The yellow metal was lackluster in initial days as investors were cautious on account of U.S. Federal Reserve stance for borrowing rates on Wednesday. Weaken Non-Farm payrolls, falling GDP numbers, flat core retail sales, slippage in Producers Price Index and strong fall in crude oil prices due to weaken demand have acted as a catalyst to thrust the Fed’s chair Jerome Powell for keeping the borrowing costs unchanged along with a dovish tone and pushed gold prices to upside. The neutral stance from Federal’s policymakers fueled the precious metal prices, made it more precious that it crossed the psychological resistance of 34,000 levels. On Friday, the counter witnessed some long liquidation after the MCX Gold priced sensed resistance from 2.414% Fibonacci Extension placed on daily scale.
On daily scale, MCX Gold has formed a ‘Spinning Top’ candle stick pattern, which comprises of a small real body with long shadow either side and signals for an indecisiveness in the sentiments of market participants. The precious metal has formed a Breakaway Gap last week that points the strength of the buyers. Next week, we are expecting a continuation of bull rally once it will cross 34,500 levels to a target of 34,850 and 35,300 levels respectively. RSI is trading at 81.04 levels showing no signs of divergence but closed in overbought zone. Stochastic oscillator is hinting for continuation of uptrend.
MCX Crude Oil
MCX Crude Oil has witnessed a steep rally this week after an unexpected fall in the stockpiles of U.S. crude oil inventories reported by Energy Information Administration and threat by U.S. President Donald Trump to attack on Iran were enough to curb the rising fears of economic slowdown due to lower imports of crude oil in China and slippage of the crude prices below 200 days Exponential Moving Average and thrust the crude oil prices above the psychological resistance of 4,000 levels on daily scale. The greenback government reported that the U.S. stockpiles now stand at 482.39 million barrels on July 14, as the Energy Information Administration reported a drawdown of 3.106 million barrels this week.
On daily scale, MCX Crude Oil has given a breakout of ‘Rectangle’ pattern that signals an expansion of volatility from squeeze after a breakout. The black gold is expected to continue its bullish momentum and find resistance near the trend line placed. RSI is trading at 56.05 levels showing no signs of divergence and oversold while Stochastic oscillator is hinting for more upside.
MCX Natural Gas
MCX Natural Gas remained in the grip of bears last week after Energy Information Administration came with a buildup of natural gas inventories and Nat Gas weather signaled for a moderate to low demand on account of cool shot freeze in Northern and Eastern U.S. Last week, Natural gas inventories failed to beat the expectations of the market and rose less than expected numbers as working gas in storage was leading to a total of 2,203 Billion cubic feet as of Friday, June 14, 2019, which represents a net increase of 115 Billion cubic feet from the previous week contrary to the expectations were for inventories to rise by 102 Billion cubic feet.
On daily scale, MCX Natural Gas has formed a ‘Homing Pigeon’ candle stick pattern that comprises a one large candle followed by a smaller candle with a body is located within the range of the larger candle's body with same color, which signals that the bearish trend is exhaustive. The counter has a strong resistance near the psychological level at 170. RSI is trading at 30.12 levels while Stochastic oscillator is hinting for more downside.