Commodities

Gold started the week on the back foot, but today it extends this month’s advance, with gains of around 5%, rising to its highest level since June

Past performance is not an indicator of future results Further to our previous analysis, gold's EMAs are pushing for a more bullish formation. EMAs are trend-following indicators and work under trend conditions. Consolidations tend to lead to whipsaw signals. The shorter-term green EMA has moved into a bullish position, and we are now looking for the mid-term orange EMA to cross above the longer-term red EMA (aqua ellipse). If this…

US Dollar’s post-CPI rally weighed USOil down and it remains downbeat today, running a mixed week, despite the solid start to it

Past performance is not an indicator of future results Further to our previous article, we consider UKOil's weekly scale (FXCM's proxy for Bent). After a pullback, UKOil has stabilised with the three EMAs (left chart) showing angle and separation. The right chart is also weekly, but we have zoomed in on the price action. A close above last week's high (aqua horizontal) is bullish, charting a reference low. This is…

The Chicago Mercantile Exchange (CME) is the world's largest derivatives marketplace, offering the public a vast array of options and futures contracts. Several of the CME's featured products face the equity, debt, agricultural, energy and metal asset classes. Among these listings is a softwood industry staple known as random length lumber futures. What Are Lumber Futures? Lumber futures are financial derivatives that furnish participants with leveraged softwood market exposure. Hedgers…

North American traders seek the US Dollar, which puts pressure on XAU/USD, following the de-escalation in US Producer Price Index and Mr. Powell’s focus on employment

The commodity comes from two negative weeks, but starts the current one on the offensive, helped by the infrastructure bill that was passed by US Congress over the weekend

Past performance is not an indicator of future results Source: www.tradingview.com The weekly chart above shows gold (XAUUSD) from the beginning of 2019. The indicator below is the correlation coefficient between the precious metal and the US10Y. For most of this period the correlation has been negative (green rectangle). A reason for this is that bonds and gold are both considered safe-havens. During this period the yield on the US10Y…

Oil is up around 60% for 2021 and has a current price of approximately $82/barrel (Brent). OPEC+ is due to meet today and market participants don't expect a change to the current output schedules. This despite President Biden and allies encouraging producers with spare capacity to increase production. There is general alarm around inflation and the current call of "transitory" is debated. As such, a cap on oil prices will…

Past performance is not an indicator of future results Gold has had a very ordinary 2021. The precious metal has been drifting sideways for most of the year (blue rectangle). We have added a triple moving average to get a sense of gold's directional bias. This is inherently risky because moving averages are trend-following indicators. This means that they work very well during trending moves but give constant whipsaw signals…

Oil prices continued their rise yesterday, amid forecasts that climbing natural gas prices may drive a switch to oil. Oil prices have risen more than 15% since early September, largely due to the surging demand for natural gas and the search for cheaper substitutes. Natural Gas prices in Europe and Asia are at record highs, while U.S. prices have doubled this year. But what has been driving energy prices up?…