. Daily Commodity Analysis - Markets react to geopolitical tensions, opportunities.

Daily Commodity Analysis – Markets react to geopolitical tensions, opportunities.

Daily Commodity Analysis – Markets react to geopolitical tensions, opportunities.

03 Apr 2024

Introduction

Gold prices retreat from their recent all-time high on Wednesday, hovering below the peak while awaiting fresh impetus from US data. Reduced expectations for a June Fed rate cut strengthen the USD, limiting gains for gold. Meanwhile, geopolitical tensions in the Middle East offer some support to the precious metal. Silver prices surge to a two-week high amid global tensions, while WTI crude oil hits a five-month peak of $84.85 due to Middle East uncertainties. Additionally, US natural gas futures gain traction on near-term weather forecasts, reflecting the complex dynamics impacting energy markets.

Markets In Focus Today – GOLD

Gold price trades with negative bias below all-time high eyes US data for fresh impetus.

Gold price retreats from a new all-time peak on Wednesday, though the downside seems limited. Reduced bets for a June Fed rate cut act as a tailwind for the USD and cap gains for the metal. Rising geopolitical tensions in the Middle East should limit the downside for the XAU/USD. Gold price (XAU/USD) pulled back after hitting a fresh record high earlier this Wednesday and remains on the defensive through the first half of the European session. The incoming stronger US macro data pointed to a resilient economy and raised doubts over whether the Federal Reserve (Fed) will cut interest rates three times this year. The shift in outlook keeps the US Treasury bond yields elevated and prompts some profit-taking around the non-yielding yellow metal, especially after the recent strong runup witnessed over the past week or so.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2226.5698 | Positive Crossover | Bullish
  • MA 20 : 2190.2934 | Positive Crossover | Bullish
  • MA 50 : 2126.6667 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2215.7857 | Positive Crossover | Bullish
  • MA 20 : 2191.5720 | Positive Crossover | Bullish
  • MA 50 : 2099.7409 | Positive Crossover | Bullish

RSI (Relative Strength Index): 79.3498 | Buy Zone | Bullish

Stochastic   Oscillator : 91.6776 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 2244.9097 R2 : 2291.4069
  • S1 : 2094.3849 S2 : 2047.8877

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 2263.68 | Take Profit: 2287.00 | Stop Loss: 2250.97

SILVER

XAG/USD Hits Two-Week High Amid Global Tensions.

In a notable display of strength, silver prices have soared to a two-week high, testing the significant level of $25.91 set on December 3. This rally, extending over four consecutive days, reflects a trend also evident in the gold market, where bullion marked its largest monthly increase in March since July 2020. Driven by momentum-following funds, this surge highlights the growing investor interest in precious metals as safe-haven assets. Silver’s recent ascent is remarkable, given the array of economic challenges it faces. The U.S. dollar, bolstered by strong economic data, has reached a five-month high, impacting the likelihood of a June interest rate cut. This is accompanied by a rise in long-term U.S. Treasury yields, which would traditionally deter silver investments.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 25.65 | Positive Crossover | Bullish
  • MA 20 : 25.33 | Positive Crossover | Bullish
  • MA 50 : 24.90 | Positive Crossover | Bullish

Simple :

  • MA 10 : 25.50 | Positive Crossover | Bullish
  • MA 20 : 25.11 | Positive Crossover | Bullish
  • MA 50: 25.0- | Positive Crossover | Bullish

RSI (Relative Strength Index): 78.29 | Buy Zone | Bullish

Stochastic   Oscillator : 95.08 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 26.61 R2 : 27.43
  • S1 : 25.78 S2 : 25.07

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 25.70 | Take Profit: 26.51 | Stop Loss: 25.16

CRUDE OIL

WTI attracts some buyers to a nearly five-month high of $85.00, and Middle East tensions rise.

WTI edges higher to $84.85, a five-month high on Wednesday. Geopolitical uncertainties in the Middle East and supply fears boosted oil prices. The weaker US Dollar from the Fed’s dovish comments lift WTI prices. Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $84.85, the highest since October 2023 on Wednesday. The uptick in WTI prices is bolstered by the weaker US Dollar (USD), and the supply fears amid the geopolitical uncertainties. The escalating geopolitical tensions in the Middle East and Russia-Ukrain, such as the Israeli airstrike on an Iranian embassy in Syria on Monday, the ongoing Ukrainian attacks on Russian refineries, and the Houthi attacks on shipping in the Red Sea, raise fear of further tightening supplies, which boost WTI prices.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 83.0912 | Positive Crossover | Bullish
  • MA 20 : 81.7015 | Positive Crossover | Bullish
  • MA 50 : 79.3641 | Positive Crossover | Bullish

Simple :

  • MA 10 : 82.5875 | Positive Crossover | Bullish
  • MA 20 : 81.2971 | Positive Crossover | Bullish
  • MA 50 : 78.6736 | Positive Crossover | Bullish

RSI (Relative Strength Index): 69.5884 | Buy Zone | Bullish

Stochastic   Oscillator : 96.0975 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 83.9547 R2 : 85.6260
  • S1 : 78.5440 S2 : 76.8727

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 84.15 | Take Profit: 86.97 | Stop Loss: 82.52

NATURAL GAS

U.S. Natural Gas Futures Gain on Near-Term Weather Outlook.

U.S. natural gas futures settle higher, helped by forecasts for some short-term cold weather that could lift demand and make a small dent in large storage surpluses that have been keeping a lid on prices. With bulls aiming to send prices higher for a third straight session, natural gas futures were up modestly through midday trading Tuesday as weaker production volumes and stronger physical prices hinted at tightening market conditions. Recent fluctuations in U.S. natural gas futures are a result of changing weather forecasts impacting demand, and evolving supply conditions. This creates a complex environment for traders. The market saw a temporary boost in prices due to colder weather predictions, signaling an increase in heating demand. According to NatGasWeather, a cold front across the central and eastern U.S. is expected to ramp up demand later this week.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.7021 | Positive Crossover | Bullish
  • MA 20 : 1.7225 | Positive Crossover | Bullish
  • MA 50 : 1.8944 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.6808 | Positive Crossover | Bullish
  • MA 20 : 1.7072 | Positive Crossover | Bullish
  • MA 50 : 1.8617 | Negative Crossover | Bearish

RSI (Relative Strength Index): 50.5742 | Neutral Zone | Neutral

Stochastic   Oscillator : 83.4915 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 1.8789 R2 : 1.9741
  • S1 : 1.5711 S2 : 1.4759

Overall Sentiment: Neutral Market Direction: Sell

Trade Suggestion: Limit Sell: 1.85 | Take Profit: 1.56 | Stop Loss: 2.05

Elsewhere In The Commodity Market

Gold is down (0.22%) at 2273.65, Silver is up (0.66%) at 26.30, Palladium is up (0.51%) at 1010.64, Platinum is up (0.05%) at 919.50, Brent Crude Oil is up (0.28%) at 89.17, WTI Crude Oil up (0.29%) at 85.38 as of writing time.

Key Economic Events & Data Release Today:

(EUR) CPI (YoY) (Mar) Forecast 2.5%, Previous 2.6% at 14:30. (USD) ADP Nonfarm Employment (Mar) Forecast –148K, Previous –140K at 17:45. (USD) ISM Non-Manufacturing PMI (Mar) Forecast 52.8, Previous 52.5 at 19:30. (USD) Fed Chair Powell Speaks at 21:40.