I. Precious Metals
Gold

Gold rallied to a one-month high on Wednesday as investor anxiety over the election after the renewal of an FBI probe into Democratic candidate Hillary Clinton's emails knocked the U.S. dollar lower for the second straight day. Gold rose to $1,307 an ounce, its highest since Oct. 4, and was up 0.73 percent at $1,296. Overnight gold weakened after the Fed statement signaling it could hike rates in December as the economy gathers momentum and inflation picks up. Fed’s decision to keep interest rates unchanged refrained from further inflaming electoral anxiety. Expectation on interest rates hike in December boosted investors confidence toward the dollar. The world's largest gold-backed exchange-traded fund, New York's SPDR Gold Shares, reported its first inflow in just over a week on Tuesday.
On chart, gold rallied to $1,307 at one point, breaching the 50-day moving average and approaching the 100-day moving average. But it pared most gains and slipped below the 50-day moving average once again, adding to the pressure at the range between $1,297 to the 100-day moving average at $1,315. Lingering around the 50-day moving average on early Thursday, its gains would be limited due to the long upper shadow line formed yesterday. Bullion’s downturn in the medium term can only realize as the 50-day moving average further moves down and breaches the 200-day moving average. Otherwise, the upturn trend started earlier this year is expected to sustain.

Silver

Silver tracked gold, losing the ground the 50-day moving average under the resistance of the narrow range between the 100-day moving average and 50-day moving average after a successful breakthrough. Silver was up 1.4 percent at $18.58 an ounce, after reaching $18.74, its highest since Oct. 4. Its movement at around the 50-day moving average in early Thursday greatly improved its chance to see a rally. But it is unlikely to rise above yesterday’s peak at $18.73 under the resistance of the upper shadow line formed yesterday. Technically, the pattern of the three moving averages remain intact with the 50-day moving average reversing its downturn. Silver is expected to extend its gains since this year if it could breach the resistance of the 100-day moving average.

II. Commodities
Crude Oil

Oil prices tumbled 3 percent on Wednesday after a record weekly build in U.S. crude inventories stoked investor worries about a global supply glut, days after analysts estimated higher monthly OPEC crude output. The U.S. Energy Information Administration (EIA) said crude inventories rose 14.4 million barrels for the week ended Oct. 28, far more than the 1.0 million barrels analysts had expected. It was the biggest weekly rise in U.S. crude stocks since records began in 1982, and exceeded the American Petroleum Institute's report on Tuesday of a 9.3 million-barrel build. U.S. West Texas Intermediate (WTI) crude settled down by $1.33, or 2.9 percent, at $45.34 a barrel. It broke the $45 support earlier, sinking to a five-week low of $44.96.
Brent fell $1.28, or 2.7 percent, to settle at $46.86, after sliding to $46.46, its lowest since Sept. 28.
OPEC output likely reached a record high of 33.8 million barrels per day (bpd) in October. The group meets Nov. 30, hoping to finalize output cuts. But investors hold a bearish view on the meeting. This week, two OPEC members indicated they were more keen to raise production than cut. Nigeria said its output has recovered to 2.1 million bpd while Libya has doubled its output since mid-September and is producing about 590,000 bpd.

Copper

Copper fell on technical pressure on Wednesday. But its losses were limited, supported by Chinese economic data. Benchmark copper on the London Metal Exchange closed slipped 0.6 percent to $4,891 a tonne. On Tuesday, copper hit a peak of $4,922, its highest since Aug. 2. U.S. presidential election still dominated the market. World markets, including metals, were also spooked by a poll on Tuesday that put U.S. presidential candidate Donald Trump ahead of rival Hillary Clinton. In times of economic or political uncertainty investors often move to safe-haven assets such as gold and the Swiss franc and away from world stocks and some commodities. Helping to bolster copper was China's official Purchasing Managers' Index (PMI) for October, which expanded at the fastest pace in more than two years, adding to the view that a credit and housing boom is stabilising the world's second-largest economy.

Soybean

Chicago Board of Trade soybean futures fell on Wednesday on fears that the US Department of Agriculture might raise its already record-large US soy crop estimate. The benchmark January soybean contract settled down 6-3/4 cents at $9.86-1/2 a bushel. Additional pressure stemmed from declines in crude oil prices, equities and the dollar tied to uncertainty about the outcome of next week's US presidential election. Soy market underpinned by export demand. The USDA said private exporters in the last day sold 132,000 tonnes of US soybeans to China for delivery in the 2016/17 marketing year. CBOT December soyoil closed higher on oil/meal spreading and spillover support from allied Malaysian palm oil futures. CBOT December soymeal closed down $2.8 at $306.7 a tonne. December soyoil settled up 0.13 cents at $34.98 cents. The trading volume of the CBOT soybean, soymeal and soyoil was expected at 140,385 lots, 78,592 lots and 98,275 lots respectively.

Dealing Room, ICBC Beijing Branch
                          Lv Yan

                                  
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