BULLION – Gold (Oct) can test 35020 while taking resistance near 35510 and silver (Sep) can dip lower towards 40500 and resistance near 41300. The price of gold shot up from about 34040 to around 35630 as investor flocked into gold as yields plummeted following the increase in tariffs between the US and China. Trump said he would impose an additional 10% tariff on $300 billion worth of Chinese imports on Sept. 1 after U.S. negotiators returned from trade talks in Shanghai, saying China had failed to buy large quantities of U.S. agricultural products as promised. Trump also said if trade negotiations fail to progress he could raise tariffs further even beyond the 25% levy he has already imposed on $250 billion of imports from China. The tariffs may also force the Federal Reserve to again cut interest rates to protect the U.S. economy from trade-policy risk. The October Fed funds rate futures FFV9 have jumped to now fully price in a rate cut in September, compared with only around 60% before the tariff announcement. Another 25 basis point move is priced in by December.
ENERGY- Crude oil may move towards 3650 while taking resistance near 3820. steadying after an overnight plunge following U.S. President Donald Trump’s move to impose more tariffs on Chinese imports, intensifying a trade war that has hit global growth. Brent crude slumped more than 7% on Thursday, its steepest drop in more than three years. U.S. crude fell nearly 8%, posting its worst day in more than four years, The collapse ended a fragile rally built on steady drawdown’s in U.S. inventories, even as global demand looked shaky due to the trade dispute between the world’s two biggest economies. Total U.S. oil demand in May fell 98,000 bpd to 20.26 million bpd, data showed earlier this week. OPEC and partners including Russia, an alliance known as OPEC+, have been curbing output this year to support the market. In July, OPEC production revisited a 2011 low, helped by a further cut by Saudi Arabia. Natural gas can recover towards 158 while taking support near 149. Despite the rally on Wednesday, the hotter trends in the overnight data are still not hot enough to impress and suggests there is still a bearish bias in the market. The rally we say yesterday was probably driven by short-covering due to the slight change in the weather pattern and grossly oversold technical indicators.
BASE METAL – Copper may test 436 while taking resistance near 445. Copper hitting its lowest in over three weeks after U.S. President Donald Trump said he would slap a 10% tariff on the remaining $300 billion of Chinese imports from next month. The reactivation of a smelter belonging to Chile’s staterun Codelco, the world’s top copper producer, will be further delayed until the end of October this year after missing a previous target of April. Copper contract on the Shanghai Futures Exchange dipped 0.6%, aluminium eased 0.2%. Three-month LME copper touched its lowest since July 10 at $5,876 a tonne before paring losses to $5,899, a decline of 0.5%.Zinc and lead dropped 0.8% each. However, nickel rose 1.2% and tin was almost unchanged. Zinc can test 187 while taking resistance near 192. Lead may test 149 while taking resistance near 154. Nickel may rise towards 1040 while taking support near 990. company PT Aneka Tam bang’s nickel ore output in Jan-Jun rose 27% on year to 4.79 mln tn. Aluminum may test 135 while taking resistance near 140.
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