Commodities take pause after Brexit

28 June, 2016

So far the Brexit has had a large impact on the global economy, with some calling it a Bear Sterns event not seen since 2008. In this case they might be right, but the decision to leave has been made and the market is starting to take it on board. For many the pound trades may be a little too volatile for most to stomach and that makes sense but precious metals on the other hand are at least obeying technical rules in the wake of this global meltdown for the meanwhile.

Silver for me has been a stand out star in the recent turmoil as investors piled into the precious metal as a knee jerk reaction to the Brexit. The jump upwards pierced through resistance at 17.836 and lead to many predicting higher highs, but in this case resistance held out and silver retreated as the market saw this as a one off event and not prolonged in the long run. This was also heavily assisted though by the heavy buying of the US dollar compared to other currencies, which always has a positive effect for the bears in precious metal markets. For now the ceiling at 17.386 has been holding and many will be getting bearish on this given that even with a Brexit it was unable to hold its ground. Support levels at 17.133 and 16.708 will be in the minds of traders looking for lower lows in the coming weeks.

Gold on the other hand has so far struggled technically to gain any momentum as well after the Brexit and has leapt up the charts but been forced back by resistance at 1323.81. There have been a large number of bets leading up the Brexit in the gold market, and many did very well from them but at the same time these positions will likely unwind in the coming weeks unless we see some further momentum. The next level down of support is at 1295 and it's likely that traders will push down towards this level unless we see talk of the 2nd referendum in the UK quashed by parliament - even though the vast majority of the house believes in a 2nd referendum.

Lastly the NZD has been flying as of late quite high, but the recent Brexit has lead to sharp selling in the  commodity currency as markets had looked for safe haven in the USD. Not even the recent trade balance data which came in at 358M could change peoples' minds, and the selloff has continued at tremendous pace for the NZDUSD.  At present the NZDUSD is edging lower towards support at 0.6961 and I expect that it will push through this and target the 50 day moving average which traditionally acts as dynamic support or resistance, but in this case it's looking likely to be support. 


Source link  
EM Currencies slide as Dollar appreciates

Emerging market currencies have been treated without mercy by a broadly stronger Dollar, yet again. The Dollar Index appreciated to its highest level this year...

Pound crumbles as UK inflation fails to rise

Repeated signs of easing inflationary pressures in the United Kingdom could plant a seed of doubt among investors about whether the Bank...

Global shares come under pressure

Asian equities fell on Tuesday after Oil prices tumbled by more than 4.6% during the previous session, following reports that Saudi Arabia has offered...


USD and Nasdaq continue strong run

US inflation figures were the main focus today for the US economy, as it saw CPI lift in line with expectations to 0.2% m/m. Well this is not a strong hawkish signal...

Trade war escalation triggers risk aversion

A fresh wave of risk aversion swept across financial markets after the United States threatened to impose tariffs on an extra $200 billion worth of Chinese goods...

Investors shrug off trade fears

Trade frictions dominated the headlines last week, but Wall Street investors shrugged off worries of an escalating trade war and instead cheered...


US tariffs on China to steer attention away

Confirmation in the early hours of Friday morning that President Trump will impose tariffs on Chinese imports starting today is likely to take attention away...

OPEC looks to increase supply

Oil markets have been focused on the OPEC meeting happening at present which is likely to wrap up tomorrow and give some serious insight into OPEC...

Market event not to ignore

In a week where market headlines continue to be driven by a potential trade war breaking out between the United States and China along with the latest OPEC meeting...


In the past 24 hours Bitcoin has gained 4.09% and reached $6569.83855266. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has lost -1.3466% and is now at $1.138. Start trading and making money on Forex today.

In the past 7 days Ethereum has lost -7.07% and is now at $315.35783434. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Daily Forex Market Reviews


Forex Currencies Forecasts


Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets89%
2FXTMFXTM87%
3HYCMHYCM85%
4FxProFxPro80%
5FIBO GroupFIBO Group78%
6FXCMFXCM73%
7AvaTradeAvaTrade68%
8HotForexHotForex67%
9Alfa-ForexAlfa-Forex66%
10XMXM66%
  


Share: