Commodities: Gold Holds the Olympic Podium

17 sept

The dollar has traded near its lowest levels of the year on Monday, with a 67% probability that the Federal Reserve will make a 50 basis point cut in interest rates. The move could weaken the dollar against other currencies, especially the yen. The euro has held at $1.1123, while the British pound has reached $1.3203. The Dollar Index has settled at 100.7, near its 2024 low. With these fluctuations, precious metals have benefited. We continue to see a Carry-trade strategy in the EURO/DOLLAR that appears to be looking for the top of the channel.
• Energy:
o Oil: Brent and WTI (LCrude) have been hovering around $70 per barrel, with Brent breaking through this barrier due to Hurricane Francine in the Gulf of Mexico. Despite the buying pressure, both have lost 5% and 1.60% respectively since the beginning of the year. The IEA has lowered its global demand forecasts, while OPEC projects an increase of 2.03 million barrels per day in 2023.
o Gas (NGAS): has continued to move higher, breaking through resistance in mid-August, currently gas appears to be moving higher with the current buying pressure ahead of what is believed to be a potentially cold winter.
• Metals:
o Gold(GOLD): has traded at a new all-time high of $2,589. Gold remains a strong option and could move towards $2,700.
o Silver(SILVER): It has traded at $31,188, after breaking through resistance on August 27. Silver could accompany gold in its ascent.
o Copper(COPPERDEC24): It has traded at USD 9.308 in London, boosted by the falling dollar and expectations of support in China. It has broken the late August resistance in what looks like a strong bullish momentum and could turn into a Shoulder-Head-Shoulder figure depending on the evolution of Chinese demand for copper.
o Palladium: It has traded at USD 991.90 in the US, having reached a high of USD 995.45 yesterday. Palladium is showing a possible climb towards December 2023 prices.
• Agricultural Commodities:
o Corn (CORNDEC24): Prices have been pressured by an upward revision to the U.S. crop, although weekly results remain positive.
o Wheat(WHEATDEC24): Traded higher in Chicago, reaching 593 cents (December 2024 price). The current uptrend has fractured early August resistance and trades at what looks like the first shoulder from early July and appears to be forming a second shoulder which could send wheat back down regardless.

Ion Jauregui - ActivTrades Analyst





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