global push into green energy and electrification, and that copper mines will be unable to meet this increased demand. The growing popularity of artificial intelligence, and the industry’s large energy requirement is also expected to drive up copper demand. Copper plays a key role in electricity transmission infrastructure.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 5.03 | Positive Crossover | Bullish
  • MA 20 : 4.97 | Positive Crossover | Bullish
  • MA 50 : 4.80 | Positive Crossover | Bullish

Simple :

  • MA 10 : 5.05 | Positive Crossover | Bullish
  • MA 20 : 4.99 | Positive Crossover | Bullish
  • MA 50 : 4.75 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 60.27 | Buy Zone | Bullish

Stochastic   Oscillator : 17.97 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 5.19 R2 : 5.39
  • S1 : 4.99 S2 : 4.75

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 4.93 | Take Profit : 5.19 | Stop Loss : 4.79

Elsewhere In The Commodity Market

Gold down (0.31%) at 2417.66, Silver down (0.59%) at 31.60, Palladium down (0.16%) at 1025.54, Platinum down (0.76%) at 1041.02, Brent Crude Oil down (0.79%) at 82.96, WTI Crude Oil down (0.62%) at 78.60 as of writing time.

Key Economic Events & Data Release Today:

(AUD) RBA Meeting Minutes at 07:00. (EUR) German PPI (MoM) (Apr) Forecast 0.3%, Previous 0.2% at 11:30. (EUR) ECB President Lagarde Speaks at 13:30. (CAD) CPI (MoM) (Apr) Forecast 0.5%, Previous 0.6% at 18:00. (CAD) Core CPI (MoM) (Apr) Previous 0.5% at 18:00. (GBP) Gov Bailey Speaks at 22:30.