Crude Oil Sold, Gold Supported as All Eyes Turn to US Data Docket

DailyFX

Talking Points

  • Crude Oil, Copper Decline on Fears US Data to Show Growth Slowdown
  • Gold and Silver Supported as QE3 Hopes Boost Inflation-Hedge Demand

Commodities prices are yielding mixed results in European trade, with growth-geared crude oil and copper prices are ticking lower while gold and silver are little changed. Price action likely reflects pre-emptive positioning ahead of the day’s docket of US economic data.

Durable Goods Orders and Pending Home Sales growth is forecast to slow in June, weighing on demand expectations for cyclically sensitive commodities. Precious metals are holding up as signs of slowdown stoke Fed stimulus hopes and boost demand for alternative store-of-value assets amid fears of further dilution of the US Dollar.

The Kansas City Fed Manufacturing Activity survey may offer a bit of an offset, with expectations calling for a mild improvement in July. Comments from US Treasury Secretary Tim Geithner may prove to be a wildcard as he testifies to the Senate Banking Committee on the impact of the on the Eurozone debt crisis.

WTI Crude Oil (NY Close): $88.97 // +0.47 // +0.53%

Prices are testing support in the 87.65-88.32 area, marked by the July 3 closing high and the 14.6% Fibonacci expansion. A break downward initially exposes the 23.6% level at 85.37. Near-term resistance lines up at 93.21, the July 19 high.

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Crude_Oil_Sold_Gold_Supported_as_All_Eyes_Turn_to_US_Data_Docket_body_Picture_3.png, Crude Oil Sold, Gold Supported as All Eyes Turn to US Data Docket

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1604.45 // +23.50 // +1.49%

Prices took out resistance at 1588.90 to expose falling trend line resistance now at 1604.26. A break above this level exposes swing highs at 1624.81 and 1633.80. The 1588.90 level has been recast as near-term support, with a break back below that aiming to challenge rising trend line barriers at 1576.29 and 1561.70.

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Crude_Oil_Sold_Gold_Supported_as_All_Eyes_Turn_to_US_Data_Docket_body_Picture_4.png, Crude Oil Sold, Gold Supported as All Eyes Turn to US Data Docket

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $27.36 // +0.38 // +1.39%

Prices are testing falling trend line resistance set from early March, with a break higher exposing the July 3 high at 28.44. Near-term support remains at 26.75, with a break below that exposing the major triple bottom at 26.05.

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Crude_Oil_Sold_Gold_Supported_as_All_Eyes_Turn_to_US_Data_Docket_body_Picture_5.png, Crude Oil Sold, Gold Supported as All Eyes Turn to US Data Docket

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.354 // -0.026 // -0.77%

Prices continue to test resistance in the 3.378-90 area marked by the July 10 daily close and the 23.6% Fibonacci expansion. A clear break higher exposes the 14.6% level at 3.445. Trend line support comes in at 3.334, with a push below that targeting the 38.2% Fib at 3.269.

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Crude_Oil_Sold_Gold_Supported_as_All_Eyes_Turn_to_US_Data_Docket_body_Picture_6.png, Crude Oil Sold, Gold Supported as All Eyes Turn to US Data Docket

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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