Daily Commodity Outlook, May 29 2020 

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<p><span>Asian stocks dropped on Friday with European and U.S. equity futures as investors took a cautious stance before President Donald Trump’s anticipated address later Friday that could further escalate the U.S.-China tensions. The Hang Seng opened about 1.5% lower, while Japanese shares dipped more modestly along with those in Seoul and Shanghai. U.S. contracts slid after the gauge gave up a gain of more than 1% Thursday, with the U.S.-Beijing tension brewing on the backdrop. </span></p>
<p><span>USD weakened further against major currencies as progress in lifting coronavirus lockdowns and stimulus plans in Europe weakened demand for safe havens, but the mood could quickly worsen if Sino-U.S. tensions increase. Traders are focusing on the U.S. President Donald Trump’s response to China’s passage of a national security law for Hong Kong, which could escalate the tensions in any minute. </span></p>
<p><span>Copper prices edged higher on hopes of increasing demand for the red metal as more countries around the world eased lockdown measures and reopened their economies. Copper prices are used as a gauge of the global economic health, and it is likely that the growing optimism of the economic recovery from the COVID-19 pandemic overshadowed the immediate concerns about a standoff between the United States and China over Hong Kong.</span></p>
<p><span>Gold climbed higher as tensions between US and China escalate. While the stock market remains strongly supported, it would not be at the expense of the safe-haven selling. Elsewhere, the risks of deflation and lack of physical demand have put a mild damper with the short-term outlook for gold, but the longer-term bullish fundamentals still firmly remain intact. Looking ahead, gold should continue to benefit from increased central bank demand, robust physical demand when China and India see improving economic data, and fresh injections of stimulus from central banks globally.</span></p>
<p><span>Oil prices drifted lower again as negative sentiments coming out of the deteriorating US-China relations casts doubt on any further market recovery. The drop however was not as dramatic as the one seen earlier at the start of this month as investors are generally watching for new developments when the OPEC+ coalition meets in early June. Further, there remains going concerns regarding a probably second wave of virus infections in regions across the world that could very well throw markets back into chaos again. In line with oil prices drifting lower, CAD weakened as well. However its drop against the USD was muted as better than expected data caused traders to ditch the USD and pump capital back into the stock markets.</span></p>
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<p><b>Technical &amp; Trade views</b></p>
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<p><b>USDCAD (</b><b>Intraday bias: bullish above 1.3735)</b></p>
<p><img class="aligncenter size-large wp-image-44392" src="http://blog.tickmill.com/wp-content/uploads/2020/05/usdcad-13-1024×519.png" alt="" width="1024" height="519" srcset="https://blog.tickmill.com/wp-content/uploads/2020/05/usdcad-13-1024×519.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/05/usdcad-13-300×152.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/05/usdcad-13-768×389.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/05/usdcad-13.png 1109w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>We turned bullish as price is approaching our 1st support  where the 127% fibonacci  extension and horizontal swing low support are.Price is likely to bounce here towards our 1st resistance where the 38.2% fibonacci retracement is. MACD also shows support here.</span></p>
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<p><b>UKOIL (</b><b>Intraday bias:Bearish below 35.94)</b></p>
<p><img class="aligncenter size-large wp-image-44393" src="http://blog.tickmill.com/wp-content/uploads/2020/05/ukoil-13-1024×484.png" alt="" width="1024" height="484" srcset="https://blog.tickmill.com/wp-content/uploads/2020/05/ukoil-13-1024×484.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/05/ukoil-13-300×142.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/05/ukoil-13-768×363.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/05/ukoil-13.png 1112w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>Oil holding below  a short term descending trendline resistance. A short term drop below 1st resistance at 35.94 towards 1st support at 32.03 can be expected. RSI indicator also holding below it’s descending trendline resistance where price has reacted in the past before.</span></p>
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<p><b>XAUUSD ( </b><b>Intraday bias: bullish above 1723.889) </b></p>
<p><img class="aligncenter size-large wp-image-44394" src="http://blog.tickmill.com/wp-content/uploads/2020/05/xauusd-13-1024×487.png" alt="" width="1024" height="487" srcset="https://blog.tickmill.com/wp-content/uploads/2020/05/xauusd-13-1024×487.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/05/xauusd-13-300×143.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/05/xauusd-13-768×365.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/05/xauusd-13.png 1113w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>We caught the bounce nicely previously. Price is currently testing our intermediate resistance level where a break above this level would provide the bullish acceleration to our first resistance target. RSI is showing signs of bullish pressure as well. </span></p>
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<p><b>XCUUSD ( </b><b>Intraday bias: bullish above 2.36914)</b></p>
<p><img class="aligncenter size-large wp-image-44395" src="http://blog.tickmill.com/wp-content/uploads/2020/05/xcuusd-14-1024×530.png" alt="" width="1024" height="530" srcset="https://blog.tickmill.com/wp-content/uploads/2020/05/xcuusd-14-1024×530.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/05/xcuusd-14-300×155.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/05/xcuusd-14-768×397.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/05/xcuusd-14.png 1108w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>We caught the bounce nicely from our first support level and remained bullish above our support at 2.36914, in line with our horizontal overlap support, 61.8% fibonacci retracement and 78.6% fibonacci extension, where we could see a bounce to our first resistance level. Stochastic and Ichimoku cloud are showing signs of bullish pressure in line with our bullish bias.</span></p>
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