Commodity Market Overview for this Week

The short-term trend for precious metals continues to stay positive but costs are currently in the grasp of a corrective move which could see prices drop farther until other supportive events emerge.

Precious Metals are stretching losses for the third consecutive day as the secure harbor requirement that has become the primary driver for bullion’s fade along with the market increasingly starts to search for other directional clues. Gold stocks are $7.50 or 0.56 percent to trade at $1328.28/ounce whereas Silver is down 0.49% to $17.815/ounce currently.

The tensions between North Korea and the US may have cooled for now being but it’s anticipated that the hermit state may react again following the UN put further sanctions on the nation — yet another escalation of events might induce Gold prices higher in the brief term.


Maintaining the economic tensions aside, the sector is looking forward to the financial releases this week to gauge how the FED may change its monetary policies in the present calendar year. For Gold, the important support level is observed at Rs.29,750 below which we may see an accelerated downside whereas, for Silver, Rs.41,500 ought to act as a limitation to downsides.

Crude Oil rallies aggressively as Irma damages ease and on OPEC rumors

Crude Oil is rallying higher for the second day after concerns over Hurricane Irma’s harm were eliminated as it weakened considerably after making landfall.

Crude prices must continue the recovery, albeit gradually, as formerly shut down refineries from Hurricane Harvey restart over time and due to limited effect from Irma which diminished over the last couple of days. Rates are also drawing support from rumors that OPEC and NOPEC nations are also planning with another expansion of their manufacturing reductions which were formerly set to March 2018.

The monthly OPEC report are also in focus today as the market looks forward to seeing if the oil cartel has been able to implement manufacturing quotas as was agreed by the member states in a technical meeting a month.

The short term bias remains neutral as the danger continues to stay skewed to the disadvantage because of shock events. We believe that the industry is slowly on its way to recovery as the basics continue to improve over time but in a slower than anticipated pace and so, we would advise considering buying only on deep declines to the drawback.

Base Metals enter into corrective mode

Copper is down $79.25 or 1.18% to exchange at $6,667.25 now whereas Nickel is down almost 1.50% currently.

Chinese habits reported that the imports for Copper and goods remain steady over the previous four months raising concerns regarding the improving demand from the world largest consumer of base metals.

The basic situation for Copper and the remainder of the industrial metals stay mostly the same together with projected supply shortages to deepen as we proceed towards the close of the year although the recent rally and subsequent crash has been headed by an overly optimistic market full of extended from hedge funds and speculators. The drawback is very likely to extend further over the upcoming few weeks as the costs come back to a more normal level in the short term.

We’re negative on base metals, particularly Copper that we view testing Rs.425-Rs.420 which is a very conservative estimate. It is also important to remember that these declines can finally lead to powerful short to moderate term buying opportunity.

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