. Daily Commodity Analysis - Mixed Moves in Gold, and Natural Gas Amid Geopolitical Tensions

Daily Commodity Analysis – Mixed Moves in Gold, and Natural Gas Amid Geopolitical Tensions

Daily Commodity Analysis – Mixed Moves in Gold, and Natural Gas Amid Geopolitical Tensions

14 May 2024

Introduction

Gold prices rebound as traders await key US inflation data, with XAU/USD showing resilience despite recent selling pressure due to the higher-for-longer US rate outlook. Escalating Middle East tensions provide short-term support. Silver and oil prices also rise, driven by geopolitical concerns and supply disruptions, while natural gas futures gain on robust export demand and strategic supply management.

Markets In Focus Today – GOLD

Gold prices edge higher with US inflation data on tap.

The gold price (XAU/USD) rebounds despite the consolidation of the US Dollar (USD) on Tuesday. The upside of yellow metal might be limited as traders might wait on the sidelines ahead of key US inflation data this week. The higher-for-longer US rate mantra has exerted some selling pressure on the XAU/USD in recent sessions. However, the safe-haven flows due to escalating Middle East tensions might boost the gold price for the time being. Investors will closely watch the key US economic data this week. The US Producer Price Index (PPI) for April is due on Tuesday, along with Fed Chair Jerome Powell’s speech. The attention will shift to the US Consumer Price Index (CPI), due on Wednesday. These reports could offer insights into the timing of the Fed’s initial rate adjustment. The hotter-than-expected inflation figures might dampen the prospect of a Fed rate cut, weighing on the precious metal. Higher interest rates may reduce overall investment demand for gold as they increase the opportunity cost associated with holding gold.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2331.7119 | Positive Crossover | Bullish
  • MA 20 : 2324.0927 | Positive Crossover | Bullish
  • MA 50 : 2269.3960 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2325.0190 | Positive Crossover | Bullish
  • MA 20 : 2331.6690 | Positive Crossover | Bullish
  • MA 50 : 2275.2501 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 55.3516 | Buy Zone | Bullish

Stochastic   Oscillator : 30.59 | Sell 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 : 2328.74 | Take Profit : 2369.54 | Stop Loss : 2303.86

SILVER

XAG/USD rises to near $28.50 due to escalated geopolitical tensions.

Silver price appreciates due to escalated tensions in the Middle East on Tuesday.Israeli troops have advanced into the northern region of Gaza in an attempt to retake territory from Hamas militants.Fed officials indicated maintaining higher rates for longer, which may undermine the non-yielding assets like Silver.Silver price extends its gains for the second consecutive session, trading around $28.30 per troy ounce during the early European session on Tuesday. The increase in the value of the safe-haven Silver can be attributed to the escalating geopolitical tensions in the Middle East. According to Reuters, Israeli forces have advanced significantly into the northern part of Gaza in an effort to reclaim territory from Hamas fighters. The Silver price was bolstered after the weekly US Initial Jobless Claims released on Thursday, which surged to a near eight-month high at 231,000. This signaled a weakening labor market and potentially provided the Federal Reserve (Fed) with room to commence its easing cycle sooner rather than later.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 28.14 | Positive Crossover | Bullish
  • MA 20 : 27.88 | Positive Crossover | Bullish
  • MA 50 : 27.53 | Positive Crossover | Bullish

Simple :

  • MA 10 : 28.23 | Positive Crossover | Bullish
  • MA 20 : 27.85 | Positive Crossover | Bullish
  • MA 50 : 27.29 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 61.28 | Buy Zone | Bullish

Stochastic   Oscillator : 46.4 | Neutral Zone | Neutral

Resistance   And Support Levels :

  • R1 : 28.73 R2 : 29.71
  • S1 : 27.90 S2 : 26.94

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 27.63 | Take Profit : 28.73 | Stop Loss : 26.94

CRUDE OIL

WTI hovers around $79.50 amid concerns of supply disruptions following Canada’s wildfires.

WTI Oil price remains firmer due to uncertainties surrounding Oil supply amid wildfires in Canada.The WTI price may face challenges as Fed officials have suggested that interest rates may stay higher for longer.West Texas Intermediate (WTI) crude Oil price trades around $79.50 per barrel during Tuesday’s Asian session. These gains in Oil prices could be attributed to uncertainties surrounding crude Oil supply amid wildfires in remote western Canada. Concerns arose regarding the country’s production capacity of 3.3 million barrels per day (bpd). Firefighters on Monday were in a race against time to contain blazes in British Columbia and Alberta, which are situated close to the heart of the country’s Oil sands industry. The Oil supply could also be affected as Hayan Abdul Ghani, Deputy Prime Minister for Energy Affairs and Minister of Oil of Iraq, reiterated Iraq’s dedication to the voluntary Oil production cuts agreed upon by the Organization of the Petroleum Exporting Countries (OPEC), Reuters cited Iraqi state news agency.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 79.4329 | Negative Crossover | Bearish
  • MA 20 : 80.4836 | Negative Crossover | Bearish
  • MA 50 : 80.8459 | Negative Crossover | Bearish

Simple :

  • MA 10 : 78.8180 | Positive Crossover | Bullish
  • MA 20 : 80.8372 | Negative Crossover | Bearish
  • MA 50 : 81.8908 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 40.9574 | Neutral Zone | Neutral

Stochastic   Oscillator : 24.7905 | Sell Zone | Positive

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 : 79.93 | Take Profit : 77.45 | Stop Loss : 81.69

NATURAL GAS

Brightening LNG Outlook Spurs Further Natural Gas Futures Gains.

With summer cooling demand just around the corner, and with continued signs of renewed strength at a major U.S. export terminal, natural gas futures were charting another leg higher .The short-term outlook for the market remains positive, buoyed by decreased production, robust LNG export demand, and strategic supply management by major producers. However, substantial gas storage volumes pose a risk of price suppression unless offset by sustained demand or further production cuts. Traders are advised to closely monitor weather patterns and LNG export levels, crucial factors shaping market trends in the coming weeks.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.0670 | Positive Crossover | Bullish
  • MA 20 : 1.9603 | Positive Crossover | Bullish
  • MA 50 : 1.8970 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.0427 | Positive Crossover | Bullish
  • MA 20 : 1.9069 | Positive Crossover | Bullish
  • MA 50 : 1.7925 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 67.5400 | Buy Zone | Bullish

Stochastic   Oscillator : 74.01 | Buy Zone | Positive

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 : 2.22 | Take Profit : 2.49 | Stop Loss : 2.05

Elsewhere In The Commodity Market

Gold up (0.07%) at 2338.05, Silver up (0.4%) at 28.31, Palladium up (0.32%) at 968.26, Platinum up (0.62%) at 1003.66, Brent Crude Oil down (0.05%) at 83.34, WTI Crude Oil down (0.4%) at 79.11 as of writing time.

Key Economic Events & Data Release Today:

(GBP) Claimant Count Change (Apr) Forecast 13.9K, Previous 10.9K at 11:30. (GBP) Average Earnings Index + Bonus (Mar) Forecast 5.3%, Previous 5.6% at 11:30. (EUR) German CPI (MoM) (Apr) Forecast 0.5%, Previous 0.4% at 11:30. (CAD) Wholesale Sales (MoM) (Mar) Forecast –0.9%, Previous 0.0% at 18:00. (USD) PPI (MoM) (Apr) Forecast 0.3%, Previous 0.2% at 18:00. (USD) Fed Chair Powell Speaks at 19:30.