. Daily Commodity Analysis - Gold Steady, Silver Declines

Daily Commodity Analysis – Gold Steady, Silver Declines

Daily Commodity Analysis – Gold Steady, Silver Declines

31 May 2024

Introduction

Gold prices remained stable in Asian trade on Friday as traders awaited key U.S. inflation data, likely to influence interest rate expectations. The metal markets saw some relief from a weaker dollar, but persistent inflation fears kept gains in check. Meanwhile, silver and crude oil prices faced downward pressure ahead of U.S. Core PCE data and the OPEC+ meeting.

Markets In Focus Today – GOLD

Gold prices steady with PCE test in focus.

Gold prices steadied in Asian trade on Friday, with traders remaining wary of the yellow metal before key U.S. inflation data that is likely to factor into the outlook for interest rates.Metal markets saw some relief on Friday after the dollar slid from over two-week highs in overnight trade, tracking weak gross domestic product figures. But this relief was limited, as fears of sticky inflation and high interest rates persisted before key inflation data. Gold price trades with a mild positive bias on Friday. The weaker USD and decline of US yields support the yellow metal. Later on Friday, gold traders will keep an eye on the US April Core Personal Consumption Expenditures Price Index (Core PCE), the Fed’s preferred inflation measure. The Core PCE figure is projected to show an increase of 0.3% MoM and 2.8% YoY in April. In case of the hotter-than-expected inflation data, this might provide some support to the Greenback and cap the upside for gold price.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2352.8844 | Negative Crossover | Bearish
  • MA 20 : 2351.4658 | Negative Crossover | Bearish
  • MA 50 : 2308.9923 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2362.2294 | Negative Crossover | Bearish
  • MA 20 : 2357.3760 | Negative Crossover | Bearish
  • MA 50 : 2328.3380 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 49.7594 | Neutral Zone | Neutral

Stochastic   Oscillator : 53.24 | Buy Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Limit Sell : 2354.78 | Take Profit : 2335.37 | Stop Loss : 2364.07

SILVER

XAG/USD extends losses to near $31.00 due to market caution.

Silver price continues to lose ground as traders exercise caution ahead of US Core PCE.US Treasury yields appreciate due to the hawkish Fed, which weakens the demand for non-yielding Silver.The higher US Dollar impacts the grey metal demand as it becomes more expensive for foreign buyers.Silver price continues to lose ground for the third consecutive day, trading around $31.10 per troy ounce during the European session on Friday. The hawkish remarks from Federal Reserve (Fed) officials have raised concerns about potential rate hikes. Higher interest rates are negatively impacting non-yielding assets like Silver.Additionally, the stronger US Dollar (USD) makes the grey metal more expensive for foreign buyers. This increased cost leads to lower Silver demand and subsequently lower prices. US Dollar Index (DXY), which measures the value of the US Dollar against six other major currencies, trades higher around 104.80 with 2-year and 10-year yields on US Treasury bonds standing at 4.94% and 4.56%, respectively, by the press time.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 31.32 | Negative Crossover | Bearish
  • MA 20 : 31.22 | Negative Crossover | Bearish
  • MA 50 : 30.46 | Positive Crossover | Bullish

Simple :

  • MA 10 : 31.32 | Negative Crossover | Bearish
  • MA 20 : 31.22 | Negative Crossover | Bearish
  • MA 50 : 30.46 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 51.76 | Buy Zone | Bullish

Stochastic   Oscillator : 9.71 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 31.49 R2 : 32.56
  • S1 : 30.01 S2 : 28.76

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Limit Sell : 31.64 | Take Profit : 30.12 | Stop Loss : 32.63

CRUDE OIL

WTI drops to near $77.50 as US PCE, OPEC+ meeting loom.

WTI price lost ground ahead of the US PCE on Friday.OPEC+ is expected to maintain supply cuts of 2.2 million barrels per day on June 2.EIA Crude Oil Stocks Change declined by 4.156 million barrels in the previous week, against the expected 1.900 million-barrel draw.West Texas Intermediate (WTI) crude Oil continues its losing streak for the third consecutive day, trading around $77.50 per barrel during the Asian session on Friday. Traders are likely awaiting the upcoming meeting of the Organization of the Petroleum Exporting Countries and its allies, including Russia (OPEC+), scheduled for June 2. OPEC+ will begin a series of online meetings at 1100 GMT on Sunday. According to Reuters, three sources familiar with OPEC+ discussions indicated on Thursday that the group is working on a complex deal to be agreed upon at its meeting on Sunday. This deal will potentially allow OPEC+ to extend some of its deep Oil production cuts into 2025.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 78.5463 | Negative Crossover | Bearish
  • MA 20 : 79.0495 | Negative Crossover | Bearish
  • MA 50 : 79.9123 | Negative Crossover | Bearish

Simple :

  • MA 10 : 78.3730 | Negative Crossover | Bearish
  • MA 20 : 78.6718 | Negative Crossover | Bearish
  • MA 50 : 81.5100 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 43.8884 | Neutral Zone | Neutral

Stochastic   Oscillator : 50.4781 | Buy 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 : 78.41 | Take Profit : 76.56 | Stop Loss : 79.82

NATURAL GAS

U.S. Natural Gas Storage Surplus Shrinks A Bit More.

Natural gas in underground storage in the U.S. rose by 84 billion cubic feet last week to 2,795 Bcf, which was 586 Bcf above the five-year average for the time of year, the EIA reports. The injection was larger than the 77 Bcf estimate in a Wall Street Journal survey, but smaller than the 104 Bcf average for the week, and lowered the surplus from 606 Bcf the week before.Weather forecasts suggest light demand through the weekend, with a pickup next week and beyond as temperatures warm up.With a high-side surprise adding to recent bearish momentum, natural gas futures continued lower through midday trading. Given the current oversupply and forecasts for lower demand, the outlook for U.S. natural gas futures remains bearish in the short term.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.4396 | Negative Crossover | Bearish
  • MA 20 : 2.3464 | Negative Crossover | Bearish
  • MA 50 : 2.1416 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.5330 | Negative Crossover | Bearish
  • MA 20 : 2.3702 | Negative Crossover | Bearish
  • MA 50 : 1.9913 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 53.1715 | Buy Zone | Bullish

Stochastic   Oscillator : 0 | Sell Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 2.70 | Take Profit : 2.42 | Stop Loss : 2.91

Elsewhere In The Commodity Market

Gold down (0.08%) at 2341.92, Silver up (0.12%) at 31.19, Palladium up (0.2%) at 949.86, Platinum up (0.22%) at 1028.79, Brent Crude Oil down (0.28%) at 81.68, WTI Crude Oil down (0.21%) at 77.63 as of writing time.

Key Economic Events & Data Release Today:

(JPY) Retail Sales (YoY) (Apr) Forecast 1.8%, Previous 1.2% at 05:20. (CNY) Manufacturing PMI (May) Forecast 50.5, Previous 50.4 at 07:00. (NZD) Annual Budget Release at 07:30. (EUR) CPI (YoY) (May) Forecast 2.5%, Previous 2.4% at 14:30. (CAD) GDP (QoQ) (Q1) Previous 0.2% at 18:00. (USD) Core PCE Price Index (MoM) (Apr) Forecast 0.3%, Previous 0.3% at 18:00. (CAD) GDP (MoM) (Mar) Forecast 0.0%, Previous 0.2% at 18:00. (CAD) GDP (MoM) (Apr) at 18:01.