Fastmarkets calculated the weekly copper concentrate TC index, cif Asia Pacific at a discount of $4.10 per tonne on Friday, down from a discount of $3.80 per tonne in the preceding assessment and a new record low since Fastmarkets began tracking the price in 2013.

“The market is a bit quiet, with smelters seemingly not eager to buy, but there is also little rebound in spot TCs,” one market participant said.

Market participants also added recent support from ample supplies of blister copper and anodes in China’s domestic spot market has allowed some smelters to reduce the use of copper concentrates while largely maintaining refined copper production.

“Domestic supplies of blister copper and anodes made of copper scraps are increasing notably, and the two are becoming more competitive due to cheaper prices and easily accessible compared to copper concentrates,” a second market participant said.

More supplies of blister copper have also reduced demand for imported blister copper, with minimal buying interest despite higher offers, sources told Fastmarkets.

“There is no interest in importing blister copper now, with refining charges [RCs] for domestic units rising to 2,200 yuan [roughly $270] per tonne in some regions, much better than those for imported units,” a third market participant said.

Fastmarkets’ monthly price assessment of copper blister 98-99% RC, spot, cif China was $160-200 per tonne on May 31, up from $100 per tonne in April.

Elsewhere, Chilean copper miner Antofagasta met Chinese copper smelters this past week for the first round of copper concentrates supply talks, but no agreed upon figures have been announced, sources told Fastmarkets.

“There is market consensus on supply shortage of copper concentrates, and the severity of the shortages may vary. Supply talks have just begun ,[and] I heard the miner tentatively offers [of TCs] at $10 [per tonne], but smelters haven’t given their numbers yet,” a fourth market participant said.

Other coverage:
BHP shuts up, for now: Hotter Commodities

BHP’s bid for Anglo American fails but can high copper price increase supply?

US copper premium rises; high exchange prices keep Asia, London markets flat

Inform your base metals strategy with metals price forecasts and analysis for the global base metals industry. Get a free sample of our base metals price forecast today.

Natural Gas Price Forecast Video for 01.02.23

Natural Gas Technical Analysis

Natural gas markets have done very little during the trading session on Tuesday as we continue to hang around the very lows of this massive selloff. At this point, we are trying to find some type of reason for natural gas to go higher, and as I currently look outside, it is 17°F. For those of you not in the United States, that translates to -8.333 Celsius. That being said, even with the cold weather in the US, we just don’t have enough demand to send this higher. This is mainly due to the fact that the Freeport LNG export terminal is up and running.

Beyond that, it’s been a relatively mild winter in both the United States and the European Union, which of course helps natural gas prices drop as well. The market has been very noisy along the way, and I do think that eventually we will get some type of bear market bounce. That being said, I’m not looking to buy this market but rather I’d be looking to short this market after that bear market bounce.

With that in mind, I think we’ve got a situation where you are going to have to be very patient. As you can see, the angle of the trajectory is starting to slow down, so that at least suggests that a lot of the pressure is starting to abate. That being said, if we were to break down below the $2.40 area, then the market could go all the way down to the $2.00 level. Do not get me wrong, someday there is going to be a great trade here, right now unless you are short already, you are just simply fading short-term rallies at best.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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This document provides a basic overview of the industry, covering its definition, applications, and manufacturing technology. Further details about the main players in the global sector are included in the study. There are primary and secondary data sources in the research report on the global Fully Automatic Coffee Machines Market. During the research process, a variety of factors that affect the industry are examined, including legislation, market conditions, competitive levels, region, historical data, market conditions, technological improvements, and projected developments.

Decline Follows Failed Breakout Above the 20-Day MA

The decline today follows a successful test of resistance around the 20-Day MA and top trendline over several days earlier this week. Given that the June 24 swing low at 2.635 failed to hold as support today, it looks like the 200-Day MA around 2.47 will be tested as support before the retracement is complete.

Notice that the 50-Day MA has almost converged with the 200-Day line thereby confirming potential support around the 200-Day line. If the 200-Day line fails to act as support, lower potential targets are identified at the 50% retracement and 61.8% Fibonacci retracement at 2.37 and 2.18, respectively.

Drop to 200-Day MA More Likely

When measuring the full upswing beginning from the April 25 swing low, the 38.2% retracement shows at 2.55. But given the rejection of the price of natural gas as the 20-Day line and subsequent bearish reaction, it is at risk of being broken. Further, this week’s swing high of 2.86 established the BC leg of a descending ABCD pattern.

The pattern completes below the 200-Day MA and near the 50% retracement at 2.34. This would seem to increase the risk of a potential decline below the 200-Day line. The 200-Day line was successfully tested as support on May 28, shortly after natural gas rallied back above the line on May 16. If it falls back below the line and then stays below it, the correction is likely to continue with a deeper retracement or consolidation.

Lower Support Zone Starts Around 2.235

A lower potential support zone, below the 50% retracement, is identified from around 2.235 to 2.18. This week is on track to end, completing the second week down from the June 10 high. Moreover, selling continues to dominate into Friday afternoon. Therefore, next week natural gas is at risk of continuing the bearish decline.

For a look at all of today’s economic events, check out our economic calendar.

• Gold managed to hold above $2,300 despite broad US Dollar strength.
• The technical outlook highlights XAU/USD’s indecisiveness in the near term.
• Fed Chairman Powell’s speech and key macroeconomic data releases from the US could help Gold find direction next week.

Gold (XAU/USD) came under bearish pressure and declined below $2,300 on Wednesday after starting the week in a calm manner. The pair, however, managed to recover its losses on Thursday and stabilized above $2,320. Federal Reserve (Fed) Chairman Jerome Powell’s speech at the European Central Bank’s (ECB) Forum on Central Banking in Sintra on Tuesday and key macroeconomic data releases from the US, including the June jobs report, could help Gold break out of its range next week. 

Gold has yet to decide on next direction

In the absence of high-tier macroeconomic data releases, the cautious market mood and hawkish comments from Fed officials allowed the US Dollar (USD) to stay resilient against its rivals and made it difficult for Gold to gain traction at the start of the week. Meanwhile, the data from the US showed on Tuesday that the Conference Board (CB) Consumer Confidence Index edged lower to 100.4 in June from 101.3 in May, while the Present Situation Index improved to 141.5 from 140.8 in the same period.

Fed Governor Michelle Bowman said on Tuesday that they are not yet at the point where it is appropriate to cut interest rates, adding that she is willing to raise rates at a future meeting if inflation progress were to stall or reverse.

The benchmark 10-year US Treasury bond yield gathered bullish momentum late Tuesday following Bowman’s comments and continued to push higher on Wednesday. In turn, XAU/USD dropped below $2,300 for the first time in two weeks.

Mixed data releases from the US opened the door for a rebound in XAU/USD on Thursday. The Bureau of Economic Analysis (BEA) announced that it revised the annualized Gross Domestic Product (GDP) growth for the first quarter to 1.4% from 1.3% in the previous estimate. On a negative note, Durable Goods Orders ex Defense declined 0.2% in May after staying unchanged in April, while Pending Home Sales contracted by 2.1% on a monthly basis in May, highlighting worsening conditions in the housing market.

The BEA reported on Friday that inflation in the US, as measured by the change in the Personal Consumption Expenditures (PCE) Price Index, edged lower to 2.6% on a yearly basis in May from 2.7% in April, as expected. On a monthly basis, the PCE Price Index was unchanged in May, while the annual core PCE Price Index, which excludes volatile food and energy prices, rose 2.6% in the same period, down from the 2.8% increase recorded in April. Finally, the monthly core PCE Price Index rose 0.1%. The USD struggled to find demand following the PCE inflation data, allowing gold to cling to its daily gains in the American session on Friday.

Gold investors await Powell speech, key US data

The ISM Manufacturing Purchasing Managers Index (PMI) data for June will be featured in the US economic docket on Monday. The headline PMI is forecast to improve to 49 from 48.7 in May. A reading above 50, which would point to a return to expansion in the sector’s business activity, could support the USD and limit Gold’s upside in the American trading hours.

On Tuesday, the Bureau of Labor Statistics (BLS) will release the JOLTS Job Openings data for May. Investors are likely to ignore this report and stay focused on Fed Chairman Jerome Powell’s speech at the ECB’s Forum on Central Banking. This will be Powell’s first public appearance since he spoke at the press conference following the June policy meeting.

If Powell voices a preference for a single rate hike this year, the initial reaction could provide a boost to the USD. On the other hand, investors could remain hopeful about an interest rate cut in September if Powell reiterates the data-dependent approach and refrains from dismissing the possibility of a policy pivot before the end of the year. According to the CME FedWatch Tool, markets are currently pricing in a 36% probability of the Fed leaving the policy rate unchanged in September.

Weekly Initial Jobless Claims, ADP Employment Change and the ISM Services PMI data will be released on Wednesday. Investors might remain reluctant to take positions based on these data because stock and bond markets will remain closed in observance of the July 4 holiday on Thursday. More importantly, the BLS will publish the June jobs report on Friday, which will include Nonfarm Payrolls (NFP), Unemployment Rate and wage inflation figures. 

Late Wednesday, the FOMC will release the Minutes of the June policy meeting. The publication is unlikely to offer any fresh clues regarding the Fed’s interest rate outlook.

Following the stronger-than-forecast increase of 272,000 in May, NFP is expected to rise 180,000 in June. The Unemployment Rate is seen holding steady at 4% and the wage inflation, as measured by the change in the Average Hourly Earnings, is anticipated to grow 0.3%, down slightly from 0.4% growth in May. Unless there is a significant downward revision to the May NFP print, an increase of 200,000 or more in June could help the USD outperform its rivals ahead of the weekend. On the flip side, an increase of less than 150,000 could be seen as a sign of loosening conditions in the labor market and cause the USD to lose interest. In this scenario, XAU/USD is likely to end the week on a bullish note.

Gold technical outlook

The Relative Strength Index (RSI) indicator on the daily chart moves sideways near 50, highlighting a lack of directional momentum. Although Gold held above $2,300 (psychological level), it has yet to clear the 50-day Simple Moving Average (SMA), currently located near $2,340. If XAU/USD rises above this level and confirms it as support, technical buyers could take action. In this scenario, $2,380 (static level) could be seen as the next resistance before $2,400 (psychological level, static level).

On the downside, additional losses toward $2,280 (static level) and $2,265-$2,255 (Fibonacci 38.2% retracement of the mid-February-June uptrend, 100-day SMA) could be seen if $2,300 support fails.

 

• Gold price returns to the red early Friday, awaiting US PCE inflation data. 
• The US Dollar follows the USD/JPY and Treasury bond yields higher even as the mood improves.  
• The fate of Gold price hinges on the top-tier US data but downside risks remain intact.

Gold price has snapped its rebound from two-week lows early Friday, losing ground after running into offers near the $2,330 resistance again. The next direction for Gold price now remains in the hands of the US Personal Consumption Expenditure (PCE) inflation data.

All eyes remain on US PCE inflation data and Japan’s intervention risks

Gold price is back in negative territory in Asian trading on Friday, as the US Dollar extends Thursday’s late rebound and recovers lost ground on the back of the resumption of the USD/JPY uptrend and rising US Treasury bond yields.

Higher US Dollar and US Treasury bond yields trigger a fresh bout of selling in the non-yielding Gold price. Additionally, traders turn cautious and refrain from placing fresh bets on Gold price heading into the US inflation showdown.

The US annual PCE Price Index is seen rising 2.6% in May, compared to a 2.7% increase in April while the Federal Reserve (Fed) preferred inflation measure, the core PCE figure, is expected to accelerate by 2.6% YoY, slowing from a 2.8% growth in April.

If the inflation data points to slowing price pressures, Gold price is likely to regain its recovery momentum, as the US Dollar would come under strong selling pressure on increased bets for a September rate cut. On the contrary, the US Dollar could stretch its recent advance and weigh on Gold price should the data surprise to the upside.

Markets are now pricing in about a 64% chance of a Fed rate cut in September, a tad higher than the 62% seen Thursday, according to CME FedWatch Tool.

Meanwhile, the first US presidential election debate in the showdown to the November 5 polls had little to no impact on the value of the US Dollar and that of Gold price.

On Thursday, mixed US growth, Durable Goods Orders and housing data exerted downward pressure on the US Dollar. The Greenback already bore the brunt of the correction in the USD/JPY. This helped Gold price stage a decent comeback from two-week troughs under $2,300.

Further, Fed Governor Michele Bowman’s change of words exacerbated the buck’s pain. Bowman said, “I am still willing to raise rates again if inflation doesn’t ease.” Atlanta Fed President Raphael Bostic also delivered dovish remarks, suggesting that an interest rate cut in the fourth quarter was likely, with inflation moving in the right direction.  

Gold price technical analysis: Daily chart

 

Gold price downside remains intact, despite the previous rebound, as the 14-day Relative Strength Index (RSI) remains below the 50 level.

Therefore, any rebound in Gold price continues to remain a good selling opportunity.   

Adding credence to the bearish potential, the previous week’s 21-day Simple Moving Average (SMA) and the 50-day SMA bearish crossover continues to act as a headwind.

If sellers extend control, the $2,300 threshold will be put to test once again, below which the June low at $2,287 could come to the buyers’ rescue.

Further down, the May 3 low at $2,277 will come into play.  

Alternatively, Gold price needs to take out the 21-day SMA at $2,328 on a daily closing basis to resume the recovery from the monthly low of $2,287.  

Further up, the 50-day SMA at $2,338 will be eyed, followed by the two-week high of $2,366.

Gold FAQs

Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.