US equity markets closed almost flat on Monday evening, with light trading activities across the desk. As S&P 500 daily trading volume shrank below its 30-day average volume since mid-June, markets have entered into a contractive consolidation phase.

Now investors are waiting for Ms Janet Yellen’s congressional testimony on Wed, 13th July to paint a clearer picture of the market outlook. Key focus includes her assessment of the US economy, and how this might affect Federal’s future monetary policy – in particular the timing of the central bank’s plans to cut the balance sheet. According to the recent Fed meeting minutes and statements, we have reasons to believe that Federal officials have placed the job market status on top of inflation numbers.

Precious metal prices tested lower lows, with gold and silver breaking down below their key support levels – US$1,219 and US$16.13 respectively. Gold price has dropped to US$1,212 this morning, and its next support levels could be found at psychological level of US$1,200 and US$1,196 respectively.

WTI Crude oil price holds above US$44.50 as Libya and Nigeria were invited to join OPEC’s meeting with other major producers later this month, in which the two countries will potentially be required to join the production freeze coalition. Traders are accessing the likelihood of positive outcome of this meeting and the potential impact that the deal could bring to global production-supply balance.

Technical analysis

Gold- Cash:

  • 10-day Simple Moving Average sloped downwards
  • SuperTrend (10,2) has flipped into bearish set-up
  • Momentum indicator RSI has entered into oversold territory of 27%, indicating oversold
  • ‘Double bottom’ pattern failed to form as price broke down $1,219s
  • Immediate support levels at 1,200 and 1,196

Crude Oil West Texas - Cash:

  • SuperTrend (10,2) has flipped into bearish set-up
  • 10-Day Simple moving average slopped upwards
  • Price has retraced 61.8% from the rally starting from 22nd June
  • Immediate support level could be found at $43.90
  • Immediate resistance levels can be found at $45.15, $46.00 and $47.15s

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