Crude oil may fall amid broad-based risk aversion while gold
pushes higher amid US Dollar selling if US ISM and NFP data fall
short of economists' expectations.
Talking Points
- Crude Oil, Copper May Fall if NFP and ISM Data
Disappoints
- Gold and Silver Could Rise as US Data Weighs on US
Dollar
All eyes are on the US economic calendar in the final hours of
the trading week. The Employment report is expected to show Nonfarm
Payrolls (NFP) rose 165,000 in January, compared with a 155,000
increase in the prior month. Meanwhile, the ISM Manufacturing gauge
is expected to tick narrowly higher to 50.6 over the same period
versus 50.2 in December.
Outcomes in line with expectations would fall closely in line
with recent trends, offering little that has not been priced in
already and implying limited scope for market volatility. US
economic releases have increasingly underperformed analysts'
forecasts since late December however (according to data compiled
by Citigroup). This seems to suggest market observers' perceptions
are rosier than they ought to be.
If this trend continues and brings disappointments on today's
releases, a breakout of risk aversion across financial markets amid
worries about the implications of a slowdown in the world's largest
economy for global recovery at large. That bodes ill for
cycle-sensitive commodities including crude oil and copper . It may
likewise weigh on the US Dollar by scattering expectations for an
early end to the Fed's QE efforts , offering support to anti-fiat
assets including gold and silver .
WTI Crude Oil (NY Close): $97.49 // -0.45 // -0.46%
Prices cleared resistance at 97.41, exposing the 100.00 figure
and the September 14 high at 100.40. Negative RSI divergence warns
of ebbing bullish momentum however and hints a reversal may be
brewing. A bearish Dark Cloud Cover candlestick pattern is likewise
in play, although confirmation would require a clear back below
97.41. Such an outcome initially exposes 94.61.
Daily Chart - Created Using
FXCM Marketscope 2.0
Spot Gold (NY Close): $1663.65 // -13.40 // -0.80%
Prices once again find themselves near major rising trend line
support dating back to mid-May (1655.05), but a bullish Morning
Star candlestick pattern continues to argue for an upside bias.
Near-term resistance is at 1690.39, the 38.2% Fibonacci
retracement, followed by the 1700/oz figure and a channel top at
1700.68. Alternatively, a drop below support targets the January 4
low at 1625.69 and the falling channel bottom at 1602.09.
Daily Chart - Created Using
FXCM Marketscope 2.0
Want to learn more about RSI?
Watch this Video
Spot Silver (NY Close): $31.45 // -0.59 // -1.83%
Prices are edging higher in a narrow upward-sloping channel.
Near-term resistance lines up at 32.65, the channel top and a
horizontal pivot. A break above that aims for the upper boundary of
a larger channel top at 33.41. Near-term support is at 30.95, with
a drop below that aims for the 30.00 figure and the major channel
bottom at 29.19.
Daily Chart - Created Using
FXCM Marketscope 2.0
Want to learn more about RSI?
Watch this Video
COMEX E-Mini Copper (NY Close) : $3.732 // -0.018 // -0.48%
Prices are testing below the 38.2% Fibonacci expansion at 3.736
once again. A break lower exposes a rising Wedge bottom at 3.658.
Near-term resistance is at 3.778, 50% level, with a reversal above
that aiming for the 61.8% Fib at 3.820.
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
To be added to Ilya 's e-mail distribution list, please
CLICK HERE
forex news
currency trading