WTI recovers to six-month high
WTI Crude prices settled above US$86 per barrel on Friday, making a six-month high since the rise of tensions between Iran and Israel. Iran vowed retaliation after its consulate in Damascus has been struck by missile attack.
US manufacturing PMI rose to 50.3 in April and emerged above 50 for the first time since December 2022. Service PMI reached 51.4 in March but was below expectations.
US non-farm payroll saw a rise of 303,000 jobs in March, higher than consensus and surpassing the revised 270,000 jobs in the previous month. Unemployment rate declined to 3.8 per cent compared with 3.9 per cent in February.
German preliminary consumer prices gained 0.4 per cent in April. The eurozone inflation in March was down to 2.4 per cent gains from a year ago. Core inflation grew 2.9 per cent on an annualised rate. Both reports sank below consensus’ expectations.
Spot gold prices continued to soar into an all-time high. The gold market reached an alltime high, closing at US$2,329 per ounce. Surprisingly, the US dollar index (USDX) remained strong above 104 and has yet to make a correction.
Technical forecast
US dollar/Japanese yen traded in a very narrow range, amid low liquidity. The market lost its rising momentum while waiting for the Bank of Japan to curb the weak yen. We forecast the market might thread inside 151 to 152 and stayed in low interest. The trend will only turn vibrant after the movement exits the aforementioned range.
Euro/US dollar bounced off 1.0724 last week and settled at 1.0835. We reckoned the market might be supported at 1.08 and begin to consolidate higher. The topside target is at 1.0950 if the trend gained its momentum. Traders expect the dollar to weaken gradually.
British pound/US dollar has converged in the 1.26 region. We expect the market to stay in a tight range from 1.2530 to 1.2680. However, the trend might break into a new direction once it exits this aforementioned range. Traders are advised to stay alert for price changes.
Gold prices continued into new uncharted territory last week. We foresee the market might close higher on a weekly basis. The range is expected to move from US$2,280 to US$2,380 per ounce with increasing buying interest. Bargainhunters might be keen to pick bottom whenever there is a quick pull-down retracement.
WTI Crude prices rose above US$84 per barrel last week and emerged into a new bullish trend. The market might be supported at US$86 per barrel and might potentially ascend further. We aim the topside target at US$92 per barrel before profit-taking emerges. However, beware of driving beneath the US$86 per barrel support that might quickly reverse the growing trend.
Silver prices shot up following the bullish trend in the gold market. We forecast the support might rise at US$26.50 per ounce and the topside target resistance is identified at US$28 per ounce. On the hind sight, we reckoned a breakthrough above US$28 per ounce will potentially drive up to US$30 per ounce.
Crude Palm Oil (FCPO) Futures on Bursa Derivatives gained last week but stayed close above RM4,400 per metric tonne. Soy oil remained sideways and could be affecting the rising sentiment of FCPO. June 2024 Futures settled at RM4,345 per metric tonne on Friday. We predict the market might trade initially within RM4,300 to RM4,400 per metric tonne. Piercing above the aforementioned range might lead to RM4,700 per metric tonne in the near future.