. Daily Commodity Analysis - OPEC+ Plans Oil Cuts, Gold Hits $1,975 in Global Shifts.

Daily Commodity Analysis – OPEC+ Plans Oil Cuts, Gold Hits $1,975 in Global Shifts.

Daily Commodity Analysis – OPEC+ Plans Oil Cuts, Gold Hits $1,975 in Global Shifts.

20 Nov 2023

Introduction:

In the commodities landscape, Oil prices are on an upward trajectory as OPEC+ anticipates further production cuts. Recent advancements follow a 4% increase in both oil contracts, driven by OPEC+ discussions on additional supply cuts. Meanwhile, gold faces a corrective trend, with its direction hinging on the 21-day SMA around $1,975.  The gold market’s trajectory will likely be shaped by US Dollar and Treasury bond yield movements in the absence of significant economic releases. Additionally, copper prices surged due to Chinese officials’ commitment to supporting the real estate sector, while silver experienced a modest decline from its recent two-month peak.

Brent Crude Oil:

With more OPEC+ production cuts expected, oil prices are trending upward.

Oil futures advanced on Monday, continuing their upward trend, as there are expectations that OPEC+ may increase supply cuts. This move aims to support oil prices, which have declined for four consecutive weeks due to worries about demand and disruptions in Middle East supply linked to the Israel-Hamas conflict.

Both contracts closed with a 4% increase on Friday following information from three OPEC+ sources disclosed to Reuters. These sources revealed that the producer group, consisting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, is slated to discuss the possibility of implementing additional supply cuts during its meeting on November 26.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 80.35| Positive Crossover | Bullish
  • MA 20: 80.83| Positive Crossover | Bullish
  • MA 50: 82.84| Negative Crossover | Bearish

Simple:

  • MA 5: 79.73| Positive Crossover | Bullish
  • MA 20: 80.83| Positive Crossover | Bullish
  • MA 50: 83.23| Negative Crossover | Bearish

RSI (Relative Strength Index): 49.16| Buying Zone | Bullish

Stochastic Oscillator: 90.94| Buy Zone | Positive

Resistance And Support Levels:

  • R1: 82.19 | R2: 87.25
  • S1: 78.34| S2: 74.56

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 83.47 | Take Profit: 87.25 | Stop Loss: 81.15.

Gold:

To continue rising, gold must hold the 21-day SMA around $1,975.

The price of gold is sustaining its corrective downtrend from the ten-day peak of $1,993 reached on Friday. As the new week begins on Monday, the market is seeking a distinct directional catalyst.

Early on Monday, the sentiment toward risk remains positive, influenced by optimism surrounding China’s stimulus efforts and positive corporate earnings reports from Japan.

In the upcoming period, the price of gold is expected to be influenced by the movements of the US Dollar and US Treasury bond yields. This is especially notable as the US economic calendar does not feature any high-impact economic releases or scheduled speeches from Federal Reserve policymakers.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1978.83 | Negative Crossover | Bearish
  • MA 20: 1970.15 | Positive Crossover | Bullish
  • MA 50: 1965.71| Positive Crossover | Bullish

Simple:

  • MA 5: 1980.59 | Negative Crossover | Bearish
  • MA 20: 1962.52| Positive Crossover | Bullish
  • MA 50: 1971.58| Positive Crossover | Bullish

RSI (Relative Strength Index): 57.61 | Buy Zone | Bullish

Stochastic Oscillator: 77.26| Buy Zone | Negative

Resistance And Support Levels:

  • R1: 1981.74 | R2: 2013.32
  • S1: 1954.27| S2: 1928.87

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion:  Stop Buy: 1987.23 | Take Profit: 2013.32 | Stop Loss: 1973.50.

Elsewhere In the Commodity Market.

On Monday, copper prices surged to a level not seen in over a month, following the commitment of Chinese officials to implement additional policy support for the country’s struggling real estate sector. This sector serves as a crucial driver for copper demand. Silver experiences a slight decline, moving away from the two-month high reached on Friday.

Gold down (0.19%) at 1977.06, Silver down (0.64%) at 23.54, Palladium up (0.1%) at 1058.06, Platinum up (0.56%) at 902.64, Brent Crude Oil up (0.67%) at 81.13, WTI Crude Oil up (0.71%) at 76.59 as of writing time.

Key Economic Events & Data Release Today:

(CNY) PBoC Loan Prime Rate (Nov) Actual 3.45%, Forecast 3.34%, Previous 4.20% at 06:45.

(EUR) ECB’s Lane Speaks at 10:30.

(EUR) German PPI (MoM) (Oct) Actual –0.1%, Forecast –0.1%, Previous-0.2% at 12:30.