A Slow Day for the Commodities

It was a slow day for the commodities yesterday as there was not any specific major driver for the markets. Most of the moves in the market were an after-effect of the economic news out of the US and Japan on the previous day and hence what we got was a slow ranging day with a grind upwards during the first half of the day and a grind downwards in the prices during the second half of the day.

The events on Wednesday helped Gold break through an important resistance at 1330 and climbed as high as 1343 overcoming the small resistance at 1337. But as the day wore on, USD gained in strength all round and Gold price had a slow grind downwards and has now settled at around 1334 as of this writing. The support at 1330 is key now and we would expect the price to hold in this region under ranging conditions. We should see price action between 1330 and 1345 for today. If there is a strong move downwards, then we would be looking at the usual targets of 1330, 1320 and 1313. We expect the range between 1330 and 1345 to be maintained for today.

Silver had a similar day as it broke through the resistance at 19.85 and went as high as 20.05 before it started to feel giddy. It promptly followed Gold and began a slow grind downwards and has now settled at 19.8 as of this writing.  Like Gold, we expect a ranging market for silver as well for today and we expect the price to hold between 19.67 and 20.05 for the rest of the day unless the USD strength becomes very large and leads to breakdown of the support below.

Oil had a similar journey yesterday as it made its way to 46.6 on the back of USD weakness during the early part of the day but drifted down later and sits at support at 45.95. We expect this range to hold as well till the release of the news from Canada later on in the day. We believe that the Retail Sales and CPI from Canada would have an impact on the Oil price and this news would then determine whether yesterdays range would be broken or not. Till that time, we expect this range to hold.