Daily Commodity Outlook, July 1 2020

<p><span>Asian stocks went higher on Wednesday in a new quarter, as investors assessed mixed data on the global economy amid concern over the coronavirus spread and Sino-American tensions. U.S. consumer confidence posting its biggest increase since 2011 while China’s manufacturing activity beat expectations in June according to a private survey. The upbeat data prints are bringing back risk-on sentiment.</span></p>
<p><span>Dollar bounced, benefiting from strong consumer confidence in June. The Conference Board’s consumer confidence index rose to 98.1 for the month. Economists polled by Dow Jones expected consumer confidence to rise to 91 from a May reading of 85.9. States across the country have ramped up efforts to reopen the U.S. economy by easing some measures aimed at curbing the </span><a href="https://www.cnbc.com/coronavirus/"><span>coronavirus</span></a><span> pandemic.Though it is still below the pre-pandemic level, we have been seeing continuously strong data which boosted market sentiment to a large extent.</span></p>
<p><span>In June, copper prices recorded a 11% gain and this rally can be attributed to a strong demand for the metal in China as they recover from the pandemic, coupled with growing concerns of a supply disruption in Chile, one of the world ’s largest producers of the metal. However, the rally in copper might not be sustainable in the long run as demand outside of China remains weak as the world battles with a spike in the number of Covid-19 cases. In line with the fundamentals, prices are seeing room for further upside before reaching our resistance where we could see a reversal below this level. </span></p>
<p><span>Gold reached nearly its 8 year high today as growing concerns of a resurgence of new Covid-19 cases buoyed demand for the safe-haven metal. Looking ahead, we could be seeing further upside in the precious metal as it benefits from the risk aversion and is often viewed as a hedge against currency debasement and inflation. </span></p>
<p><span>Oil edged slightly higher over night following a report that there was a drop in the US crude oil stockpile. This was the first report of a drop in inventory since May 2020. However at the start of the Asian trading session, oil traded sideways and further upwards momentum was muted. This is probably due to market observers noting that the US is going in a completely wrong direction when dealing with the 2nd wave of virus outbreak. The CAD, in line with the overnight rise in oil price, strongly outperformed the USD.</span></p>
<p><b>Technical &amp; Trade views</b></p>
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<p><b>USDCAD (</b><b>Intraday bias: bullish above 1.3554)<br />
<img class="aligncenter size-large wp-image-46293" src="http://blog.tickmill.com/wp-content/uploads/2020/07/usdcad-1024×534.png" alt="" width="1024" height="534" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/usdcad-1024×534.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/usdcad-300×156.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/usdcad-768×400.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/usdcad.png 1113w" sizes="(max-width: 1024px) 100vw, 1024px" /><br />
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<p><span>We turned bullish as price is approaching 1st support where the horizontal overlap support is. Price is likely to bounce off the level towards 1st resistance where the horizontal overlap is.</span></p>
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<p><b>UKOIL (</b><b>Intraday bias: Bearish below 41.76)<img class="aligncenter size-large wp-image-46294" src="http://blog.tickmill.com/wp-content/uploads/2020/07/ukoil-1024×530.png" alt="" width="1024" height="530" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/ukoil-1024×530.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/ukoil-300×155.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/ukoil-768×397.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/ukoil.png 1111w" sizes="(max-width: 1024px) 100vw, 1024px" /><br />
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<p><span>Oil drifted sideways and still holding below 1st resistance at 41.76. A short term drop below 1st resistance at 41.76 towards 1st support at 40.54 is expected. Stochastics is also coming to test resistance where price reacted in the past.</span></p>
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<p><b>XAUUSD ( </b><b>Intraday bias: Bullish above 1777.26) <img class="aligncenter size-large wp-image-46295" src="http://blog.tickmill.com/wp-content/uploads/2020/07/xauusd-1024×484.png" alt="" width="1024" height="484" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/xauusd-1024×484.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/xauusd-300×142.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/xauusd-768×363.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/xauusd.png 1114w" sizes="(max-width: 1024px) 100vw, 1024px" /><br />
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<p><span>Price is testing our first support in line with our 23.6% retracement and horizontal pullback support, where we could see a bounce above this level to our first resistance level. Ichimoku cloud and RSI are showing signs of bullish pressure in line with our bullish bias. </span></p>
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<p><b>XCUUSD ( </b><b>Intraday bias: bearish below 2.76608)<img class="aligncenter size-large wp-image-46296" src="http://blog.tickmill.com/wp-content/uploads/2020/07/xcuusd-1024×488.png" alt="" width="1024" height="488" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/xcuusd-1024×488.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/xcuusd-300×143.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/xcuusd-768×366.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/xcuusd.png 1114w" sizes="(max-width: 1024px) 100vw, 1024px" /><br />
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<p><span>Price is facing bearish pressure from our first resistance where we remain bearish below this level and could see a further drop to our first support level, in line with our horizontal pullback support, 38.2% fibonacci retracement and 61.8% fibonacci extension. Stochastic is facing bearish pressure from our resistance as well. </span></p>
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<p>The post <a rel="nofollow" href="https://blog.tickmill.com/tech-analysis/daily-commodity-outlook-july-1-2020/">Daily Commodity Outlook, July 1 2020</a> appeared first on <a rel="nofollow" href="https://blog.tickmill.com">Tickmill</a>.</p>