News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Commodities Tread Water in Asia - Where Do We Go From Here?

Commodities Tread Water in Asia - Where Do We Go From Here?

Ilya Spivak, Head Strategist, APAC

Talking Points

  • Commodities Consolidate in Asia as Markets Wait for Directional Impetus
  • S&P 500 Futures Point to Risk-On Mood But Conviction Appears Lacking

Commodities are in consolidation mode overnight, with traders looking for the next catalyst to spark directional momentum against the backdrop of quiet data docket. S&P 500 index futures are pointing cautiously higher, hinting yesterday’s advance may have scope to carry forward on the back of firming risk appetite.

Such a scenario would see growth-sensitive crude oil and copper prices following shares higher while gold and silver enjoy de-facto support courtesy of eroding haven demand for the US Dollar. Conviction appears sorely lacking however, clouding the near-term landscape in uncertainty.

Minor event risk begins with Eurozone PPI figures, where a spike in wholesale inflation to 2.6 percent in August from 1.8 percent in the prior month may carry risk-off implications by way of denting (admittedly slim) ECB stimulus hopes. Spanish unemployment data is also on tap, with forecasts calling for a 57K increase in September. API’s weekly set of crude oil inventory metrics and September’s US Vehicle Sales numbers round out the day.

WTI Crude Oil (NY Close): $92.48 // +0.29 // +0.31%

Prices bounced from support at 89.44, the 38.2% Fibonacci expansion, to challenge the 23.6% level at 93.60. A break above this barrier exposes the underside of a rising channel set from early July, now at 96.22. Alternatively, a reversal through support targets the 50% Fib at 86.04.

Commodities_Tread_Water_in_Asia_-_Where_Do_We_Go_From_Here_body_Picture_3.png, Commodities Tread Water in Asia - Where Do We Go From Here?

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1775.30 // +3.20 // +0.18%

Prices remain range-bound after taking out resistance at a falling trend line connecting major swing highs since early November 2011. Near-term resistance is at 1790.55-1802.80 area, with a break above that exposing 1850.00 and the 1900.00. The trend line – now at 1747.80 – has been recast as support and is reinforced by the 23.6% Fibonacci retracement at 1737.59. A push below the latter boundary targets 1704.25 and 1677.30, the 38.2% and 50% Fibonacci retracements respectively.

Commodities_Tread_Water_in_Asia_-_Where_Do_We_Go_From_Here_body_Picture_4.png, Commodities Tread Water in Asia - Where Do We Go From Here?

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $34.66 // +0.12 // +0.35%

Prices are testing above resistance at 34.80, the 76.4%Fibonacci retracement. A break higher exposes 36.89. Initial support lines up in the 32.93-33.14 area, marked by a horizontal pivot level and the 61.8% Fib, with a reversal below that targeting the 50% level at 31.79.

Commodities_Tread_Water_in_Asia_-_Where_Do_We_Go_From_Here_body_Picture_5.png, Commodities Tread Water in Asia - Where Do We Go From Here?

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.786 // +0.028 // +0.75%

Prices continue to consolidate below resistance at a falling trend line set from early February (3.826). A break higher exposes swing highs at 3.955 and 3.988. Near-term support lines up at 3.707, the 23.6% Fibonacci retracement level. A push below that targets the 38.2% level at 3.627.

Commodities_Tread_Water_in_Asia_-_Where_Do_We_Go_From_Here_body_Picture_6.png, Commodities Tread Water in Asia - Where Do We Go From Here?

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

To be added to Ilya's e-mail distribution list, send a note with subject line "Distribution List" to ispivak@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES