WTI and gold resume their descents as copper rallies post US President Day
Outlook on WTI crude oil, gold and copper ahead of Wednesday’s Fed minutes.
WTI crude oil drift lower continues
WTI crude oil has resumed its descent on Tuesday morning, having recovered slightly in low volume trading on Monday when US markets were shut for President’s Day.
Last week’s low at $75.33 remains in focus amid heightened geopolitical tensions due to North Korea firing a long-range ballistic missile on Saturday and as the Reserve Bank of Australia (RBA) minutes earlier today showed that the central bank remains hawkish, worrying investors that other central banks will remain on their tightening paths as well.
A drop through $75.33 would eye the late November low at $73.67 below which the January and February lows at $72.64 to $72.50 might be back in the picture, together with the $70.25 December low.
Immediate resistance can be spotted along the 55-day simple moving average (SMA) at $77.63 and further up at the 19 January low at $78.45.
Gold remains under pressure
The speed of the decline in the price of gold from its nine-month high at $1,959 per troy ounce is slowing down but nonetheless it last week reached the early to mid-December highs at $1,824 to $1,810 which acted as interim support.
This support zone remains in sight, though, with a fall through it eyeing the November peak at $1,786 and the 200-day SMA at $1,776 which may offer support.
Minor resistance sits at Monday’s $1,847 high and can be seen along the 55-day SMA at $1,857 as well as at the 3 February low at $1,862.
While no bullish reversal takes the price of the precious metal above its mid-February high at $1,870, the February downtrend remains firmly entrenched.
Copper recovers from mid-February low
Copper is seen bouncing off its mid-February low at $8,787 per ton as traders expect China’s re-opening to lead to more demand for the industrial metal with the 19 January low at $9,166 representing the first upside target ahead of the 23 and 27 January highs at $9,395 to $9,439 and then the January peak at $9,951.
Minor support is seen at the recent daily highs at $9,064 to $9,055 ahead of Wednesday’s US Federal Reserve (Fed) minutes with more significant support coming in at the $8,809 to $8,787 early and mid-February lows.
While these underpin on a daily chart closing basis, the medium-term uptrend in copper remains intact.
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