MCX COMMODITY MARKET MORNING UPDATES - 17 OCT 2017

GOLD - Gold markets have shown a bit of strength during the Monday session, as we continue to hang above the $1300 level. That is a very bullish sign, and as you can see we can already look at the 24-hour exponential moving average as dynamic support as well. It is just below the $1300 level, so I think that pullbacks towards that area will continue to attract interest. I think that the gold markets breaking above the $1300 level is a very bullish sign, and that it should continue to send money into this market place going forward. I think that the $1325 level above is the next target, and I believe that it’s a matter of time before the buyers return on these pullbacks as they represent value.

CRUDE OIL - December West Texas Intermediate crude oil futures rallied on Monday to its highest level since September 29, putting it in a position to challenge the last main top at $53.11. The catalyst behind the rally was a new Iraq conflict that threatens output. Iraqi forces moved on Sunday and Monday to take controls of oil fields in the Kurdish-held city of Kirkuk and the surrounding areas. This conflict is different from the other military activity in the Middle East because it involves oil and oilfield infrastructure.

NATURAL GAS - The natural gas markets gapped lower at the open on Monday, reaching towards the $2.96 level initially, rallying slightly, and then broke down even further. It looks as if we are trying to find some type of support near the $2.92 level, but I think at best we are going to see a bounce that we can start selling again. I still have a target of $2.85 underneath, and I still believe that there is a massive amount of resistance at the $3.00 level above. That resistance should continue to show selling pressure due to the fact that US fracking companies become profitable above that level, and therefore the massive oversupply of natural gas starts getting offered again every time we get close to that level.

COPPER - December Comex High Grade Copper futures soared to their highest level on more than three-years on renewed optimism over China’s economic outlook. Prices in New York started higher early in the session after copper on the London Metal Exchange jumped 2.9 percent, touching an August 2014 high. The rally was primarily supported by upbeat economic data from China. It’s producer price inflation unexpectedly accelerated to a six-month high in September as a construction boom showed no signs of abating and a government crackdown on air pollution triggered fears of winter shortages. In other news, China’s unwrought copper imports surged by 26.5 percent in September from a year ago, customs data showed on Friday, but remained on course for an annual drop in 2007. China’s economy is expected to grow by 7 percent in the second half of this year, the country’s central bank governor said, defying economists’ expectations for a slowdown.Finally, hedge funds and money managers raised their net long positions in copper futures and options for the first time in five weeks, in the week to October 10, according to the U.S. Commodity Futures Trading Commission.

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