. Daily Commodity Analysis-Oil Resilience, Gold Thrives Amid Dollar's Treasury Battle

Daily Commodity Analysis- Oil Resilience, Gold Thrives Amid Dollar’s Treasury Battle

Daily Commodity Analysis- Oil Resilience, Gold Thrives Amid Dollar’s Treasury Battle

06 Oct 2023

Introduction:

Oil prices remained steady on Friday, with traders evaluating the impact of supply cuts initiated by Saudi Arabia and Russia. These cuts had earlier propelled both benchmarks to 10-month highs during the week. Lingering concerns about China’s economic recovery and its potential impact on global oil demand persisted. Furthermore, a decline in Chinese exports and imports for August, along with escalating U.S.-China tensions and disappointing Japanese data, contributed to a slight increase in gold prices. However, gold was still on track for a weekly loss, driven by concerns of potential interest rate hikes following favorable U.S. economic reports.

Market In Focus Today – WTI Crude Oil:

Oil Markets Hold Steady as Saudi and Russia’s Supply Cuts Show Resilience

WTI crude oil futures held steady below $83 per barrel on Friday, but they were set for a weekly loss of approximately 9%. This decline was primarily driven by worries about weakening global demand, despite ongoing concerns about tight supply.

Additionally, Russia lifted its recent ban on diesel fuel exports via ports, but gasoline exports remained restricted. Earlier in the week, EIA data revealed a surge in U.S. gasoline stocks and a low in gasoline demand not seen since 1998, indicating reduced consumption.

Analysts have also noted signs of decreased demand, possibly linked to reduced seasonal travel. Meanwhile, OPEC+ decided to maintain their existing oil output policy, extending voluntary supply cuts through the end of the year, aligning with Saudi Arabia and Russia’s stance.

Technical Overview With Chart:

Moving Averages:

Exponential:

  • MA 5: 85.05 | Negative Crossover | Bearish
  • MA 20: 87.34 | Negative Crossover | Bearish
  • MA 50: 84.79 | Negative Crossover | Bearish

Simple:

  • MA 5: 85.40 | Negative Crossover | Bearish
  • MA 20: 89.07 | Negative Crossover | Bearish
  • MA 50: 85.15 | Negative Crossover | Bearish

RSI (Relative Strength Index): 35.799 | Sell Zone | Bearish

Stochastic Oscillator: 35.34 | Sell Zone | Bearish

Resistance And Support Levels :

  • R1: 84.19 | R2: 84.84
  • S1: 82.07 | S2: 81.42

Overall Sentiment: Bearish | Market Direction: Strong Sell

Trade Suggestion: Sell: 82.47 | Take Profit: 81.34 | Stop Loss: 84.11

Gold

Gold Shines Brighter as Dollar Loses Its Luster

Gold prices increased as the U.S. dollar declined from its six-month high. Spot gold was 0.1% lower at $1,820.89 per ounce, on track for a second consecutive week of decline, down 1.5% for the week, primarily due to elevated Treasury yields and a strong dollar, which diminished its appeal.

Technical Overview With Chart:

Moving Averages:

Exponential:

  • MA 5: 1841.19 | Negative Crossover | Bearish
  • MA 20: 1890.36 | Negative Crossover | Bearish
  • MA 50: 1921.64 | Negative Crossover | Bearish

Simple:

  • MA 5: 1836.44 | Negative Crossover | Bearish
  • MA 20: 1906.37 | Negative Crossover | Bearish
  • MA 50: 1933.10 | Negative Crossover | Bearish

RSI (Relative Strength Index): 19.57 | Oversold Zone | Bearish

Stochastic Oscillator: 13.02 | Oversold Zone | Bearish

Resistance And Support Levels :

  • R1: 1840.44 | R2: 1844.52
  • S1: 1827.22 | S2: 1823.14

Overall Sentiment: Bullish | Market Direction: Strong Sell

Trade Suggestion: Sell: 1827.85 | Take Profit: 1824.16 | Stop Loss: 1837.65

Elsewhere In The Commodity Market

In other commodities, spot silver gained 0.9% to reach $21.09 per ounce, platinum rose 0.4% to $857.70, and palladium strengthened by 1.1% to $1,153.83, rebounding from a 5-year low earlier in the session. However, all these commodities were on track for weekly losses.