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ICBC Trading Strategies of Precious Metal and Commodity Markets - November 16, 2018

I. Precious Metal Market
Gold hit a near one-week peak on Thursday as investors sought cover from market turmoil after Britain’s long-awaited draft agreement to leave the EU was thrown into chaos, helping the metal hold its ground against a rising dollar. British Prime Minister Theresa May battled to save a draft divorce deal with the EU after her Brexit secretary and other ministers quit in protest and Eurosceptic lawmakers stepped up efforts to topple her. Spot gold was up 0.2% at USD1,213.60 per ounce within the day after touching its highest since November 9 at USD1,216.27 earlier in the session and moving away from a one-month low of USD1,195.9 hit on Tuesday.
On the technical front, spot gold rose for the third consecutive session at a rate less than the previous session, mainly due to the suppression of the upper 100 day moving average. The lower 50 day moving average was expected to continue to support short swing. It was close to touching the above-mentioned moving average lines. If the gold price can rise to shake off the suppression of the 100 day moving average of USD1213.81, room for upturn can be anticipated.
Silver was up 0.6% at USD14.21 per ounce on Thursday. It fell to USD13.85 in the previous session, a level last seen on January 21, 2016. Silver prices continue to rebound with gold prices, currently at USD14.29 per ounce. The short-swing rebound trend is expected to persist. The frontline is expected to resist the upper 50 day moving average of USD14.42 per ounce. If upturn efforts fail, sideways turbulence will be likely to happen.
II. Commodities Market
Crude oil
Oil futures rose for the second consecutive session on Thursday after this week’s steep losses as U.S. fuel stockpiles declined and a possible cut in OPEC output helped support prices. Brent crude futures rose 50 cents to settle at USD66.62 a barrel. U.S. West Texas Intermediate crude futures rose 21 cents to settle at USD56.46 a barrel. On Tuesday, U.S. futures marked their steepest one-day loss in more than three years due to ongoing worries about weakening global demand and oversupply. While the larger-than-expected crude build was “shocking”, the drops in refined product supplies helped buoy prices
The copper futures and other base metals of London Metal Exchange strengthened on Thursday, backed by the sign of actions by China and the U.S. to resolve trade frictions. China has delivered a written response to U.S. demands for wide-ranging trade reforms, three U.S. government sources said on Wednesday, a move that could trigger negotiations to bring an end to a withering trade war between the world’s top economies. LME copper futures closed at USD6,185 per ton after an increase of 1.6%. The short-swing prices are expected to fluctuate in the range of USD6,000-6,200
CBOT soybean futures went up on Thursday, following a report that rekindled hopes that Sino-US will resume trade negotiation. China is the largest soybean buyer in the world. A source said that, China has delivered a written response to U.S. demands for wide-ranging trade reforms, boosting people’s optimism. In January, CBOT soybean was 5-1/4 cents higher at USD8.88-3/4 per bushel. The intraday quotation hit the highest of USD8.97-1/2 since November 2.

Trading Office of Beijing Branch
Li Nan