. Weekly Commodity Analysis - Oil and Gold Surge 7% to $1,900 Amid Middle East Conflict

Weekly Commodity Analysis – Oil and Gold Surge 7% to $1,900 Amid Middle East Conflict

Weekly Commodity Analysis – Oil and Gold Surge 7% to $1,900 Amid Middle East Conflict

14 Oct 2023

Introduction:

In the ever-fluctuating world of commodities, Brent Crude Oil takes centre stage, climbing 7% over the week, driven by Middle East tensions, US crude data, and Russia’s influence. While the conflict in the Middle East has had minimal direct impact on oil supplies, its potential to escalate remains a concern for global markets. Meanwhile, the gold market experiences its most significant surge since March, with prices surpassing $1,900 as geopolitical events in the Middle East spur remarkable price swings. Elsewhere in commodities, the silver market gains momentum, and natural gas prices respond to a strengthening dollar and unexpected inflation figures.

Brent Crude Oil:

Oil up 7% on week after swinging on Mideast, US crude build and Russia.

Friday was one such day. As the Middle East conflict entered a new, heightened phase, crude prices rose as much as 7% for the week. This was due to Israel’s announcement that it will launch a ground attack on Gaza one week into its renewed war with the Palestinian militant group Hamas. The week ended with the same heightened tensions as it began.

The conflict in the Middle East has had little impact on global oil and gas supplies, and Israel is not a big producer. Investors and market observers, however, are assessing how it could escalate and what it might mean for supplies from nearby countries in the world’s top oil producing region.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 87.27 | Positive Crossover | Bullish
  • MA 20: 88.42 | Positive Crossover | Bullish
  • MA 50: 87.43| Positive Crossover | Bullish

Simple:

  • MA 5: 86.96 | Positive Crossover | Bullish
  • MA 20: 89.77 | Positive Crossover | Bullish
  • MA 50: 88.03 | Positive Crossover | Bullish

RSI (Relative Strength Index): 53.75| Buying Zone | Bullish

Stochastic Oscillator: 33.79| Sell Zone | Neutral

Resistance And Support Levels:

  • R1: 90.18 | R2: 94.91
  • S1: 87.16 | S2: 83.34

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 91.79 | Take Profit: 94.91 | Stop Loss: 90.08

Gold:

Biggest week since March, back at $1,900 after one huge geopolitical leap.

Gold bulls are back over $1,900 an ounce of safety after a week of extraordinary price oscillations in the yellow metal due to the latest situation in the Middle East, which caused a massive jump on Friday.

The increase in spot gold prices on Friday was the largest one-day advance since March 17. This week’s rounded-up 5% weekly gain was also the highest since March.

Gold’s most recent increase followed the Israeli government’s late-night warning to more than a million residents in Northern Gaza to leave the area as its conflict with Hamas intensified on Thursday. Regarding Israel’s preparations for a large land invasion on Gaza, there was also growing talk.

Technical Overview:

Moving Averages:

Exponential:

  • MA 5: 1900.09 | Positive Crossover | Bullish
  • MA 20: 1876.73 | Positive Crossover | Bullish
  • MA 50: 1892.42 | Positive Crossover | Bullish

Simple:

  • MA 5: 1893.13| Positive Crossover | Bullish
  • MA 20: 1865.14| Positive Crossover | Bullish
  • MA 50: 1899.64 | Positive Crossover | Bullish

RSI (Relative Strength Index): 68.90 | Buy Zone | Bullish

Stochastic Oscillator: 97.69| Buy Zone | Neutral

Resistance And Support Levels:

  • R1: 1936.27 | R2: 1994.78
  • S1: 1894.02 | S2: 1858.27

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 1952.53 | Take Profit: 1994.78 | Stop Loss: 1923.27.

Elsewhere In the Commodity Market.

A strong Friday bid helps XAG/USD rise back up into $22. 70. Prices for natural gas are slightly rising as the dollar strengthens and the monthly total inflation figure beat forecasts.

Gold up (3.41%) at 1932.40, Silver up (4.01%) at 22.70, Palladium up (0.35%) at 1148.50, Platinum up (1.32%) at 879.50, Brent Crude Oil up (5.74%) at 90.94, WTI Crude Oil up (5.80%) at 87.72 as of writing time.

Key Economic Events & Data Release for Upcoming Week:

(USD) Retail Sales (MoM) (Sep) (Tuesday).

(USD) Building Permits (Sep) Wednesday

(CNY) GDP (YoY) (Q3) (Wednesday).

(EUR) CPI (YoY) (Sep) (Wednesday)