Weekly Commodity Tips: Basic Tips About Commodity Market

13 OCT – 17 OCT 2014

W E E K L Y

R

E

P

O

R

T

Blow by Blow

On

Bullions,

Base metals,

Energy…

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MAJOR EVENTS Gold futures fell from a two-week high as signs of an improving U.S. economy boosted

the dollar, cutting the metal’s appeal as an alternative investment. A separate report

this week showed job openings in August at the highest in 13 years. Bullion still

posted a weekly advance amid growth concerns in China and Europe. Gold fell 8.4

percent last quarter as signs of a quickening U.S. recovery helped push the dollar to its

biggest gain in six years. The metal rallied the most in two months yesterday after

Federal Reserve policy makers said a global economic slowdown poses potential risks

to the U.S., sparking speculation that the central bank will keep interest rates lower

for a longer period. Gold futures for December delivery fell 0.3 percent to settle at

$1,221.70 an ounce at 1:51 p.m. on the Comex in New York. Prices reached $1,234

yesterday, the highest since Sept. 23, on the way to the first weekly gain since August.

The commodity slid to $1,183.30 on Oct. 6, the lowest since Dec. 31. Money managers

have cut their net-long position, or bets on higher prices, to the lowest this year, U.S.

government data show. Holdings in gold-backed exchange-traded products are at a

five-year low. Silver futures for December delivery lost 0.7 percent to $17.303 an

ounce on the Comex. The metal capped its first weekly gain in six weeks.

On the New York Mercantile Exchange, platinum futures for delivery in January

declined 1.3 percent to $1,261.60 an ounce, snapping four straight gains. Palladium

futures for December delivery fell 1.9 percent to $785.05 an ounce, the first decline

this week.

West Texas Intermediate crude pared the biggest weekly drop since January amid

signs of a global glut. Brent, the benchmark for more than half the world’s oil, gained

after reaching a four-year low in intraday trading. WTI closed yesterday more than 20

percent below its June peak, a common definition of a bear market. Brent is down 22

percent from the June high. Both crudes settled higher for the first time in four days

after falling more than 2 percent during trading today.

The world’s two most-traded crude futures are collapsing because demand growth is

slowing at a time when output is expanding from countries including the U.S. and

Russia, the largest suppliers outside OPEC. The Organization of Petroleum Exporting

Countries increased oil production by the most in almost three years last month as

Libyan output surged. The fundamentals are weak but don’t justify this. It’s concern

about OPEC that’s got the market rattled.”WTI for November delivery rose 5 cents to

settle at $85.82 a barrel on the New York Mercantile Exchange. Futures fell 4.4

percent this week after dropping 4.1 percent last week. The contract touched $83.59

today, the lowest intraday price since July 3, 2012.

WTI, Brent Post

Weekly Declines

as Global Supplies

Rise.

Copper Falls to

One-Week Low

as Economies

Signal Sagging

Demand.

Copper fell to a one-week low in London as economic signals in Europe and China

indicated metal demand will ebb. There are signs the euro area’s recovery is losing

momentum, European Central Bank President Mario Draghi said yesterday. In August,

exports from Germany slumped the most since 2009, data showed yesterday. China’s

main government-backed research group forecast a 7 percent expansion next year,

down from a projected 7.3 percent growth in 2014. Ongoing concerns about the global

economic outlook are going to be a drag on the industrial metals like copper. Copper

for delivery in three months declined 0.9 percent to settle at $6,645 a metric ton

($3.01 a pound) on the London Metal Exchange. Earlier, the price touched $6,613, the

lowest since Oct. 2.

The metal capped its first weekly gain since Aug. 22 after Federal Reserve policy

makers said that U.S. growth “might be slower than they expected if foreign economic

growth came in weaker than anticipated,” stoking speculation that the central bank

won’t raise interest rates anytime soon. China is the world’s largest consumer,

followed by the U.S. and Germany, which has largest economy in the euro area.

Aluminum, nickel, zinc and lead fell in London, while tin was unchanged.

Gold Declines

From Two-Week

High as Dollar

Advances.

E C O N O M I C C A L E N D E R

DATE & TIME DESCRIPTION FORECAST PREVIOUS

Oct 13 All Day Bank Holiday

Oct 14 5:00pm NFIB Small Business Index 97.2 96.1

Oct 15 6:00pm Core Retail Sales m/m 0.2% 0.3%

6:00pm PPI m/m 0.1% 0.0%

6:00pm Retail Sales m/m -0.1% 0.6%

6:00pm Core PPI m/m 0.1% 0.1%

6:00pm Empire State Manufacturing Index 20.3 27.5

7:30pm Business Inventories m/m 0.4% 0.4%

11:30pm Beige Book

Oct 16 5:30pm FOMC Member Plosser Speaks

6:00pm Unemployment Claims 286K 287K

6:45pm Capacity Utilization Rate 79.0% 78.8%

6:45pm Industrial Production m/m 0.4% -0.1%

7:30pm Philly Fed Manufacturing Index 19.9 22.5

7:30pm FOMC Member Kocherlakota Speaks

7:30pm NAHB Housing Market Index 59 59

8:00pm Natural Gas Storage

8:30pm Crude Oil Inventories

Oct 17 1:30am TIC Long-Term Purchases 23.3B -18.6B

6:00pm Building Permits 1.04M 1.00M

6:00pm Fed Chair Yellen Speaks

6:00pm Housing Starts 1.02M 0.96M

7:25pm Prelim UoM Consumer Sentiment 84.3 84.6

7:25pm Prelim UoM Inflation Expectations 3.0%

S1 S2 S3 R1 R2 R3

26470 26000 25485 27220 27650 28085

S1 S2 S3 R1 R2 R3

37940 37000 36000 39400 40500 41550

T E C H N I C A L V I E W

MCX GOLD showed correction in whole

week but not able to maintains above

27100 and closed below the resistance

level of 23.6% retracement. Now, if it

able to sustain below 26500 then next

vital support is seen near psychological

level of 26000. Contrary if it maintains

above 27100 then breakout of

downward channel pattern is expected

and may find next resistance around

27500.

S T R A T E G Y Better strategy in MCX GOLD is to buy

above 27250 for the targets of 27750

with stop loss of 26700.

PIVOT TABLE

G O L D

PIVOT TABLE

S I L V E R


MCX SILVER on daily charts showed

sideways movement and traded below

to its important support level i.e.

38500. Now, if it sustain below 38000

then next support is seen in the range

of 37000-36000. On higher side 39500

is act as important resistance level for

it above which it may test the

psychological level of 40000.

S T R A T E G Y Better strategy in MCX SILVER at this

point of time is to sell below 37900

targets of 36000, with stop loss of 39500.

C R U D E O I L

C O P P E R

S1 S2 S3 R1 R2 R3

5130 4960 4775 5355 5530 5715

S1 S2 S3 R1 R2 R3

410 404.20 399.65 417 422.30 428


MCX Copper last week showed

sideways to bearish movement,

closed below 50% retracement level

i.e. 417 but not able to sustain below

61.8% retracement. Now, if it breaks

the support level of 408 then next

support level is seen around 400. On

higher side if it maintains above 417

then next resistance is seen in the

range of 422-425.

S T R A T E G Y Better strategy in MCX CRUDEOIL is to

sell on highs for the targets of 5000, with

stop loss of 5550.

PIVOT TABLE


MCX Crude oil last week showed free

fall after giving breakout of its

important support level i.e. 5525 and

found support around 5100. Now, if it

sustain in the range of 5200-5100 in

upcoming sessions then it may test the

next psychological support level of

5000. On other hand some correction

may take it towards the resistance

level of 5500.

S T R A T E G Y Better strategy in MCX COPPER is to sell

below 411, with stop loss of 423 for the

targets of 405-400.

PIVOT TABLE


DISCLAIMER