. Daily Commodity Analysis - Oil Soars, Silver Sparkles, Fed's Bold Move

Daily Commodity Analysis – Oil Soars, Silver Sparkles, Fed’s Bold Move

Daily Commodity Analysis – Oil Soars, Silver Sparkles, Fed’s Bold Move

02 Nov 2023

Introduction:

In the commodities market, Brent Crude Oil witnessed a 1% surge in prices following the U.S. Federal Reserve’s decision to maintain interest rates, ending a recent three-day decline. This optimism also extended to other financial assets. At the same time, the Middle East situation remains a watchful concern for oil markets. Meanwhile, Silver’s performance around the $23.00 mark lacks full bullish conviction, and it continues to consolidate its gains. In the broader commodities market, gold prices saw an increase, while copper prices experienced a modest rise post the Federal Reserve meeting.

Brent Crude Oil:

Oil rises 1% after Fed keeps rates unchanged.

Crude oil prices surged by 1% on Thursday, ending a three-day decline, as renewed optimism in financial markets followed the decision by the U.S. Federal Reserve to maintain its benchmark interest rates.

In the prior session, both reference oil prices closed at their lowest levels in several weeks.

The rise in oil prices is concurrent with gains observed in various financial assets, prompted by the Federal Reserve’s decision to maintain its key interest rate at 5.25%-5.50% during its most recent meeting on Wednesday.

Investors are closely monitoring the Middle East for any developments, as the potential for a broader conflict in the region remains a source of concern due to its potential to disrupt oil supplies.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 85.63| Positive Crossover | Bullish
  • MA 20: 86.86| Negative Crossover | Bearish
  • MA 50: 87.91| Negative Crossover | Bearish

Simple:

  • MA 5: 85.51| Positive Crossover | Bullish
  • MA 20: 87.00| Negative Crossover | Bearish
  • MA 50: 88.21| Negative Crossover | Bearish

RSI (Relative Strength Index): 41.72 | Neutral Zone | Neutral

Stochastic Oscillator: 34.48| Sell Zone | Positive

Resistance And Support Levels:

  • R1: 87.41 | R2: 90.23
  • S1: 85.39| S2: 82.46

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 84.59 | Take Profit: 82.46 | Stop Loss: 86.26.

Silver:

XAG/USD sticks to gains near $23.00 mark, lacks bullish conviction.

Silver experiences a slight upward momentum but encounters difficulty in extending its gains beyond the $23.00 mark. The inconclusive technical indicators suggest that cautiousness is warranted among bullish traders before considering additional advances.

Silver (XAG/USD) continues to build on its recent recovery, which started from the mid-$22.00 range, marking a multi-day low. It has garnered further upward momentum on Thursday. The silver market maintains its positive bias during the early European session and is currently trading near the key $23.00 level, posting a daily gain of more than 0.20%.

The persistent USD selling trend following the FOMC meeting continues to influence market sentiment and is a significant driver of capital flow towards USD-denominated commodities like XAG/USD.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 22.97 | Positive Crossover | Bullish
  • MA 20: 22.97 | Positive Crossover | Bullish
  • MA 50: 22.85 | Positive Crossover | Bullish

Simple:

  • MA 5: 22.88 | Positive Crossover | Bullish
  • MA 20: 22.97 | Positive Crossover | Bullish
  • MA 50: 22.94 | Positive Crossover | Bullish

RSI (Relative Strength Index): 53.63 | Buy Zone | Bullish

Stochastic Oscillator: 44.37| Neutral Zone | Positive

Resistance And Support Levels:

  • R1: 23.17 | R2: 24.23
  • S1: 22.42| S2: 21.57

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 23.46 | Take Profit: 24.23 | Stop Loss: 23.00.

Elsewhere In the Commodity Market.

On Thursday, gold prices saw an increase, buoyed by a declining dollar and lower Treasury yields. copper prices experienced a modest increase on Thursday, as they took advantage of a weakened dollar following the Federal Reserve meeting.

Gold up (0.29%) at 1988.09, Silver up (0.69%) at 23.08, Palladium down (0.44%) at 1104.00, Platinum up (1.11%) at 930.20, Brent Crude Oil up (1.55%) at 85.92, WTI Crude Oil up (1.69%) at 81.78 as of writing time.

Key Economic Events & Data Release Today:

(USD) FOMC Press Conference at 00:00.

(EUR) German Manufacturing PMI (Oct) Forecast 40.7, Previous 39.6 at 14:10

(GBP) BOE MPC Meeting Minutes at 17:30.

(GBP) BOE Interest Rate Decision (Nov) Forecast 5.25%, Previous 5.25% at 17:30.

(USD) Initial Jobless Claims Forecast 210K, Previous 210K at 18:00.

(GBP) BOE Gov Bailey Speaks at 19:45.