Introduction:

The trend for crude remains highly positive, supported once again by Saudi Arabia and Russia’s decision to extend production limits through the end of the year, according to Craig Erlam, analyst at online trading platform OANDA. However, oil prices have slightly stabilized as the week has progressed. “A lot more oil [is] off the market at a time when it’s obviously pretty tight, even with a highly ambiguous global economic outlook. Although demand may still be declining, traders seem to be operating under the worst-case scenario of soft landings and mild recessions. China is another uncharted country whose growth is, by its standards, moderate and steady.

Brent Crude Oil:

Oil prices increase to a 9-month high on worries about tight supply.

Due to rising U.S. diesel futures and concerns about a shortage of oil after Saudi Arabia and Russia extended production cutbacks this week, oil prices increased by about 1% on Friday, reaching a nine-month high.

For the sixth day in a row, both crude benchmarks remained technically overbought, with Brent’s settlement reaching its highest level since November 16. The settlement for WTI was the highest since September 6 and the highest since November.

Both benchmarks saw gains of roughly 2% for the week, down from gains of over 5% for Brent and 7% for WTI the previous week.

“Supply-side forces continue to drive crude oil prices. No one has any doubts that OPEC+ will maintain this market constrained into the winter, according to a note from Edward Moya, senior market analyst at data and analytics company OANDA.

Technical Overview:

Moving Averages:

Exponential:

• MA 5: 89.34 | Positive Crossover | Bullish
• MA 20: 86.60 | Positive Crossover | Bullish
• MA 50: 83.79| Positive Crossover | Bullish

Simple:

• MA 5: 89.66 | Positive Crossover | Bullish
• MA 20: 85.75 | Positive Crossover | Bullish
• MA 50: 83.25 | Positive Crossover | Bullish
  
  

RSI (Relative Strength Index): 69.34 | Buying Zone | Bullish

Stochastic Oscillator: 88.04 | Buy Zone | Positive

Resistance And Support Levels :

• R1: 90.83 | R2: 95.89
• S1: 87.20 | S2: 83.43

Overall Sentiment: Bullish | Market Direction: Buy

Trade Suggestion: Stop Buy: 92.13 | Take Profit: 95.89 | Stop Loss: 89.40

Gold:

As the dollar reaches 6-month highs, gold is down 1.2% on the week.

The likelihood of gold rising merely on a Fed rate pause was once again called into question this week as the yellow metal registered a weekly loss as its archenemy, the dollar, rose.

The most active gold futures contract for December ended trading on Friday at $1,942.70 per ounce in New York, up 20 cents from the previous day. However, losses in the three sessions that followed Monday’s U.S. Labor Day weekend meant that Comex gold ended the five-day period down by a net 1.2%, thereby wiping out the 1.3% gain from the previous week.

The prior week’s increase was fuelled by the August non-farm payrolls report for the United States, which showed an increase in unemployment from 3.5% to 3.8% despite an increase in jobs of 187,000 as opposed to the expected 170,000. When the Fed meets on September 20 to discuss U.S. monetary policy, the rising unemployment rate strengthened the idea that rates will remain steady, temporarily pushing gold higher last week.

Technical Overview:

Moving Averages:

Exponential:

• MA 5: 1920.87 | Negative Crossover | Bearish
• MA 20: 1922.59 | Negative Crossover | Bearish
• MA 50: 1926.95 | Negative Crossover | Bearish

Simple:

• MA 5: 1919.32 | Negative Crossover | Bearish
• MA 20: 1920.24 | Negative Crossover | Bearish
• MA 50: 1930.07 | positive Crossover | Bullish
  
  

RSI (Relative Strength Index): 44.46 | Neutral Zone | Neutral

Stochastic Oscillator: 7.92 | Selling Zone | Negative

Resistance And Support Levels :

• R1: 1939.52 | R2: 1973.65
• S1: 1907.28 | S2: 1869.76

Overall Sentiment: Bearish | Market Direction: Sell

Trade Suggestion: Stop Sell: 1895.49 | Take Profit: 1869.76 | Stop Loss: 1914.78

Elsewhere In the Commodity Market

Friday’s Asian session saw some buying of silver, and for the time being, it appears to have ended a seven-day losing streak to a two-and-a-half-week low, around the $22.85 region touched the day before.

China’s concerns and growth risks put pressure on copper prices. Among industrial metals, copper futures maintained their downward trend on Friday, down 1.26% to $3.71 per pound as ongoing worries about China, a significant importer, persisted.

Gold down (0.07%) at 1918.07, Silver down (0.21%) at 22.91, Palladium down (1.42%) at 1194.73, Platinum down (0.87%) at 895.14, Brent Crude Oil up (0.58%) at 90.44, WTI Crude Oil up (0.41%) at 87.23 as of writing time.

Key Economic Events & Data Release for Upcoming Week:

(USD) EIA Short-Term Energy Outlook

(USD) Crude Oil Inventories