Technical Analyst, Saxo Bank
Summary: Across the board metals seem to have found strong support and have formed technical bottom and reversal patterns.
Gold XAUUSD is a bit less convincing than other metals. However, on Daily time period the precious metal has established a short term uptrend (higher highs and higher lows). 200 Simple Moving Average seems to be a resistance. However, if Gold can break above USD 1.810/oz there is strong resistance at around USD1.834. That level is likely to be crucial for Bulls/Bears. If rejected Gold could slip back in to the 1.700’s. If breaking above 1.834 May high at around 1.900 is in play.
Break below support at USD 1.745, 1.725 is next (stronger) support.
On the Weekly time period Gold is in the process of forming a Descending Triangle like pattern which could be a big corrective formation. However, for medium/longer term direction a break out is needed. A break above strong resistance at 1.834 is likely to lead to a bullish break out leading to significantly higher levels in the future.
Silver XAGUSD seems to have formed an Inverse Shoulder- Head-Shoulder pattern with rather flat Shoulders and Neckline, however, a bit unusual. A close above the Neckline confirms the break out with potential to around USD 24.85/oz. It most likely wouldn’t be without a struggle since there is some resistance from the 55 SMA coming down.
A close below the right shoulder low at USD22.20 will demolish the rebound scenario.
Platinum has formed an Inverse Shoulder- Head-Shoulder pattern, broken above the neckline and is now set for higher levels. Measuring from the Head to the Neckline give us a price target around USD 1.100 which is also roughly where the 200 Simple Moving is offering some resistance.
A close below the right shoulder low at 939 will demolish the rebound scenario.
Palladium
After being range bound between USD 1.827 and 2.080 for a few weeks Palladium closed above the resistance and could be set for a push higher. If the move should be as big as the range (2.080-1.827 = 253) we could see Platinum reach USD 2.333 which is close to the 76.4 Fibo retracement of the September sell-off. There is however, resistance at around 61.8 retracement at around 2.243 where 55 SMA also seems to offer some resistance.
Strong resistance at around USD 2.500. A close below 2.028 is likely to demolish the rebound scenario.
Copper has broken out of a triangle like pattern and above strong resistance at around USd 447/t. Next resistance at around 432.75. However, this break out could test previous All time highs at around 488.80.
On the weekly chart Copper is close to break back above the rising trend line. RSI has broken its falling trend and is close to be breaking back above 60 threshold with no divergence meaning seeing new highs is not unlikely.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.