Precious Metals and Commodities Weekly 12th December

Our weekly journey through the precious metals and commodities CFD’s available with OANDA. Jeffrey analyses each using a combination of technical and fundamental analysis.

It’s a central bank frenzy this week, with the SNB, ECB, BOE and a plethora of Latin American central banks all making rate decisions. The highlight, however, will be the Federal Reserve FOMC announcement Wednesday evening with a 0.25% hike baked in. The interesting bit will be the statement with hawkish wording almost sure to weigh on precious metals.

Gold, silver and platinum continue to plunge with gold breaking long-term support at 1260.00. There . The Commitment of Traders (COT) report looking back to last Tuesday shows a massive reduction in speculative longs, and that has no doubt continued over the past few days. Most especially in gold. The RSI’s are oversold on Silver and Platinum offering hope of a dead cat bounce for both. There is much chatter about rotations into Bitcoin from Gold as Bitcoin futures start to trade.

Palladium’s chart maintains its long-term uptrend, but the shorter timescale suggests a welcome downside correction could be on the cards.

Copper seems to be fading and looks set for a more extended correction lower.

Natural gas has seen big wind back of long positioning on the COT report as the warmer weather keeps demand subdued. Natural Gas is testing long-term support, and with a lot of structural long positions still out there, any rally could be more hot air than substance.

Brent and WTI Crude shrugged of corrective selloffs. Brent has exploded higher on North Sea pipeline woes taking out all of its immediate resistance points and setting the scene for higher levels. WTI has been dragged higher on its coattails but has yet to take out a couple of critical resistances towards 59.00. 60+ a barrel will have to wait a while yet.

Sugar rally faltered without seriously testing 0.15000.Prices have collapsed over the last week as longs are reduced leaving sugar exactly mid-range between 0.15000 and 0.12500. Dust of the range trading strategies and ignore the intra-week noise.

Corn’s continues to be marooned mid-range between 3.2950 and 3.4800. Either follow the instructions above or bring a good book to read.

Soybean’s continue to tease and disappoint.  The beans broke above the top of the triangle only to fail once again. It sets up a test of the base of the triangle at 9.6900. Ominously, the COT showed long positioning increasing even as prices kept falling. The catch a falling knife strategy is for the brave only…..

Wheat has a large open short position on the futures and for an excellent reason. Wheat’s global harvest weighs on prices as it broke support at 4.0340 and now is testing long-term support at 3.9230. Near-term resistance is at 4.1700.

Gold 00:00:00, Silver 00:04:40, Platinum 00:06:00, Palladium 00:07:20, Copper 00:09:30, Natural Gas 00:10:50, Brent Crude 00:12:45, WTI Oil 00:15:20, Sugar 00:17:20, Corn 00:17:00, Soybeans 00:20:15, Wheat 00:22:00

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Currency Analyst
Based in Singapore, Jeffrey has over 25 years experience in the financial markets, having traded currencies, options, precious metals and futures. Jeffrey started his career at Barclays Bank in New Zealand. However he has spent most of it in London and Asia.Jeffrey focuses on the Asia time zone across asset classes. A regular commentator on business news TV and Radio, he is originally from New Zealand and holds an MBA from Cass Business School, London.