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  5. Commodity trade setup for November 21: Gold rises for the fourth straight day reclaims ₹76,500 level

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Commodity trade setup for November 21: Gold rises for the fourth straight day reclaims ₹76,500 level

Upstox
By Upstox News Desk

4 min read | Updated on November 21, 2024, 18:18 IST

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SUMMARY

The December crude oil futures contract formed a bullish engulfing pattern on November 18, signaling a potential bullish reversal. A close above the high of this pattern would confirm further strength in the uptrend. However, if the price fails to close above the November 18 high, the pattern will be invalidated.

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Commodities trade setup 21 Nov: Gold reclaims ₹76,000, Crude oil rebounds forming a bullish pattern

Market recap (as of 6:00 pm)

  • Gold 5 Dec Futures: ₹76,557/ 10 gram (▲ 0.6%)
  • Silver 5 Dec Futures: ₹90,316/ 1 kg (▲ 0.2%)
  • Crude Oil 18 Dec Futures: ₹5,951/ 100 BBL (▲ 2.1%)
Gold: The yellow metal is trading in the green for the fourth consecutive session, with spot gold trading 0.72% higher at $2,669 an ounce. Rising tensions between Russia and Ukraine have led to an increase in demand, helping bullion to overcome the strength of the U.S. dollar.
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Silver: Silver prices are also trading higher, up 0.56% at $31.01 an ounce in the spot market. The precious metal extended its gains, bouncing off more than two-month lows amid rising geopolitical tensions.
Crude Oil: Oil prices are trading higher on Thursday. Brent futures are trading around $73.87, while WTI crude is trading around $70.00. Oil prices are rising as geopolitical concerns over escalating tensions between Russia and Ukraine outweighed the impact of a larger-than-expected increase in U.S. crude inventories, which rose by 545,000 barrels to 430.3 million barrels in the week ended 15th November.

Technical structure

Gold: The Gold Futures on MCX is up 0.7% as of 5 pm, extending the gains for the fourth consecutive day. It reclaimed the 50 day exponential moving average (EMA) on 20 November and is currently trading above 21 EMA, indicating strength. Traders can monitor the price action around 21 EMA as a close above this can push the prices higher upto 78,500 zone, the next immediate resistance. Meanwhile, the support is visible around 50 EMA.
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Silver: The price action of silver as per the daily chart looks range-bound between 21 and 200 EMA. As shown in the chart below, the silver protected the immediate swing low (88,222) and 200 EMA on closing basis and sustained the higher-high and higher-low structure on the daily chart. For the upcoming sessions, traders can monitor the 21 EMA and the immediate swing low of 88,222. A close above these levels with a strong candle both on positional and intraday basis will provide further directional clues.
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Crude oil: The oil prices staged a rebound from the crucial support zone of 5,600 and the Futures contract of 18 December on MCX is trading above 21 EMA as of 5 pm. It formed a bullish engulfing candle on the daily chart on 18 November at the crucial support zone, awaiting confirmation. Currently, the crude is trading above the high of the bullish reversal pattern and if it closes above the high of the 18 November, then the pattern will get confirmed. However, the broader structure of the crude still remains range-bound between 6,100 and 5,600. Unless this range is breached on a closing basis, the trend may remain sideways.
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The open interest build-up for the 16 December expiry has the highest call build-up at 6,000 strike, indicating that crude prices may face resistance around this zone. On the other hand, the put base was seen at 5,800 strike, suggesting support around this zone. Additionally, significant call and put base was also seen at 5,900 strike, pointing to the range-bound activity around this level.

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Disclaimer:

Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop-losses. The information is only for the client's consumption, and such material should not be redistributed. We do not recommend any particular stock, securities, or strategies for trading. The securities quoted are exemplary and are not recommendatory. The stock names mentioned in this article are purely to show how to do analysis. Take your own decision before investing.

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About The Author

Upstox
Upstox News Desk is a team of journalists who passionately cover stock markets, economy, commodities, latest business trends, and personal finance.

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