. Daily Commodity Analysis - Gold Rises on Positive China Data

Daily Commodity Analysis – Gold Rises on Positive China Data

Daily Commodity Analysis – Gold Rises on Positive China Data

17 May 2024

Introduction

Gold price rises on positive data from China, the world’s top consumer. Mixed economic signals from China cloud the outlook for copper. Oil extends gains on expectations of Fed rate cuts and lower US crude inventories. Natural gas futures climb as storage injection falls short.

Markets In Focus Today – GOLD

Gold edges higher on strong China data.

Gold ticks higher on Friday after strong data from China, the nation with the greatest demand for Gold. XAU/USD is in a short-term uptrend and may start climbing again after pulling back. Gold price (XAU/USD) is trading three-tenths of a percent higher on Friday, in the $2,380s, helped by positive data from China that brightened the prospects for the country with the world’s largest market for Gold. In the US, meanwhile, a raft of secondary data released on Thursday came out mixed and Federal Reserve (Fed) officials repeated their mantra that inflation was still not coming down fast enough to contemplate cutting interest rates, with an overall neutralizing effect on Gold price. Gold had been rallying after cooler US inflation data and weak US Retail Sales released on Wednesday suggested the Fed might be closer to cutting interest rates than previously thought. The expectation of lower interest rates increases the attractiveness of non-yielding Gold to investors.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2356.9657 | Positive Crossover | Bullish
  • MA 20 : 2340.7900 | Positive Crossover | Bullish
  • MA 50 : 2282.9361 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2349.4617 | Positive Crossover | Bullish
  • MA 20 : 2333.5972 | Positive Crossover | Bullish
  • MA 50 : 2288.8935 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 62.1945 | Buy Zone | Bullish

Stochastic   Oscillator : 62.45 | Buy Zone | Negative

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 : 2373.78 | Take Profit : 2397.67 | Stop Loss : 2359.55

COPPER

Copper mixed amid middling China cues.

Among industrial metals, one-month copper futures tumbled from two-year highs tracking middling economic data. But three-month copper futures pushed higher and were set for a stellar week as markets bet on tighter supplies and an eventual demand recovery in the coming months. Data from China on Friday painted a mixed picture of the economy. While industrial production grew more than expected, retail sales growth slowed and house prices shrank at an accelerated pace. Growth in Chinese fixed asset investment also slowed. The readings presented a muddled outlook for the world’s biggest copper importer, as it rolled out more stimulus measures to shore up growth. Three-month copper futures gained on the prospect of a demand recovery, and were up nearly 4% this week. They were also at two-year highs.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 4.900 | Positive Crossover | Bullish
  • MA 20 : 4.832 | Positive Crossover | Bullish
  • MA 50 : 4.685 | Positive Crossover | Bullish

Simple :

  • MA 10 : 4.942 | Negative Crossover | Bearish
  • MA 20 : 4.811 | Positive Crossover | Bullish
  • MA 50 : 4.663 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 61.31 | Buy Zone | Bullish

Stochastic   Oscillator : 3.14 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 4.957 R2 : 5.175
  • S1 : 4.766 S2 : 4.590

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 4.84 | Take Profit : 5.08 | Stop Loss : 4.69

CRUDE OIL

WTI extends the rally near $78.90, US inflation data boosts Fed rate cut expectations.

WTI prices gains traction near $78.90 on Friday.The softer US April inflation data, Fed rate cut expectations, and a drop in US crude inventories boost the black gold. The ongoing geopolitical risks in the Middle East might cap the downside of WTI prices. Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $78.90 on Friday. The black gold edges higher amid the recent drop in US crude inventories and the possible interest rate cuts by the Federal Reserve (Fed). The recent US CPI inflation report this week showed that US inflation eased slightly in April, prompting the expectation of interest rate cuts from the US Fed in September. This, in turn, weighs on the US Dollar (USD) and benefits USD-denominated oil as lower interest rates help stimulate the economy, which can boost crude oil demand. About the data, a decline in oil inventories lifted the black gold. Crude inventories in the US for the week ending May 3 fell by 2.5 million barrels to 457 million barrels, from 1.36 million barrels drawn in the previous week, according to the Energy Information Administration (EIA). The market consensus projected that stocks would decrease by 1.35 million barrels.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 79.2439 | Negative Crossover | Bearish
  • MA 20 : 80.0937 | Negative Crossover | Bearish
  • MA 50 : 80.6322 | Negative Crossover | Bearish

Simple :

  • MA 10 : 78.8870 | Positive Crossover | Bullish
  • MA 20 : 80.2467 | Negative Crossover | Bearish
  • MA 50 : 81.8934 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 43.2128 | Neutral Zone | Neutral

Stochastic   Oscillator : 79.34 | Sell Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Stop Sell : 78.45 | Take Profit : 76.65 | Stop Loss : 79.84

NATURAL GAS

Natural Gas Futures Add to Gains as Market Balances, Cash Varies .

Natural gas futures soared amid rising demand and the release of the latest storage data outlining an injection that was a bullish miss against expectations and historical averages. U.S. natural gas futures extend gains as a smaller-than-expected increase in inventories last week reduced the storage surplus, the EIA reports. Natural gas in underground storage increased by 70 billion cubic feet to 2,633 Bcf as of May 10, which was 620 Bcf or 31% above the five-year average for the week, according to the data. The week before the surplus was 33% above average. Traders have shifted their positions from net short to net long, reflecting growing bullish sentiment. Despite the current oversupply, the upward revision in demand projections and increased LNG export capacity are likely to sustain the bullish trend in natural gas futures.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.2051 | Positive Crossover | Bullish
  • MA 20 : 2.0664 | Positive Crossover | Bullish
  • MA 50 : 1.9502 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.1948 | Positive Crossover | Bullish
  • MA 20 : 2.0049 | Positive Crossover | Bullish
  • MA 50 : 1.8230 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 74.6509 | 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 : 2.41 | Take Profit : 2.66 | Stop Loss : 2.27

Elsewhere In The Commodity Market

Gold up (0.42%) at 2386.33, Silver up (0.36%) at 29.67, Palladium down (0.86%) at 980.76, Platinum down (0.07%) at 1056.29, Brent Crude Oil down (0.06%) at 83.31, WTI Crude Oil up (0.2%) at 78.83 as of writing time.

Key Economic Events & Data Release Today:

(CNY) Industrial Production (YoY) (Apr) Forecast 5.5%, Previous 4.5% at 07:30. (EUR) CPI (YoY) (Apr) Forecast 2.4%, Previous 2.4% at 14:30.