. Daily Commodity Analysis - Oil, Copper; Natural Gas Steady

Daily Commodity Analysis – Oil, Copper; Natural Gas Steady

Daily Commodity Analysis – Oil, Copper; Natural Gas Steady

29 May 2024

Introduction

The Federal Reserve’s hawkish stance weakens gold as investors anticipate higher interest rates. Focus shifts to US economic data, with the Core PCE release on Friday being key. Oil prices also dip on the stronger Dollar and hawkish Fed comments. Copper and natural gas trade sideways as traders weigh various factors.

Markets In Focus Today – GOLD

Gold price edges lower amid Fed’s hawkish remarks.

Gold price gives up gains on Wednesday on the modest USD recovery. The Fed’s hawkish comments and stronger US data support USD, weighing on the precious metal. Gold traders will focus on Fed’s Beige Book and member Williams’ speech later on Wednesday.Gold price (XAU/USD) snaps the three-day winning streak on Wednesday amid the modest rebound of the Greenback. Additionally, the hawkish remarks from several Federal Reserve (Fed) officials and stronger-than-expected US economic data diminish expectations of the Fed rate cut in September. This, in turn, boosts the US Dollar (USD) and weighs on the USD-denominated gold price. On the other hand, geopolitical tensions and uncertainty could drive the safe-haven assets for gold. The growing demand from the central bank will continue to underpin higher gold prices in the near term. Gold traders will keep an eye on the Fed’s Beige Book and the Fed’s John Williams speech on Wednesday. The release of the US Core Personal Consumption Expenditures Price Index (Core PCE) will take centre stage on Friday.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2358.9190 | Negative Crossover | Bearish
  • MA 20 : 2353.9668 | Negative Crossover | Bearish
  • MA 50 : 2306.4213 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2373.3942 | Negative Crossover | Bearish
  • MA 20 : 2353.6449 | Negative Crossover | Bearish
  • MA 50 : 2321.6684 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 49.8371 | Buy Zone | Bullish

Stochastic   Oscillator : 28.4172 | Sell Zone | Positive

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 : 2355.33 | Take Profit : 2325.44 | Stop Loss : 2368.21

COPPER

Copper flat with China in focus.

Among industrial metals, copper prices also traded rangebound as optimism over Chinese stimulus measures cooled and as traders awaited more economic cues from the world’s biggest copper importer. Focus among metal markets was squarely on more cues on U.S. interest rate cuts, especially as a slew of hawkish signals from the Fed saw traders steadily price out expectations for a cut in September. Focus remained squarely on upcoming cues on U.S. inflation and interest rates, although a somewhat hawkish outlook on rates kept traders cautious towards metal markets.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 4.82 | Negative Crossover | Bearish
  • MA 20 : 4.83 | Negative Crossover | Bearish
  • MA 50 : 4.81 | Negative Crossover | Bearish

Simple :

  • MA 10 : 4.79 | Negative Crossover | Bearish
  • MA 20 : 4.82 | Negative Crossover | Bearish
  • MA 50 : 4.86 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 45.89 | Neutral Zone | Neutral

Stochastic   Oscillator : 89.46 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 4.88 R2 : 5.14
  • S1 : 4.66 S2 : 4.46

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Limit Buy : 4.94 | Take Profit : 4.71 | Stop Loss : 5.11

CRUDE OIL

WTI turns red below $80.00, Fed’s hawkish remarks limit gains.

WTI prices edge lower near $79.90 on Wednesday, down 0.20% on the day.The stronger USD and Fed’s hawkish stance weigh on the black gold.OPEC+ is widely anticipated to maintain this level of output reduction until the end of the year.Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $79.90 on Wednesday. The black gold turns red amid renewed US Dollar (USD) demand and the hawkish remarks from the US Federal Reserve (Fed). Several Fed officials delivered hawkish remarks in recent weeks after data showed that US inflation is stickier than expected. On Tuesday, Fed Minneapolis President Neel Kashkari said that the central bank should wait for significant progress on inflation before cutting interest rates. The higher-for-longer US interest rate narrative continues to weigh on the black gold as it increases the cost of borrowing, which can dampen economic activity and oil demand.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 79.0639 | Positive Crossover | Bullish
  • MA 20 : 79.4119 | Positive Crossover | Bullish
  • MA 50 : 80.1250 | Positive Crossover | Bullish

Simple :

  • MA 10 : 78.8385 | Positive Crossover | Bullish
  • MA 20 : 78.7910 | Positive Crossover | Bullish
  • MA 50 : 81.6617 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 53.8160 | Buy Zone | Bullish

Stochastic   Oscillator : 81.6207 | Buy Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 79.82 | Take Profit : 82.38 | Stop Loss : 78.48

NATURAL GAS

Steady as Traders Weigh Production and Heat Trends.

U.S. natural gas futures are flat after recovering from early session weakness. Coming off heavy selling late last week, natural gas futures were nearly unchanged early as traders considered stronger production and mixed June forecast trends ahead of the front-month contract expiration. Last week, U.S. natural gas futures experienced a significant decline due to technical pressures and fundamental factors. Natural gas prices fell sharply, reflecting adjustments after recent spikes. Increased production in response to high prices played a significant role. Weather forecasts indicated cooler conditions in the northern U.S., reducing demand expectations. Technically, the market entered overbought territory last week, leading to the start of a correction. Given the current production levels, mixed weather forecasts, and technical adjustments, the natural gas market outlook remains volatile in the short term.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.5070 | Positive Crossover | Bullish
  • MA 20 : 2.3576 | Positive Crossover | Bullish
  • MA 50 : 2.1292 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2.5671 | Negative Crossover | Bearish
  • MA 20 : 2.3326 | Positive Crossover | Bullish
  • MA 50 : 1.9671 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 63.7578 | Buy Zone | Bullish

Stochastic   Oscillator : 11.82 | Sell 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 : 2.68 | Take Profit : 2.96 | Stop Loss : 2.53

Elsewhere In The Commodity Market

Gold down (0.63%) at 2345.60, Silver down (0.16%) at 32.01, Palladium down (1.63%) at 965.24, Platinum down (0.22%) at 1052.29, Brent Crude Oil up (0.36%) at 84.56, WTI Crude Oil up (0.3%) at 80.47 as of writing time.

Key Economic Events & Data Release Today:

(EUR) German CPI (MoM) (May) Forecast 0.2%, Previous 0.5% at 17:30.