I. Precious Metals
Gold
The price of gold rose at $1,255.52 an ounce on Monday, partly lifted by steady flows into exchange-traded funds (ETFs) and a dip in the dollar after touching seven-month highs. Gold tumbled in early October, and basically holds below the 200-day moving average, lingering around $1,250. It fell to $1,247 on building inventories. Federal Reserve Vice Chair Stanley Fischer said the U.S. economy may face longer and deeper recessions in the future if interest rates remain stuck at current low levels, mapping out a world in which low growth hamstrings central banks from effective recession-fighting. The dollar index was kept under pressure, providing a floor to gold prices. We believe that gold would steady at current level in near term.
On chart, gold’s support gradually lowers toward $1,250 as the consolidation continues. If the level is lost, investors’ sentiment will see dramatic changes once again. The next support can be found at around $1,200. In case that the 200-day moving average of $1,266 is breached above, a new round of upturn will be triggered. Gold is expected to move to the 100-day moving average of $1,313.

Silver
Silver was little changed at $17.47 an ounce on Monday with the 200-day moving average keeping providing support. We believe that the white metal would remain rangebound above $17.30. Slight rebound can still be expected. Resistance can be found at around $18.14 in near term.

II. Commodities
Crude Oil
Oil prices settled down on Monday, weighed by oversupply concerns, with a spike in trade volume driving U.S prices below $50, but losses were limited amid a projected drop in American shale output. Trades in U.S. crude futures contracts soared to 12,932 barrels, the highest since Oct. 13, as traders sold off contracts ahead of their Oct. 20 expiry date. Prices rose slightly in the afternoon, as U.S. Energy Information Administration (EIA) showed shale oil production was expected to fall by 30,000 barrels per day (bdp) in November. International benchmark Brent crude fell 43 cents, or 0.8 percent, from the last settlement to close at $51.52 per barrel, after hitting a session low of $51.16 a barrel. U.S. West Texas Intermediate (WTI) closed at $49.94 per barrel, down 41 cents, or 0.8 percent, after hitting a session low of $49.47. Analysts said traders had accumulated a high number of long positions, and were looking to sell ahead of their contracts' expiry date as the U.S. Commodity Futures Trading Commission limits the number they can hold. As a result, oil prices pulled back on Monday. We believe that oil would sustain this trend before the OPEC did cut their output. But oversupply could continue to weigh on oil.

Copper
Copper ended unchanged at $4,675 a tonne, near a one-month low of $4,623.25 hit on Friday. Copper slipped to a one-month low on Friday as the dollar index was firmer after data showed U.S. retail sales rebounded last month as expected, reinforcing expectations of an interest rate increase from the Federal Reserve in December. Europe's biggest smelter cut the premium it will charge customers for copper cathode next year, highlighting over-supply and weak demand. On chart, copper remained weak and is expected to keep downturn with support at $4,600.

Soybean
U.S soybeans rose on Monday, extending its gains to the third consecutive week and hitting the highest since September 22. The soy market got a boost from the U.S. Department of Agriculture’s report on export inspections, traders said. Soyoil also rose, providing a floor to soy futures. The NOPA’s report showed that the soy crushing ran faster than expected in September, further lifting soybean market. At the Chicago Board of Trade, benchmark November soybean futures settled up 15-3/4 cents at $9.78-1/4 per bushel.

Dealing Room, ICBC Beijing Branch
Li Nan

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