Weekly Commodity Market Tips 4th Jan

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Transcript of Weekly Commodity Market Tips 4th Jan

  • 04 JAN 08 JAN 2016

    \

    W E E K L Y

    R

    E

    P

    O

    R

    T

    Blow by Blow

    On

    Bullions,

    Base metals,

    Energy

    WWW.TRIFIDRESEARCH.COM

  • MAJOR EVENTS Golds image as a haven asset has taken a battering with the metal capping its longest

    slump in more than 30 years as investors sold from bullion-backed funds. Bullion

    futures fell for a sixth-straight quarter, the longest slump since 1984, and lost 10

    percent this year. Prices, which were little changed on Thursday, plunged about 45

    percent since reaching a record high in 2011. The metal booked its third annual loss,

    the longest run since 1998, as the dollar surged on the back of tighter monetary

    policy in the U.S, joining a collapse in prices of commodities from iron ore to oil.

    Holdings in gold exchange-traded products have declined 10 times in the last 13

    sessions to 1,466.4 metric tons, near the lowest in more than six years. Prices may

    approach $1,000 in 2016, before recovering toward $1,200 by the end of the year as

    the dollar and bond yields retreat. The Federal Reserve raised borrowing costs for the

    first time in almost a decade this month, and traders are now focusing on the pace of

    further rate increases. While HSBC Holdings Plc predicts just two moves next year,

    Goldman Sachs Group Inc. is among banks that see four. Bullion will drop to $950 by

    the end of next year. The selling pressure from paper investors has been felt

    particularly hard and golds safe-haven status has suffered.

    The United States is an oil exporter again. For the first time in 40 years, a ship loaded

    with U.S. crude oil set sail for foreign shores Thursday. The Bahamian tanker Theo T

    cruised out of the Port of Corpus Christi toward Europe loaded with light crude from

    the nearby South Texas Eagle Ford Shale oilfield. The U.S. banned crude oil exports

    following the oil embargo and gas crisis during the 70s. The ban was lifted as part of a

    budget deal between the president and congress this December. A previously idled

    60-mile pipeline from Pettus to Corpus Christi has been re-activated and two other

    pipelines that previously transported imported oil from the Port of Corpus Christi

    have been reversed to make the export of Texas crude possible. San Antonio's NuStar

    Logistics, which controls the pipeline network is also constructing new docks in

    Corpus Christi in anticipation of expanded exports of Eagle Ford crude. Once

    completed NuStar will be able to load 90,000 barrels of Texas crude per hour. NuStar

    is not alone in its investment in the Port of Corpus Christi. Construction of a $1 billion

    pipe plant is underway as well as a $750 million iron plant which will be fired by

    inexpensive natural gas from the Eagle Ford.

    The boom in Corpus Christi comes as oil prices have crashed and the end of the US

    crude export ban could offer Eagle Ford producers relief.

    USA an oil

    exporter for first

    time in 40 years.

    Copper, Metals

    Sag Most Since

    2008 as Cuts Too

    Late to Save 2015.

    Industrial metals fell, capping the worst year since 2008, as production cuts and signs

    of improving demand in China came too late to counter falling consumption and

    excess supplies. Aluminum, copper, zinc, tin, nickel and lead capped annual losses,

    with nickel dropping 42 percent, the worst performer on the London Metal Exchange

    LMEX Index. The gauge fell 24 percent this year. Copper declined for a third straight

    year, the longest slump since 1998, amid growing supply gluts after demand faltered

    in China, the worlds biggest metals user. While producers in the Asian nation and

    elsewhere have pledged production cuts, investors spooked by wavering global

    economic growth and the possibility of persistent metals surpluses have been slow to

    return. Nine of the nations copper producers have agreed to cut sales by 200,000

    metric tons in the first three months of 2016, people with knowledge of the matter

    said Tuesday. There are still tremendous unknowns, and we will enter the New Year

    with metals not being a favored asset class. Copper for delivery in three months slid

    0.6 percent to settle at $4,705 a metric ton ($2.13 a pound) at 2:50 p.m. on the LME.

    Aluminum, tin and zinc also declined, while lead and nickel advanced. Copper futures

    for March delivery fell 0.5 percent to $2.135 a pound on the Comex in New York.

    Gold Loses

    Luster in Worst

    Slump Since '84

    as Fund Holdings

    Drop.

  • E C O N O M I C C A L E N D E R

    DATE & TIME DESCRIPTION FORECAST PREVIOUS

    Jan 4 4:00am FOMC Member Mester Speaks

    8:15pm Final Manufacturing PMI 51.1 51.3

    8:30pm ISM Manufacturing PMI 49.1 48.6

    8:30pm Construction Spending m/m 0.7% 1.0%

    8:30pm ISM Manufacturing Prices 36.5 35.5

    Jan 5 All Day Total Vehicle Sales 18.1M 18.2M

    Jan 6 6:45pm ADP Non-Farm Employment Change 193K 217K

    7:00pm Trade Balance -44.0B -43.9B

    8:15pm Final Services PMI 55.1 53.7

    8:30pm ISM Non-Manufacturing PMI 56.0 55.9

    8:30pm Factory Orders m/m -0.2% 1.5%

    9:00pm Crude Oil Inventories 2.6M

    Jan 7 12:30am FOMC Meeting Minutes

    6:00pm Challenger Job Cuts y/y -13.9%

    7:00pm Unemployment Claims 271K 287K

    9:00pm Natural Gas Storage -58B

    Jan 8 7:00pm Average Hourly Earnings m/m 0.2% 0.2%

    7:00pm Non-Farm Employment Change 202K 211K

    7:00pm Unemployment Rate 5.0% 5.0%

    8:30pm Wholesale Inventories m/m 0.0% -0.1%

    Jan 9 1:30am Consumer Credit m/m 18.7B 16.0B

  • S1 S2 S3 R1 R2 R3

    24740 24340 24000 25280 25625 26060

    S1 S2 S3 R1 R2 R3

    33000 32500 32000 33875 34550 35140

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

    MCX GOLD showed negative

    movement due to weak dollar and

    faces resistance of trendline on daily

    chart and closed near to its recent low

    of 24740. Now, if it is able to sustain

    below 24740 then next major support

    level is seen around 24450. On higher

    side if it maintains above 25400 then

    again it can correct up to resistance

    level of 26000.

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

    below 24740 for the targets of 24450-

    24000, with stop loss of 25500.

    PIVOT TABLE

    G O L D

    PIVOT TABLE

    S I L V E R

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

    MCX SILVER last week showed bearish

    movement and closed near to its three

    year low which is also an important

    support level i.e. 33000. Now, on lower

    side if it sustains below 33000 then

    next support level is seen in the range

    of 32000-31500. On higher side if it

    maintains above 34000 then only

    correction may seen up to resistance

    level of 35000.

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

    point of time is to sell below 33000 for

    the target of 32000, with stop loss of

    34600.

  • C R U D E O I L

    C O P P E R

    S1 S2 S3 R1 R2 R3

    2400 2275 2000 2580 2710 2855

    S1 S2 S3 R1 R2 R3

    312 305.45 298.80 320 326.10 335.40

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

    MCX Copper last week showed

    sideways movement and maintaing

    above 20 days moving average and

    near to downtrend line. Now, if it

    maintains above 322 then the next

    important resistance level is seen

    around 326. On lower side if it sustains

    below 307 then again downtrend drag

    it up to support level of 295.

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

    buy above 2600 for the targets of 2800-

    2900, with stop loss of 2350.

    PIVOT TABLE

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

    MCX Crude oil showed sideways

    movement after reverting from lower

    band of falling wedge pattern on

    weekly chart and facing resistance of

    upper band of channel pattern. Now, if

    it mainatins above 2600 then next

    important resistance level is seen in

    the range of 2800-2900. On the other

    hand sustaining below 2400, again

    drag it towards the support level of

    2300.

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

    above 322, with stop loss of 307 for the

    targets of 332-335.

    PIVOT TABLE

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