. Daily Commodity Analysis - Natural Gas React to Economic Data

Daily Commodity Analysis – Natural Gas React to Economic Data

Daily Commodity Analysis – Natural Gas React to Economic Data

30 May 2024

Introduction

Gold prices extend losses in Thursday’s Asian session, pressured by a stronger USD and higher US yields. Investors await US Q1 GDP data and monitor Middle East geopolitical risks. Meanwhile, silver struggles around $31.40, and WTI crude dips to $79.00 per barrel ahead of key economic releases. Natural gas prices fall amid increased market volatility.

Markets In Focus Today – GOLD

Gold price extends losses ahead of US GDP data.

Gold price loses traction in Thursday’s Asian session. The downtick of the yellow metal is backed by the stronger USD and higher US yields.Gold traders await the US Q1 GDP data for fresh impetus and monitor the Middle East geopolitical risks. Gold price (XAU/USD) trades in negative territory on Thursday, supported by the firmer US Dollar (USD) and higher US yields. The diminishing expectation of the Federal Reserve’s (Fed) rate cut in September exerts some selling pressure on the precious metal as it will increase gold’s opportunity costs. Investors will monitor the second estimate of the US Gross Domestic Product (GDP) for Q1 2024 on Thursday. In the event that the US economy shows a stronger-than-expected reading, this might further lift the USD and weigh on the USD-denominated gold price. Nonetheless, the ongoing geopolitical tensions in the Middle East might boost traditional safe-haven assets like gold. Also, the rising demand from the central bank might cap the downside for yellow metal in the near term.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2353.6599 | Negative Crossover | Bearish
  • MA 20 : 2351.6331 | Negative Crossover | Bearish
  • MA 50 : 2307.3114 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2368.6421 | Negative Crossover | Bearish
  • MA 20 : 2354.9539 | Negative Crossover | Bearish
  • MA 50 : 2324.6246 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 46.1121 | Neutral Zone | Neutral

Stochastic   Oscillator : 19.2948 | Sell Zone | Negative

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 : 2339.19 | Take Profit : 2311.05 | Stop Loss : 2360.84

SILVER

XAG/USD trades lower around $31.50, US economic data awaited.

Silver price lost ground due to investors’ caution ahead of US GDP Annualized due on Thursday.Hawkish remarks from Fed officials have supported US Treasury yields, negatively impacting non-yielding assets like Silver.The escalated geopolitical tensions in the Middle East could limit the losses of the safe-haven Silver.Silver prices extended its losses for the second successive day, trading around $31.40 per troy ounce during the Asian hours on Thursday. The price of the grey metal is struggling as investors adopt caution ahead of the release of US Gross Domestic Product Annualized (Q1) data on Thursday and the Core Personal Consumption Expenditures (PCE) Price Index figures on Friday. US economic growth on an annualized basis for the first quarter is expected to grow by 1.3%, lower than the previous quarter’s 1.6% rise. Federal Reserve’s preferred measure of inflation, US Core PCE is expected to show an increase of 0.3% month-over-month and 2.8% year-over-year in April.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 31.54 | Negative Crossover | Bearish
  • MA 20 : 31.28 | Positive Crossover | Bullish
  • MA 50 : 30.38 | Positive Crossover | Bullish

Simple :

  • MA 10 : 31.66 | Negative Crossover | Bearish
  • MA 20 : 31.12 | Positive Crossover | Bullish
  • MA 50 : 30.33 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 54.71 | Buy Zone | Bullish

Stochastic   Oscillator : 51.86 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 32.26 R2 : 33.70
  • S1 : 30.93 S2 : 29.60

Overall Sentiment : Neutral Market Direction : Buy

Trade Suggestion : Limit Buy : 30.27 | Take Profit : 32.12 | Stop Loss : 29.20

CRUDE OIL

WTI drops to near $79.00 ahead of key US economic releases.

West Texas Intermediate (WTI) crude Oil dipped slightly to around $79.00 per barrel in the Asian trading session on Thursday. Traders keep an eye out for the US crude Oil Stocks Change report from the Energy Information Administration later today. Market projections suggested that US energy firms would draw down 1.9 million barrels of crude from storage in the week ending May 24, following the addition of 1.825 million barrels the week before. In the previous week, the API Weekly Crude Oil Stock indicated a decrease of 6.49 million barrels, contrasting with the 2.48 million barrels added in the week prior. Traders are also awaiting the upcoming meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia (OPEC+), scheduled for June 2. During this meeting, member producers will discuss prolonging voluntary output cuts of 2.2 million barrels per day into the latter half of 2024. It’s anticipated that the group will opt to maintain supply cuts.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 78.8790 | Positive Crossover | Bullish
  • MA 20 : 79.2714 | Negative Crossover | Bearish
  • MA 50 : 80.0364 | Negative Crossover | Bearish

Simple :

  • MA 10 : 78.6869 | Positive Crossover | Bullish
  • MA 20 : 78.7294 | Positive Crossover | Bullish
  • MA 50 : 81.5896 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 45.5496 | Neutral Zone | Neutral

Stochastic   Oscillator : 58.99 | 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 : 79.88 | Take Profit : 78.03 | Stop Loss : 81.35

NATURAL GAS

Natural Gas Prices Fall as Volatility Rises to 10 – 20 Cents per Day.

U.S. Natural Gas Prices Decline Amid Increased VolatilityU.S. natural gas prices were trending lower on Wednesday, reversing previous gains following the first rally since last week’s price reversal. Despite increased demand forecasts, market conditions remain volatile. Daily volatility in the natural gas market has escalated, with daily trading ranges expanding significantly. According to NatGasWeather, recent sessions have seen daily price movements of 10-20 cents, compared to a more stable 10-cent range in previous months. This increased volatility is contributing to uncertainty in market direction. Natural gas production in the Lower 48 states has averaged 97.7 billion cubic feet per day (bcfd) in May, down from 98.2 bcfd in April. Given the current market conditions, the short-term outlook for U.S. natural gas prices remains bearish.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.4714 | Negative Crossover | Bearish
  • MA 20 : 2.3522 | Negative Crossover | Bearish
  • MA 50 : 2.1356 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.5575 | Negative Crossover | Bearish
  • MA 20 : 2.3544 | Negative Crossover | Bearish
  • MA 50 : 1.9793 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 56.5026 | Buy Zone | Bullish

Stochastic   Oscillator : 0 | Neutral Zone | Negative

Resistance   And Support Levels :

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

Overall Sentiment : Neutral Market Direction : Buy

Trade Suggestion : Limit Buy : 2.47 | Take Profit : 2.74 | Stop Loss : 2.29

Elsewhere In The Commodity Market

Gold down (0.11%) at 2335.12, Silver down (1.55%) at 31.47, Palladium down (1.33%) at 945.29, Platinum up (0.26%) at 1038.17, Brent Crude Oil down (0.18%) at 83.17, WTI Crude Oil down (0.27%) at 79.03 as of writing time.

Key Economic Events & Data Release Today:

(NZD) Annual Budget Release at 07:30. (CHF) GDP (QoQ) (Q1) Forecast 0.3%, Previous 0.3% at 12:30. (EUR) Unemployment Rate (Apr) Forecast 6.5%, Previous 6.5% at 14:30. (USD) GDP (QoQ) (Q1) Forecast 1.6%, Previous 3.4% at 18:00. (USD) Initial Jobless Claims Forecast 218K, Previous 215K at 18:00. (USD) Pending Home Sales (MoM) (Apr) Forecast –1.1%, Previous 3.4% at 19:30.