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  5. Commodity trade setup for November 4: Oil prices extend gains, gold and silver slip ahead of U.S. election and Fed meet

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Commodity trade setup for November 4: Oil prices extend gains, gold and silver slip ahead of U.S. election and Fed meet

Upstox
By Upstox News Desk

3 min read | Updated on November 04, 2024, 19:26 IST

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SUMMARY

Gold has formed a bearish reversal candle on the weekly chart, resembling a shooting star. After a sharp rise of nearly 18% in the last three months, the yellow metal indicates a pause ahead of the U.S. election results. However, the pattern will only be confirmed if the next candle closes lower than the reversal pattern.

Oil prices extend gains, Gold and silver slip ahead of U.S. election and Fed meet

Oil prices extend gains, Gold and silver slip ahead of U.S. election and Fed meet

Market recap (As of 6:45 pm)

  • Gold 5 Dec Futures: ₹78,501/ 10 gram (▼0.4%)
  • Silver 5 Dec Futures: ₹94,567/ 1 kg (▼0.9%)
  • Crude Oil 19 Nov Futures: ₹6,021/ 100 BBL (▲0.5%) (As of 6:45 pm)
Gold: Gold is trading in the green, with spot gold up 0.12% at $2,753 an ounce. The yellow metal continues to trade near record highs ahead of the U.S. election results and the upcoming U.S. Federal Reserve meeting. Gold prices were also supported by recent decline in the dollar. The greenback tumbled from its three-month high following last weak non-farm payrolls data, which bolstered the case for further interest rate cuts by the U.S. Fed.
Silver: Silver prices are also trading higher, up 0.60% at $32.87 an ounce in the spot market. Demand for precious metals remains high ahead of key events in the United States, including the Federal Reserve's interest rate decision on 7th November.
Crude Oil: Crude oil prices are trading higher on Monday, with Brent futures trading at $74.7 per barrel and WTI crude at $71.17, up almost 2.5% on the day. Oil prices rose sharply on Monday after the Organisation of the Petroleum Exporting Countries (OPEC) and its allies said its members would delay a planned production increase in December by at least a month, citing recent pressure on oil prices due to weak demand.

Technical structure

Gold: Gold prices of the MCX's 5 December futures contract are trading in range and are down 0.5% to ₹78,405. The yellow metal is currently consolidating around its VWAP on the hourly chart and is trading near immediate support. If it closes below the 78,200 mark with a strong candle on the 15-minute time frame, then it can retest the ₹77,800 zone. On the flip side, a close above the VWAP and ₹79,500 mark can result in further upmove.
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Silver: Silver prices also consolidate in a tight range after falling below the key support zone of ₹96,300. The December 5 futures contract is oscillating around its VWAP on the hourly time frame. If it slips below ₹94,450 with a strong candle on the 15-minute time frame, it can test the 93,200 level. On the other hand, the bullish sentiment will only emerge if it captures the 98,200 level on the closing basis on the hourly chart.
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Crude oil: Crude oil futures on the MCX are trading in the green this morning, up nearly 1%. The 15 November price holds above the VWAP and has breached the key resistance level of ₹6,000. A close above this level on the hourly chart could see a retest of the ₹6,100 level.
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The open interest data for the 15 November expiry saw significant put build-up at 5,800 and 5,700 strikes, indicating support for crude oil futures in this zone. On the other hand, the call base was seen at 6,000 and 6,100 strikes, pointing at resistance around these levels.

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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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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