. Weekly Commodity Analysis - Gold and Silver Surge on Fed Speculation.

Weekly Commodity Analysis – Gold and Silver Surge on Fed Speculation.

Weekly Commodity Analysis – Gold and Silver Surge on Fed Speculation.

06 Jul 2024

Introduction

Gold and Silver prices surged on expectations of a Federal Reserve rate cut in September, triggered by mixed US labor market data. The US Dollar weakened on the news, buoying Gold and Silver. Oil prices, however, settled lower despite strong summer demand expectations, as the possibility of a Mideast ceasefire overshadowed supply disruption concerns.

Markets In Focus Today – GOLD

Gold rises sharply to six-week high on dismal US labor market data.

Gold price leaped over 1% to $2,385, spurred by mixed US NFP data and heightened Fed rate cut speculation.June NFP surpasses forecasts, yet revisions for April and May indicate an accelerating labor market cool-down.US Dollar Index (DXY) declines 0.16% to 104.95; 10-year Treasury yield drops more than six basis points to 4.284%.The Gold price rallied during the mid-North American session following the release of June’s US Nonfarm Payrolls (NFP) report, which exceeded forecasts, but two previous months’ downward revisions hinted that the labor market is cooling faster than the figures show. Therefore, traders bet that the Federal Reserve (Fed) will cut rates in September, increasing a headwind for the Greenback and a tailwind for the yellow metal. The XAU/USD trades at $2,391 and registers gains of over 1.40% in the day and more than 2.70% in the week after bouncing off daily lows of $2,349, sponsored in part by a weaker US Dollar, which remains undermined by lower US Treasury bond yields.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2345.8498 | Positive Crossover | Bullish
  • MA 20 : 2338.9990 | Positive Crossover | Bullish
  • MA 50 : 2324.5957 | Positive Crossover | Bullish

Simple :

  • MA 10 : 2336.4968 | Positive Crossover | Bullish
  • MA 20 : 2330.2297 | Positive Crossover | Bullish
  • MA 50 : 2339.6604 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 61.2758 | Buy Zone | Bullish

Stochastic   Oscillator : 87.0958 | Buy Zone | Positive

Resistance And Support Levels :

  • R1 : 2372.1823 R2 : 2395.9711
  • S1 : 2295.1711 S2 : 2271.3823

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 2367.74 | Take Profit : 2398.95 | Stop Loss : 2346.93

SILVER

XAG/USD skyrockets above $31.00, eyes further gains.

Silver reaches $30.66, an eight-day peak, after surpassing the $30.00 resistance.Silver soared above the June 20 high of $30.78 on Friday and extended its gains past the $31.00 figure following a weak US jobs report that lifted expectations about a possible Fed interest rate cut. Therefore, the XAG/USD climbed and traded at $31.20, a gain of 2.65%. Silver remains bullishly biased and has cleared the ‘double bottom’ neckline at the time of writing, validating the chart pattern. Buyers are gathering momentum, as depicted by the Relative Strength Index (RSI) and the daily moving averages (DMAs) located below the price action and aiming up.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 29.95 | Positive Crossover | Bullish
  • MA 20 : 29.78 | Positive Crossover | Bullish
  • MA 50 : 29.39 | Positive Crossover | Bullish

Simple :

  • MA 10 : 29.60 | Positive Crossover | Bullish
  • MA 20 : 29.60 | Negative Crossover | Bullish
  • MA 50 : 29.90 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 62.39 | Buy Zone | Bullish

Stochastic   Oscillator : 98.36 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 31.54 R2 : 32.49
  • S1 : 30.75 S2 : 29.35

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 30.88 | Take Profit : 32.32 | Stop Loss : 30.21

CRUDE OIL

Oil settles 1% lower as Mideast ceasefire talks ease supply disruption concerns.

Oil prices settled lower on Friday as the rising possibility of a ceasefire deal in Gaza outweighed strong summer fuel demand and potential supply disruptions from Gulf of Mexico hurricanes. U.S. West Texas Intermediate (WTI) crude futures settled at $83.16 a barrel, down 72 cents, or 0.9%. For the week, Brent rose 0.4%, while WTI futures posted a 2.1% rise.West Texas Intermediate (WTI) Oil price trades around $83.50 per barrel at the time of writing. Crude Oil prices remain tepid as recent data showed that the Organization of Petroleum Exporting Countries (OPEC) increased production in June for the second consecutive month. This indicates a potential easing of tight Oil markets in the coming months, exerting downward pressure on crude Oil prices. US Oil demand rose this week on strong summer demand expectations in the United States, the world’s largest oil consumer. According to the American Automobile Association (AAA), travel during this period is projected to be 5.2% higher than in 2023, with car travel alone rising by 4.8% compared to the previous year, Reuters reports.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 82.5053 | Positive Crossover | Bullish
  • MA 20 : 81.3237 | Positive Crossover | Bullish
  • MA 50 : 80.2903 | Positive Crossover | Bullish

Simple :

  • MA 10 : 82.4092 | Positive Crossover | Bullish
  • MA 20 : 81.0268 | Positive Crossover | Bullish
  • MA 50 : 79.3136 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 61.9040 | Buy Zone | Bullish

Stochastic   Oscillator : 86.0199 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 82.7869 R2 : 85.2028
  • S1 : 74.9658 S2 : 72.5499

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 81.86 | Take Profit : 85.49 | Stop Loss : 79.90

NATURAL GAS

Natural Gas sees small turnaround with NFP turning mixed.

Natural Gas jumps higher in the US session on Friday.Gas traders are sending prices lower, with Netanyahu open for a diplomatic solution. The US Dollar index eases as well, with pressure building ahead of the Nonfarm Payrolls release. Natural Gas price (XNG/USD) is trading in the green, even up over 1% on the day, after US Nonfarm Payrolls number shows some positive elements that the US Federal Reserve might be cutting in September. More positive headlines as well from Israel where Reuters reported that Israeli Prime Minister Benjamin Netanyahu assembled a diplomatic task force that will enter into negotiations with Hamas for a ceasefire and hostage deal. Although Netanyahu quickly saw that a ceasefire deal did not mean the war had stopped, markets focused on the fact that talks were underway.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 2.4485 | Negative Crossover | Bearish
  • MA 20 : 2.5261 | Negative Crossover | Bearish
  • MA 50 : 2.4345 | Negative Crossover | Bearish

Simple :

  • MA 10 : 2.4928 | Negative Crossover | Bearish
  • MA 20 : 2.6513 | Negative Crossover | Bearish
  • MA 50 : 2.4524 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 35.8123 | Sell Zone | Bearish

Stochastic   Oscillator : 3.7965 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 2.8694 R2 : 3.0200
  • S1 : 2.3820 S2 : 2.2314

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 2.45 | Take Profit : 2.24 | Stop Loss : 2.61

Elsewhere In The Commodity Market

Gold up (1.47%) at 2391.24, Silver up (2.7%) at 31.20, Palladium up (1.03%) at 1027.50, Platinum up (2.96%) at 1026.50, Brent Crude Oil down (0.79%) at 86.83, WTI Crude Oil down (0.89%) at 83.29 as of writing time

Key Economic Events & Data Release Today:

(USD) Fed Chair Powell Testifies (Tuesday) (NZD) RBNZ Interest Rate Decision (Tuesday) (NZD) RBNZ Rate Statement (Tuesday) (USD) Fed Chair Powell Testifies (Wednesday) (EUR) German CPI (MoM) (Jun) (Thursday) (GBP) Manufacturing Production (MoM) (May) (Thursday) (GBP) GDP (YoY) (May) (Thursday) (GBP) GD