Analysis of Gold News: On Tuesday (October 16th), in the US market, retail sales growth in September exceeded expectations, but gold prices rose due to tensions in the Middle East boosting safe haven demand for gold. The speech by Federal Reserve Chairman Jerome Powell later this week will further clarify the interest rate path. The latest released data shows that the monthly retail sales rate in the United States recorded 0.7% in September, more than twice the expected growth rate of 0.3% on Wall Street. Excluding cars and natural gas, sales increased by 0.6%, higher than Bloomberg's 0.1% growth forecast. Meanwhile, sales in August increased from the previously reported 0.6% increase to 0.8%. After the data was released, spot gold fell to around 1920 and then rebounded to the intraday high of 1931.57. It is currently trading at $1928.17 per ounce, up 0.41%. As the humanitarian crisis in Gaza worsens, US President Biden will conduct a high-risk visit to Israel on Wednesday. During periods of political and financial uncertainty, gold is often used as a security investment, and as the Middle East conflict intensifies, it has risen by over 4% so far in October. Investors are also looking forward to Powell's speech on Thursday, which may provide more clues to the Fed's monetary policy path after several Fed officials have recently made dovish remarks. If there are signs that the Federal Reserve is about to end this interest rate hike cycle, it will be beneficial for gold, even if we will not cut interest rates soon. It is worth noting that the retail sales growth in the United States in September exceeded expectations, indicating the strong end of the third quarter of the economy. Although the Federal Reserve has taken interest rate hikes in search of cooling inflation, the economic data is still significantly stronger than expected. Although wage growth has begun to lose momentum, the labor market remains generally strong, providing Americans with room to continue spending. In September, with price data showing stubborn inflation, the continued strong consumer demand may prompt the Federal Reserve to raise interest rates again before the end of the year. Technical analysis of gold: Although gold opened slightly lower during the day, there was no significant correction adjustment, and the lower low point only reached the 1912 line. This strong state clearly indicates that the current focus of the market is still on the situation between Palestine and Israel. In the current market, the expected conflict may escalate. The trend of gold daily level: Yesterday, a negative K-line with a downward shadow was closed, This is a correction after last Friday's super positive line. This means that after the correction is over, there is still a possibility for gold prices to further strengthen and break through. It is recommended to pay attention to the suppression of tracks on the channel near 1932 and 1945. The support below is located near the 66th day moving average position 1913 and the annual moving average position 1907. The 5-day moving average is currently moving up to around 1902-03, which is an important support level. Overall, gold still tends to remain bullish after stabilizing its support level. The trend of the gold 4-hour level: the key mid rail support level has moved up to the 1900 line, which resonates with the annual moving average. The resistance above is still around 1932, and there is a possibility that gold will further break through upwards if it waits for a high level sideways move. The short-term trend of gold: Since last night, the gold price is still in the consolidation stage. And at the end of the convergence triangle. If the gold price effectively stabilizes above 1920, it is expected to hit last week's high near 1932. Once it breaks through this position, it will further impact around 1945 47. Overall, there is a bullish trend. According to the current daily and hourly chart structure of gold, the bullish expectation for gold in the evening is still maintained. However, the short-term rise may still rely on the market's safe haven sentiment, and there may be some technical short-term pressure in the upper 1930. If the news is too light, the US data and Fed officials' speeches may have a certain negative impact on gold bulls, but it is only a short-term impact, It is difficult to change the bullish expectations of hedging at a large level of fundamentals. The bullish trend of gold has been maintained and is bullish today to 1940-48. On Tuesday, gold fell first and then rose, confirming a pullback support point of 1912. At present, the rise has exceeded the previous high of 1930, but it has been determined that the pullback is weak and the adjustment is over. Therefore, we will continue to be bullish on gold in the future.
The upper short-term focus is on the resistance on the 1943-1945 front line, while the lower short-term focus is on the support on the 1910-1912 front line.
Analysis of crude oil news: On Monday (October 16th) in the US market, crude oil prices were trading around $86.81 per barrel. Crude oil prices reversed after a significant increase in the previous week, closing below $90 per barrel due to signs that the global oil supply situation may improve. In addition, there were also some long profit taking in US crude oil after the 21st day moving average was blocked. Due to potential supply disruptions in the world's largest oil producing region due to anticipated conflicts, crude oil prices have risen after significant fluctuations last week. But this is to some extent offset by signs of cooling demand and increasing production in the United States. Due to the market's attention to any signs of a broader conflict triggered by the Palestinian-Israeli conflict, both major contracts rose by 6% to 8% last week. The uncertainty and concerns about the escalation of the Israeli-Palestinian conflict continue to support the oil market. In recent days, Iran has issued warnings about the risk of a broader conflict, and there have been reports that Saudi Arabia has frozen negotiations to normalize relations with Israel. The US Energy Information Agency (EIA) has stated that US shale gas production is expected to decline by 451 million cubic feet per day in November, and oil production in the Permian Basin will decline to its lowest level since April, In November, the oil production of major shale basins in the United States will experience the largest decline since December 22 of last year. In response to the supply-demand contradiction, European Central Bank President Lagarde told Eurozone finance ministers that the European Central Bank is paying attention to any inflation risks posed by the new round of Israeli-Palestinian conflict through oil price fluctuations.
On Tuesday (October 17th), oil prices slightly rose as investors watched as the US diplomatic efforts and President Biden's visit to Israel could prevent the escalation of the Middle East conflict.
Biden will visit Israel on Wednesday to seek a balance between supporting Israel's war against Hamas and attempting to woo Arab countries to help prevent regional conflicts. Earlier, Iran, a member of the Organization of Petroleum Exporting Countries (OPEC), vowed that its "resistance front" allies, including Hezbollah in Lebanon, would take "preemptive action". OANDA Senior Market Analyst Edward Moya said, "Oil prices are fluctuating, and energy traders are watching to see if US diplomatic efforts can successfully prevent the Israeli Hamas conflict from escalating into a broader regional war
Galipolo, Vice President of the Brazilian Central Bank, stated that "the conflict between Palestine and Israel has raised additional concerns about oil prices and foreign exchange rates." Federal Reserve official Thomas Barkin said that the rise in long-term borrowing costs in the United States is putting downward pressure on demand, but it is currently unclear how this will affect the central bank's interest rate decision within three weeks. Raising interest rates to curb inflation may slow down economic growth and reduce oil demand. Due to concerns that the conflict between Israel and Hamas may expand to oil producing areas, both oil benchmark indices rose last week. The global benchmark Brent crude oil rose 7.5%, marking its largest weekly increase since February. Due to an increase in household purchases of motor vehicles and increased consumption in restaurants and bars, retail sales in the United States exceeded expectations in September, providing some support for crude oil prices. The contradiction between crude oil supply and demand is one of the factors affecting crude oil prices. The Russian Central Bank has stated that oil production in Iran and Venezuela, which are not subject to OPEC+quota restrictions, may significantly slow down. If the global oil supply shortage worsens, OPEC+will discuss the possibility of increasing oil production in early 2024. Russian Deputy Prime Minister Novak stated that it is still too early to discuss OPEC's decision for November. Multiple sources have stated that due to the possibility of increased supply putting pressure on prices, the Venezuelan government and opposition will resume long-term suspended negotiations on Tuesday, which may lead to a relaxation of sanctions in Washington. Former US Ambassador to Venezuela, Patrick Dadi, said: "The global economy wants to see Venezuela once again become a participant in the world oil market." Saudi Aramco CEO Amin Nasser said that if needed, the world's largest oil company may increase production within a few weeks. Nasser stated that global oil demand is expected to increase to 103 million barrels in the second half of this year, while the company's idle capacity is 3 million barrels per day. Price Futures Group analyst Phil Flynn said, "The market is currently very tight, which is why we are so nervous." "Even if OPEC increases production, they can only increase production by up to 3 million barrels per day. This is a terrible number." OPEC+, composed of OPEC countries and major allies including Russia, has been reducing production since last year, reportedly taking preemptive action to maintain market stability. In terms of supply in the United States, market sources cited data from the American Petroleum Institute on Tuesday, stating that industry data showed that as of October 13th, the original?? The decrease in oil storage is approximately 4.4 million barrels. Angola has a preliminary plan to export 1.13 million barrels per day of crude oil in December. According to the Iranian Ministry of Petroleum News Agency, Iran and Belarus have signed a memorandum of understanding on cooperation in the field of oil and petrochemicals. The Russia Ukraine crisis and the Palestine Israel conflict have further affected crude oil prices in terms of political environment. Israeli officials say the conflict between Palestine and Israel may take months or even years. Various countries have implemented different measures to address the volatile crude oil prices. The Indian government has announced that starting from October 18th, it will lower the crude oil windfall tax from 12200 rupees/ton to 9050 rupees/ton, lower the diesel windfall tax from 5 rupees/liter to 4 rupees/liter, and increase the aviation turbine fuel windfall tax from 3.50 rupees/liter to 1 rupee/liter. According to people familiar with the transaction, Mexico has been implementing its annual oil export hedging plan - by purchasing put options and selling crude oil at predetermined prices, the hedging process may be imminent or completed. Mexico has always set its oil price hedging target at around $80 per barrel. Mexico's "Hacienda Hedge" has always been one of the world's largest sovereign oil hedges, valued at approximately $1 billion. According to data compiled by institutions, the first signs of the hedging process appeared in August, when the months long decline in volatility suddenly stopped. Since then, volatility has steadily increased, but this volatility has also been driven by periods of turmoil in the oil market - with oil prices rapidly rebounding between $85 per barrel and $100 per barrel. Investors continue to wait for US diplomatic efforts and whether President Joe Biden's visit to Israel will prevent the escalation of the Middle East conflict. Biden's visit to Israel on Wednesday will seek balanced support for Israel's war against Hamas and attempt to unite Arab countries to help prevent regional conflicts.
Technical analysis of crude oil: Yesterday, crude oil underwent a minor negative correction and continued to rebound slightly in the short term before undergoing pressure testing. The daily line did not further connect to the positive, and some small negative lines stepped back to gather momentum. The daily K-line structure still tends to be bullish and stable, with only a slightly slower short-term trend and a longer period of consolidation and accumulation. The daily line uses 81.30 as the bottom rebound defense point, which is bullish above this level. The 4-hour chart structure is still in a stable upward trend with a double bottom, and there was no further upward trend yesterday. However, there is not much room for a pullback, which belongs to the transition of consolidation and correction. The double bottom low point is a defensive point for bulls, and it has now moved away from a relatively long distance. The short-term operation is so radical that it still retreats much lower. Conservative, wait for the second time to stabilize at 88.30 and then take advantage of the trend to be bullish. At the current stage of consolidation, it is also confirmed that there is a detour in the process of bottoming out and rebounding, which cannot be ruled out. The current short term position is relatively difficult to set as a long loss position. Combined with the temporary arrangement of hourly K-line form.
The upper short-term focus is on the front line resistance of 89.9-89.7,
Pay attention to the frontline support of 86.5-86.8 in the short term below.
