Commodity Morning Trading Guide | Globe Capital
21-Nov-2022
Commodity Morning Trading Guide

Bullions counter may trade in red as pressured by a rebound in the dollar index while further cues on central banks’ interest rates need to be seen. Gold can move lower as it can test 52350 while taking resistance near 52700 while silver can move lower and can test 60000 while taking resistance near 61500.

Report Overview

BULLIONS

Bullions counter may trade in red as pressured by a rebound in the dollar index while further cues on central banks’ interest rates need to be seen. Gold can move lower as it can test 52350 while taking resistance near 52700 while silver can move lower and can test 60000 while taking resistance near 61500. U.S. Federal Reserve’s last meeting on Wednesday, and there’s potential for the dollar to continue higher should they be more hawkish than expected. Atlanta Fed President Raphael Bostic said Saturday he is ready to “move away” from three-quarter-point rate hikes at the Fed’s December meeting. But the central bank is still expected to raise rates by half a percentage point, a view endorsed by other Fed officials as well recently. Chinese physical gold premiums fell sharply last week as buying slowed.

BASE METALS

In base metal counter, Copper can trade with weaker path as it can test 660 while taking resistance near 685. On the fundamentals, LME did not restrict the delivery of Russian metals. LME copper inventory rose to 90,000 mt, and the proportion of registered warrants increased while that of cancelled warrants fell. The backwardation structure of the LME cash to 3M spread was shifted to the contango structure, and the risk of a short squeeze was lifted. Zinc may slip lower as it can test 262 while taking resistance near 270.  Aluminum can move on sideways path in range of 203-210. Recently, the China pandemic situation has worsened, and the transportation efficiency declined. Stimulated by domestic favourable policies, aluminium prices jumped above 19,000 yuan/mt. However, higher prices and poor orders discouraged downstream purchases with arrival of the traditional off-season.

ENERGY: Crude oil may continue its downside momentum as it can move lower towards 6400 while taking resistance near 6700. Oil continue to slip lower as supply fears receded while concerns over China’s fuel demand and rising interest rates weighed on prices. The front-month Brent crude futures spread narrowed sharply last week while WTI flipped into a contango, reflecting dwindling supply concerns. Tight crude supplies in Europe have eased as refiners have piled up stocks ahead of the Dec. 5 European Union embargo on Russian crude, putting pressure on physical crude markets across Europe, Africa and the United States. Demand in the world’s top crude importer remains bogged down by COVID-19 restrictions while expectations of further interest rate rises elsewhere have elevated the greenback, making dollar-denominated commodities more expensive for investors. Natural gas prices may remain on negative path as it can test 485 while taking resistance near 510.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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