Talking Points:
- Gold and precious metals prices rose as soft US housing data dampened prospects of interest rate hikes
- Oil prices receded after news that a workers strike in Kuwait had ended
- Copper prices leaped on a risk recovery and weak dollar
Copper prices held up near a three-week high of $2.2355 as sentiment towards commodities improved and the US dollar weakened to its lowest level since August 2015. The risk rally continued and the USD fell against the euro assoft U.S. housing data reinforced the views that the Federal Reserve may hold out on interest rate rises. However gains in oil and other commodities may prove short-lived after Al Jarida news reported that the workers strike in Kuwait had ended by the Asian morning.
Oil prices receded to the high $39s for most of the Asian session after they jumped more than 3 percent on Tuesday as a strike by workers brought Kuwait’s output down to 60 percent its usual daily average. The market had only spent Monday to ponder over a failure of producers to freeze output at the Doha summit. Now that the Kuwaiti strike is nearly out of the way, negative sentiment may return to haunt oil investors.
Gold prices rose to a one-week high of $1258.13 an ounce, silver hit a 10-month high and platinum climbed to its highest in six months as the dollar weakened after U.S. housing data unexpectedly fell in March. Precious metals have had a great first quarter and silver has been playing catch up with gold. Looking ahead, prices remain dependent on global data and the Fed’s projection of the next rate rise.
Need a hand to start trading: Free Guides
To read the market’s momentum: Speculative Sentiment Index
Want to improve your trading strategy: Traits of Successful Traders
GOLD TECHNICAL ANALYSIS – Gold prices rose to a one-week high of $1258.13 although they remained well contained within the 1207.6-1284.6 range. The precious metal may continue to trade choppy in response to global market events with no particular direction.
Daily Chart - Created Using FXCM Marketscope
COPPER TECHNICAL ANALYSIS – Copper prices jumped to a three-week high of $2.2355 and mostly traded near this level during Asian trade. Momentum signals have entered overbought territory thus this upward bias may fade in the upcoming session.
Daily Chart - Created Using FXCM Marketscope
CRUDE OIL TECHNICAL ANALYSIS – Oil prices held on to a double top at 41.87 although momentum did not seem strong enough to induce a break above this resistance level. Elevated prices and high volatility may continue to dominate price action in the next few days.
Daily Chart - Created Using FXCM Marketscope
--- Written by Nathalie Huynh, Currency Strategist for DailyFX.com
To receive Nathalie’s analysis directly via email, please SIGN UP HERE
Contact and follow Nathalie on Twitter: @nathuynh
