. Daily Commodity Analysis - Oil Plunge, U.S. Inventories Soar, Silver Surges Toward $24.00

Daily Commodity Analysis – Oil Plunge, U.S. Inventories Soar, Silver Surges Toward $24.00

Daily Commodity Analysis – Oil Plunge, U.S. Inventories Soar, Silver Surges Toward $24.00

17 Nov 2023

Introduction:

In the commodities landscape, Oil prices are poised for a fourth consecutive week of decline, with minimal fluctuations on Friday following a significant 5% drop to a four-month low. Meanwhile, Silver (XAG/USD) maintains a positive momentum near a 10-week high, anticipating a breakthrough beyond $24.00. In other commodity markets, gold prices stabilize amid eased concerns about Federal Reserve interest rate hikes, while natural gas prices decline, and copper experiences fluctuations tied to global economic indicators.

Brent Crude Oil:

Oil prices are set for a fourth consecutive week of declines as the supply grows.

On Friday, oil prices showed minimal fluctuations but were poised for the fourth consecutive week of declines. This followed a significant 5% drop to a four-month low on Thursday, driven by concerns about global demand.

The drop in oil prices this week was primarily initiated by a sharp increase in U.S. crude inventories and sustained record-level production. Analysts suggest that this has raised concerns about weak demand in the world’s largest oil consumer amid elevated output.

Additionally, investors hesitated due to the anticipated deceleration in Chinese oil refinery throughput.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 78.78| Negative Crossover | Bearish
  • MA 20: 80.78| Negative Crossover | Bearish
  • MA 50: 83.08| Negative Crossover | Bearish

Simple:

  • MA 5: 78.84| Negative Crossover | Bearish
  • MA 20: 80.67| Negative Crossover | Bearish
  • MA 50: 83.63| Negative Crossover | Bearish

RSI (Relative Strength Index): 33.17| Selling Zone | Bearish

Stochastic Oscillator: 8.52| Sell Zone | Negative

Resistance And Support Levels:

  • R1: 79.68 | R2: 82.93
  • S1: 77.89| S2: 74.63

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 77.16 | Take Profit: 74.63 | Stop Loss: 79.11.

Silver:

XAG/USD is positioned close to a 10-week high, with bullish investors anticipating a breakthrough beyond the $24.00 level.

Silver draws buyers for the fifth consecutive day on Friday, with the overnight breakthrough above the $23.60-70 range favouring bullish sentiment. Corrective declines are expected to be met with buying interest and are likely to be constrained.

Silver (XAG/USD) continues its positive momentum for the fifth consecutive day on Friday and stays comfortably close to its highest level since September 4, reached the day before. Currently trading just below the $24.00 mark, the white metal appears ready to extend the robust rebound observed this week from a four-week low.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 23.76 | Positive Crossover | Bullish
  • MA 20: 23.16 | Positive Crossover | Bullish
  • MA 50: 23.94 | Positive Crossover | Bullish

Simple:

  • MA 5: 23.77 | Positive Crossover | Bullish
  • MA 20: 22.90 | Positive Crossover | Bullish
  • MA 50: 22.92 | Positive Crossover | Bullish

RSI (Relative Strength Index): 72.13 | Buy Zone | Bullish

Stochastic Oscillator: 92.51| Buy Zone | Neutral

Resistance And Support Levels:

  • R1: 24.10 | R2: 24.98
  • S1: 23.48| S2: 22.80

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion:  Stop Buy: 24.33 | Take Profit: 24.98 | Stop Loss: 23.94.

Elsewhere In the Commodity Market.

Gold prices remain stable and are on track for a robust week as concerns about Federal Reserve interest rate hikes alleviate. The decline in natural gas prices on Thursday coincided with a rise in both open interest and volume, indicating of the downward trend. Copper prices saw fluctuations this week as market participants assessed a combination of global economic indicators, encompassing China’s industrial data and shifts in the US dollar.

Gold up (0.37%) at 1988.40, Silver up (0.99%) at 23.95, Palladium up (0.32%) at 1041.50, Platinum up (0.62%) at 893.50, Brent Crude Oil up (0.79%) at 78.04, WTI Crude Oil up (0.85%) at 73.50 as of writing time.

Key Economic Events & Data Release Today:

(GBP) Retail Sales (MoM) (Oct) Actual –0.3%, Forecast 0.3%, Previous –0.9% at 02:00.

(EUR) ECB President Lagarde Speaks at 14:00.

(EUR) CPI (YoY) (Oct) Forecast 2.9%, Previous 4.3% at 05:00.

(USD) Building Permits (Oct) Forecast 1.450M, Previous 1.471M at 08:30.