Talking Points

  • Crude Oil, Copper May Rise as S&P 500 Futures Point to Risk-On Mood
  • Gold and Silver Could Find Support in Ebbing Haven Demand for US Dollar

Commodity prices are treading water as financial markets look for direction amid a lull in top-tier scheduled event risk. S&P 500 stock index futures are pointing cautiously higher, hinting the growth-linked crude oil and copper price may have scope to advance. A risk-on scenario may likewise offer a boost to gold and silver as ebbing haven demand weighs on the US Dollar. July's Chicago National Activity Index is the only item on the US data docket.

WTI Crude Oil (NY Close): $96.01 // +0.41 // +0.43%

Prices broke resistance at 95.41, the February 2 low, opening the door for a challenge of the 61.8% Fibonacci retracement at 97.82. A break above that exposes the psychologically significant $100/barrel figure. The 95.41 level has been recast as support, with a drop back below that targeting the 50% Fib at 93.90.

"Commodities_Tread_Water_as_Risk_Trends_Look_for_Direction_body_Picture_3.png,

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1616.05 // +0.95 // +0.06%

Prices continue to drift below resistance in the 1620.45-35.70 congestion area. Near-term support remains at a rising trend line support set from late June, now at 1599.67. A break below this boundary exposes a longer-term trend line established from the May 16 bottom, currently at 1578.22. Alternatively, a push above resistance initially targets the major trend set from the April 23 2011 peak, now at 1666.52.

"Commodities_Tread_Water_as_Risk_Trends_Look_for_Direction_body_Picture_4.png,

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $28.09 // -0.13 // -0.46%

Prices continue to stall above support at 27.68. A break downward initially exposes a rising trend line set from the June 28 low, now at 27.37. Near-term resistance remains at 28.44, with a breach above that opening the door for an advance to challenge 29.42.

"Commodities_Tread_Water_as_Risk_Trends_Look_for_Direction_body_Picture_5.png,

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.420 // +0.038 // +1.12%

Prices are pulling back from resistance at a falling trend line set from the April 3 high, a barrier reinforced by a horizontal level at 3.435. Near-term support lines up at 3.387, with a break lower exposing the 3.300-32 area. Alternatively, a break above 3.435 targets 3.535.

"Commodities_Tread_Water_as_Risk_Trends_Look_for_Direction_body_Picture_6.png,

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak