Oil surged on colder weather forecast and China's stimulus

·         USD slumped on hopes of a less hawkish Trump trade war policy; Gold and Wall Street Futures surged; but later Trump denied any such plan; Gold slip

·         Also Gold and oil stumbled on the progress of an imminent Gaza war ceasefire & hostage deal; stocks also got some boost

Oil surged almost 7% in the last two weeks, scaling a 2-month high around 74.35 on an unusually colder weather forecast in the Northern Hemisphere led by the U.S. and Europe. Oil was also boosted by optimism about Chinese economic stimulus. China’s PBOC may soon unveil an accommodative monetary policy, while the Chinese government is providing targeted fiscal stimulus to boost domestic consumption. This latest rally pushed oil prices to a two-month high and contributed to a weekly gain of nearly 5%.

There are concerns about China’s economic fragility and heightened expectations for new policy actions to boost domestic consumption in the world’s largest oil importer and 2nd largest oil consumer. Although, due to the rapid adoption of EVs, and increasing usage of HSR (High-Speed Railway) across China, domestic consumption of traditional fossil fuel may be decreasing, Chinese refineries are also exporting transportation fuel (Petrol/Diesel/Gasoline) to EU/Europe after importing cheap & ‘sanctioned’ Russian crude oil (at a heavy discount). Thus overall oil demand from China is also growing at a steady pace in China despite the rapid adoption of the green economy.

These hopes offset last year’s bearish demand assumptions tied to weaker Chinese consumption. On the other side of the Pacific, in the US, the largest consumer of oil, crude stockpiles unexpectedly fell by 1.2MB to 415.6MB, adding price support, while gasoline and distillate inventories climbed as refineries increased production despite a two-year low in fuel demand. Colder weather forecasts in the US and Europe as well as the Northern Hemisphere are also helping to boost heating oil/gas demand, providing further support to crude oil and NG (Natural Gas) prices.

Last week, China announced some targeted fiscal stimuli like raising government workers' wages and increasing ultra-long treasury bond funding to spur local/state/Federal consumption (CAPEX & spending) and also private consumption )consumer spending and CAPEX); i.e. China will issue more ultra-long bonds (debts) to fund deficit spending to enhance productive capacity and boost economic growths. In recent months, China has implemented several stimulus measures to bolster its economy.

China Increased Funding through Special Treasury Bonds: In early January 2025, China announced plans to substantially raise funding via ultra-long special treasury bonds to stimulate economic growth. The funds are designated for initiatives such as consumer subsidies for trading in old cars and appliances, business subsidies for upgrading large-scale equipment, and household subsidies for purchasing digital products like cell phones and tablets.

September 2024 Stimulus Package: In September 2024, China announced a comprehensive economic stimulus package to counteract the economic slowdown.

Monetary Policy Overhaul by PBOC: The PBOC has indicated plans to cut interest rates and transition to a more orthodox monetary policy framework; i.e. easing like the Fed and the ECB. This shift involves prioritizing interest rate adjustments over quantitative loan growth targets, aiming to enhance the effectiveness of monetary policy and support economic recovery.

PBOC Interest Rate Cuts and Policy Shifts: The PBOC is anticipated to reduce interest rates further in 2025 as part of broader policy changes to create a more market-driven interest rate curve. This move is intended to align with high-quality development goals and stimulate lending and investment amid economic challenges like a slump in the domestic real estate market. China’s 1Y Prime Lending Rate (PLR) was around +5.85% in 2014, reduced progress to +3.85% by 2020 in response to various economic challenges including the Trump trade war 1.0. Now PBOC further cut the 1YPLR to 3.10% by 2024 in response to subdued economic activities amid tepid external trade (exports) and also subdued domestic consumption. PBOC may cut more appropriately to fight against a potential Trump trade war 2.0.

Interest Rate Cuts: China’s Central Bank PBOC reduced policy interest rates and the cash reserve requirement ratio (CRRR) by 0.50% to enhance funding liquidity in the financial system with lower borrowing costs.

Support for Real Estate: Measures include lowering mortgage rates (5YLPR) by approximately 0.5 percentage points and reducing down payment ratios for second homes to stimulate the property market, which has been in decline since 2021. After a series of cuts, China’s 5YLPR  for mortgage loans now stands at 3.60% from 4.85% in Sep’19 (pre-COVID).

Salary Increases for Chinese Government Workers: For the first time in a decade, China has raised wages for millions of government employees to boost consumer spending and support the slowing economy. The pay hike, retroactive to July, provides an average monthly increase of about 500 yuan ($68.50) and is expected to inject between $12 billion to $20 billion into the economy. China’s average inflation (total CPI) has been around +0.7% for the last three years (since 2021); i.e. increased by around +2.0%, while overall average labor costs decreased -2.0% in the same period; i.e. average -0.7% per year. China’s monthly average wage was around CNY 10200; i.e. around $1400/M before the latest increase and now would be around CNY 10700; i.e. ~$1475/M. China’s youth unemployment rate is also on the higher side around 20%, which is causing some types of social disharmony.

China’s Emphasis on Economic Growth and Reforms: In his New Year's address, China’s President Xi Jinping acknowledged the economic and social challenges facing China, emphasizing the importance of employment, inclusive income growth, and comprehensive reforms to address issues such as youth unemployment and slow wage growth. This underscores the government's commitment to implementing policies that promote economic stability and growth.

Liquidity Support Programs: New financial tools were introduced to support securities markets and facilitate loans for stock buybacks by companies.

Focus on Domestic Demand: Fiscal expansion/stimulus and Monetary stimulus.

During the Central Economic Work Conference held in December 2024, Chinese leaders emphasized the need for a "more proactive" fiscal policy and a "moderately loose" monetary policy for 2025. This includes:

·         Increasing government borrowing and expanding the fiscal deficit rate to stimulate consumption and investment.

·         Plans for a record budget deficit of 4% of nominal GDP in 2025, up from 3%

Long-term Economic Strategy:

·         Despite these short-term measures, some experts caution that significant structural challenges remain. The economy is expected to grow around 4.5% in 2025, but achieving sustained growth will require deeper reforms to transition towards a consumption-driven economy. The Chinese government aims to address weak consumer confidence and promote household spending as part of its long-term strategy.

In summary, in recent months, China has implemented a series of economic stimulus measures aimed at revitalizing its economy, which has been grappling with slow growth and a struggling property market. China's recent stimulus efforts are focused on mitigating economic stagnation through both monetary and targeted fiscal stimulus for key sectors like real estate and consumer spending. While these measures may provide a temporary boost, the effectiveness of these strategies in addressing long-term economic challenges remains uncertain. These measures reflect China's multifaceted approach to stimulating its economy, focusing on fiscal policy, monetary reforms, and direct support to consumers and businesses.

On 12th December’24, the IEA wrote in its December MOR (Monthly Oil Report):

Highlights

World oil demand growth is set to accelerate from 840 kb/d in 2024 to 1.1 mb/d next year, lifting consumption to 103.9 mb/d in 2025. Increases in both years will be dominated by petrochemical feedstocks, while demand for transport fuels will continue to be constrained by behavioral and technological progress. While non-OECD demand growth, notably in China, has slowed markedly, emerging Asia will continue to lead gains in 2024 and 2025.

Global oil supply rose by 130 kb/d m-o-m to 103.4 mb/d in November, up 230 kb/d y-o-y, on a continued recovery in Libyan and Kazakhstan output. Total oil supply is on track to increase by 630 kb/d this year and 1.9 mb/d in 2025, to 104.8 mb/d, even in the absence of unwinding of OPEC+ cuts. Non-OPEC+ supply rose by about 1.5 mb/d in both years, led by the United States, Brazil, Guyana, Canada, and Argentina.

Refinery throughputs will reach an annual peak of 84.3 mb/d in December; nearly 3 mb/d more than in October when maintenance and economic run cuts constrained activity. Crude runs will average 82.7 mb/d in 2024 and 83.3 mb/d in 2025, up by 520 kb/d and 620 kb/d, respectively. Margins improved in Asia in November as middle distillate cracks strengthened, but lower gasoline and naphtha values muted them in the Atlantic Basin.

Global observed oil inventories drew by 39.3 mb in October, led by an exceptionally sharp decline in oil products (-82.3 mb) as low refinery activity coincided with a rise in global oil demand. OECD industry stocks declined by 30.9 mb to 2 778 mb, 91.6 mb below the five-year average. Preliminary data for November show global inventories rebounded, led by oil on water and non-OECD crude oil.

Benchmark crude oil futures were largely unchanged in November, at around $73/bbl for ICE Brent. Prices traded in a relatively narrow $5/bbl range, as concerns oscillated between oil supply security and faltering oil demand growth. Volatility slumped to six-month lows, with the front-month Brent futures moving by a daily $0.87/bbl on average during November.

An uneasy calm

The decision by OPEC+ to delay the unwinding of its additional voluntary production cuts by another three months and extend the ramp-up period by nine months through September 2026 has materially reduced the potential supply overhang that was set to emerge next year. Even so, persistent overproduction from some OPEC+ members, robust supply growth from non-OPEC+ countries, and relatively modest global oil demand growth leave the market looking comfortably supplied in 2025.

Ministers of the eight OPEC+ countries that had agreed on extra output reductions of 2.2 mb/d in November 2023 confirmed at last week’s meeting a further delay in restoring these volumes to the market. The postponement was the third since September and came against a backdrop of heightened geopolitical tensions that have raised potential supply risks and slowed global oil demand growth led by China. The cuts will now, at the earliest, be phased out from the end of March 2025 through September 2026.

Yet the latest OPEC+ decision does not remove the uncertainty about when the unwinding of the cuts will start. In this context, our forecasts exclude a return to higher production quotas until a final phase-out timeline is confirmed. On that basis, our current market balances still indicate a 950 kb/d supply overhang in 2025. If OPEC+ does begin unwinding the voluntary cuts from the end of March 2025, this overhang would rise to 1.4 mb/d. A key uncertainty for the trajectory of OPEC+ crude supply remains the level of compliance with agreed targets, with our estimates showing collective output 680 kb/d above targets in November.

OPEC+ crude oil production may still rise next year if Libya, South Sudan, and Sudan can sustain production and as Kazakhstan’s 260 kb/d Tengiz expansion comes online. Globally, the bulk of supply growth will continue to be dominated by non-OPEC+ countries, with the US, Brazil, Canada, Guyana, and Argentina adding more than 1.1 mb/d of crude oil and NGL output between them. The start-up of Saudi Aramco’s Jafurah gas project next year will also boost Saudi Arabia’s NGL supply.

While the market is closely assessing ongoing geopolitical tensions and evolving OPEC+ supply dynamics, the bigger question for 2025 remains global oil demand. The abrupt halt to Chinese oil demand growth this year – along with sharply lower increases in other notable emerging and developing economies such as Nigeria, Pakistan, Indonesia, South Africa, and Argentina – has tilted consensus towards a softer outlook. In a break from recent trends, non-OECD oil demand in 3Q24 was up only 320 kb/d y-o-y, its lowest quarterly growth rate since the height of the pandemic, while OECD countries posted an increase of 190 kb/d y-o-y in the same quarter.

The relatively subdued pace of global oil demand growth is set to continue in 2025, accelerating only modestly from 840 kb/d in 2024 to 1.1 mb/d, with overall consumption reaching 103.9 mb/d. Additional demand for crude or refined products could come from discretionary inventory builds to bring industry stocks back in line with historical averages and as governments replenish strategic reserves. As the year draws to a close, oil markets appear relatively calm, with crude oil trading in a $70-75/bbl range. But, as recent years have shown, market shocks can arrive with little or no warning, making close attention to oil security as important as ever.”

Overall, the International Energy Agency's (IEA) December 2024 Oil Market Report provides an updated outlook on global oil demand and supply for 2024 and 2025.

Global Oil Demand:

For 2024: The IEA has revised its global oil demand growth estimate downward to 840,000 barrels per day (bpd); i.e. -0.84 mbpd reflecting a slowdown in demand, particularly from China and other non-OECD countries.

For 2025: Despite the current year's slowdown, the IEA anticipates an acceleration in demand growth to 1.1 mbpd in 2025, driven primarily by emerging markets in Asia; driven by anticipated economic recovery and stimulus measures in China and the U.S., leading to total oil consumption of 103.9 mbpd.

Global Oil Supply:

Non-OPEC Production:

The IEA expects global oil supply to rise by 0.63 mbpd in 2024 and by 1.9 mbpd in 2025, reaching approximately 104.8 mbpd. This increase is largely attributed to robust production growth from non-OECD countries, particularly the U.S., Brazil, Guyana, Canada, and Argentina. If OPEC+ maintains its current output cuts, a supply overhang of 0.95 mbpd is anticipated in 2025. Should OPEC+ begin unwinding these cuts by March 2025, the overhang could increase to 1.4 mbpd.

OPEC+ Production Cuts: OPEC+ has extended voluntary production cuts of 2.2 mbpd until the end of March 2025. Despite these cuts, the IEA suggests that the market will remain well-supplied due to robust non-OPEC production.

Market Balance and Outlook: The IEA forecasts a supply surplus in 2025, indicating a "comfortably supplied" market, reflecting a persistent oversupply situation due to strong non-OPEC+ production and moderate global demand growth. This outlook is influenced by factors such as China's economic challenges and a global shift towards electric vehicles (EV), which are moderating oil demand growth.

In summary, while the IEA anticipates a rebound in oil demand growth in 2025, increased production from non-OPEC countries is expected to keep the market well-supplied, potentially exerting downward pressure on oil prices. The report highlights that global oil stocks have decreased recently, but overall inventory levels remain within historical ranges. In October alone, stocks fell by 39.3 MB, with a significant decline in oil products attributed to seasonal refinery maintenance coinciding with rising demand. The IEA's analysis underscores a cautious outlook for the oil market in 2025, balancing increased demand against robust supply growth. The ongoing dynamics within OPEC+ and geopolitical factors will continue to play crucial roles in shaping future market conditions.

On the other side, OPEC's Dec’24 Monthly Oil Market Report updated forecasts and insights into the global oil market for 2024 and 2025:

Global Oil Demand:

For 2024: OPEC has revised its oil demand growth forecast downward for the 5th consecutive month, now projecting an increase of 1.61 mbpd, down from the previous estimate of 1.82 mbpd. This adjustment reflects weaker demand in key regions, including China and India. OPEC has revised its global oil demand growth forecast down to 1.82 million barrels per day (bpd), a decrease of 107,000 bpd from the previous estimate of 1.93 million bpd. This marks the fourth consecutive month of downward revisions, attributed to updated data reflecting weaker demand, particularly from China and other non-OECD countries.

For 2025: The demand growth forecast has been further reduced to 1.45 mbpd, a decrease from the earlier projection of 1.54 mbpd. This revision considers bearish third-quarter data and a notable year-on-year contraction in China's oil demand. The demand growth projection for 2025 has also been lowered to 1.54 million bpd, down from 1.64 million bpd. Despite these reductions, OPEC maintains that these figures indicate a strong recovery compared to pre-pandemic levels.

Global Oil Supply:

OPEC+ Production Adjustments: In response to market conditions, OPEC+ has delayed its planned output increase until April 2025, extending voluntary production cuts totaling 2.2 mbpd until March 2025. Additionally, cuts of 2 mbpd and 1.65 mbpd have been prolonged until 2026, emphasizing the group's focus on price stability over market share. OPEC's report indicates an upward revision in non-OECD oil supply growth for both 2024 and 2025, driven primarily by robust production capabilities in the United States and Canada. This adjustment reflects a more optimistic outlook for non-OPEC supply growth in these years,

Non-OPEC Supply: Supply growth from non-OPEC countries, particularly the US and Canada, has led to an upward revision of non-OPEC supply estimates. This increase is contributing to a well-supplied market despite OPEC+ production cuts. The overall oil supply is expected to increase as OPEC+ continues its voluntary production cuts, which were officially extended until the end of December 2024. This strategy aims to stabilize prices amid fluctuating demand forecasts

Market Balance and Outlook:

OPEC's latest report indicates a cautious outlook for the oil market, with demand growth forecasts being trimmed due to weaker global consumption and softer prices. Despite these downward revisions, the projected demand growth remains above the historical average of 1.4 mbpd. The extension of production cuts by OPEC+ underscores the group's commitment to managing supply to support market stability.

In summary, OPEC's December 2024 report highlights a tempered outlook for oil demand growth in 2024 and 2025, influenced by economic factors in major consuming countries and ongoing adjustments in production strategies by OPEC+ to maintain market equilibrium. The report highlights a tightening market balance due to the combination of lower demand forecasts and stable supply growth. However, OPEC acknowledges that oil prices have trended downward recently, reflecting concerns over slowing global demand. The organization (OPEC) continues to monitor the situation closely, particularly focusing on developments in major consumer markets like China, where diesel consumption has reportedly fallen for several consecutive months.

The November OPEC Monthly Oil Report underscores ongoing adjustments in global oil demand and supply forecasts, driven by changing economic conditions and updated data insights. While the organization remains cautiously optimistic about future demand growth, particularly in light of recovery trends post-pandemic, the revisions reflect a more tempered outlook amid uncertainties in key markets.

The forecasts for global oil demand, supply, and balance from the International Energy Agency (IEA), Organization of the Petroleum Exporting Countries (OPEC), and the U.S. Energy Information Administration (EIA) for 2023, 2024, and 2025 show notable variations among these organizations.

Overall, oil surged over 8% in December and January (till 6th). Oil was boosted by signs of rebalancing, OPEC* pledge to postpone production hike at least H1CY25, synchronized global stimulus along with China, forecast of unusually colder weather and some decrease in OPEC production, and lingering Gaza and Ukraine war tensions. But oil was also undercut by hopes of an imminent Gaza and Ukraine war ceasefire as Trump is set to control US geopolitics & policies from 3rd week of Jan’25. Also under Trump, the US may encourage aggressive fracking and higher oil production, negative for oil; but at the same time, Trump’s hawkish policy for Iran may be positive for oil as in that scenario, Trump may limit Iran's export and promote US export.

Market Impact:

On early Monday, USD slumped, while Gold, Oil, Wall Street Futures surged after a WAPO report suggested moderate Trump trade war 2.0 as President-elect Trump’s aides (advisors) may be planning to impose additional tariffs only on selected imports critical for national or economic security, not on everything as was campaigned by Trump. However, later Trump rebutted this report, saying his plan for universal tariffs as high as 10%-20% won’t be pared back. As a trade war currency, the hawkish Trump trade war 2.0 policy will be positive for USD and vice versa.

Trump said in his Truth handle:

“The story in the Washington Post, quoting so-called anonymous sources, which don't exist, incorrectly states that my tariff policy will be pared back. That is wrong. The Washington Post knows it's wrong. It's just another example of Fake News.”

Trump also commented on Biden’s disapproval of an M&A deal between US Steel and Nippon Steel worth around $14.9B; both companies filed lawsuits against the US government for ‘illegal interference’.

“Why would they want to sell U.S. Steel now when Tariffs will make it a much more profitable and valuable company? Wouldn’t it be nice to have U.S. Steel, once the greatest company in the World, lead the charge toward greatness again? It can all happen very quickly!”

Trump is also facing hush money sentencing and he has filed a petition to delay the sentencing. On the weekend, Trump said:

“D.A. Alvin Bragg never wanted to bring this lawless case against me. He was furious at the way it was handled and especially angry at MARK POMERANTZ  for his behavior, and what he did. Ultimately, the Biden/Harris DOJ forced Bragg to concoct anything to embarrass TRUMP. But it was even more so what the CORRUPT and TOTALLY CONFLICTED POLITICAL HACK Judge did, and is doing, on this sham trial. I even have, STILL, an Unconstitutional Gag Order where I am not allowed to speak about the Judge’s highly disqualifying Conflicts of Interest. Virtually every legal scholar and pundit says THERE IS NO (ZERO!) CASE AGAINST ME. The Judge fabricated the facts, and the law, no different than the other New York Judicial and Prosecutorial Witch Hunts. That’s why businesses are fleeing New York, taking with them millions of jobs, and BILLIONS OF DOLLARS IN TAXES. The legal system is broken, and businesses can’t take a chance on getting caught up in this quicksand. IT’S ALL RIGGED, in this case against a political opponent, ME!!!”

Trump filed on Monday for a delay in the sentencing of his case before the New York Supreme Court in which he was found guilty of 34 counts of first-degree falsifying business records. The court filing came on the day Congress is supposed to confirm Trump's victory in the 2024 presidential election. The sentencing is scheduled for Friday. Previously, New York Supreme Court Judge Juan Merchan dismissed Trump's attempt to have the conviction canceled overall on the grounds he is the incoming president. Although Trump will be not awarded any jail term because of his Presidential immunity, any symbolic sentences in this hush money case would be politically damaging for him.

Incoming President Trump also commented about his potential plan of action on the economic front soon after he takes charge from outgoing Biden:

“Members of Congress are getting to work on one powerful Bill that will bring our Country back, and make it greater than ever before. We must Secure our Border, Unleash American Energy, and Renew the Trump Tax Cuts, which were the largest in History, but we will make it even better - NO TAX ON TIPS. IT WILL ALL BE MADE UP WITH TARIFFS, AND MUCH MORE, FROM COUNTRIES THAT HAVE TAKEN ADVANTAGE OF THE U.S. FOR YEARS. Republicans must unite, and quickly deliver these Historic Victories for the American People. Get smart, tough, and send the Bill to my desk to sign as soon as possible. MAKE AMERICA GREAT AGAIN!”

On Monday, soon after the US spot market opened, Gold and oil stumbled, while Wall Street Futures got an additional boost on hopes of an imminent Gaza war ceasefire as US Secretary of State Blinken urged Hamas to make "the final necessary decisions" to reach a Gaza ceasefire and hostage deal before outgoing US President Biden leaves the White House. Blinken voices confidence that a Gaza ceasefire and hostage deal will come together, but possibly after US President Joe Biden leaves office on January 20:

“If we don’t get it across the finish line in the next two weeks, I’m confident that it will get its completion at some point, hopefully, sooner rather than later, and when it does, it will be based on the plan that President Biden put forward”.

On Sunday, Hamas was said to have agreed with Israel on a list of 34 hostages to be released in the first phase of a potential ceasefire deal, but the Palestinian terror group was refusing to detail who of them was alive. an unnamed senior Israeli official, that Hamas had approved the list in exchange for an “appropriate price” — meaning the number of Palestinian security prisoners to be freed as part of the deal — but by refusing to say who was alive and who wasn’t, made it impossible to determine which price would be appropriate.

On Monday, a Saudi newspaper a list of the 34 hostages slated for release in the initial stage of a possible agreement for a ceasefire and hostage exchange between Israel and Hamas. This list reportedly comprises two children, 10 women, 11 elderly men, and 11 men under the age of fifty. The report mentions that an official from the militant group claims it could take approximately a week to assess the status of each hostage. However, Hamas has declined to confirm which individuals on this list are still alive. Earlier reports suggested that discussions concerning the hostage swap and ceasefire agreement were being renewed in Qatar. Part of these negotiations includes talks about Israel providing immunity to all Hamas leaders, albeit with the condition that they would be exiled to a different nation.

But hostage families requested Trump, Israeli government to close a deal to bring all 100 captives home- ‘Don’t leave any hostage behind’: Meanwhile, Trump reiterated his threat to Hamas:

·         Those hostages have to get out, they have to get out now

·         Asked what he meant when he said previously that there would be “hell to pay” if the hostages aren’t released before he takes office on January 20

·         Exactly what it says — if those hostages aren’t released by the time I get office there will be hell to pay

·         I don’t think I have to get into it… But it won’t be the word ‘don’t

·         There will be hell to pay (repeats)

·         Those hostages have to get out, they have to get out now

·         I’m with Israel. I think that’s pretty obvious to everybody… I do have to add, that I’m also for peace. It’s time.

·         This fight’s been going on for a long time, longer than people would understand

Bottom line:

With growing usage of EVs and other green techs/shifts in major economies including China, the US and the EU, the oil may be muted in 2025-26; but if there is an all-out war between Israel and Iran, the oil may boil in the coming months; as of now, that probability is low under Trump.

Weekly-Technical trading levels: DJ-30, NQ-100, SPX-500, Gold and oil

Looking ahead, whatever the fundamental narrative, technically Dow Future (CMP: 42850) now has to sustain over 42300-42600 for any rebound to 43300/43500-43800/44000 and further 44400/44600- 45000/45500 and further 45800/46000-46200/46400 and 46800/47000-47500/48000 in the coming days; otherwise sustaining below 42250, DJ-30 may further fall to 41800/41500-40500/40400 in the coming days.

Similarly, NQ-100 Future (21350) has to sustain over 21200 for a recovery to 21500/21700-21800/22250 and further 22500/22700-23000/23300 in the coming days; otherwise, sustaining below 21150-21000, NQ-100 may further fall to 20800/20650-20450/20250 and 20000/19800-19650/19150 in the coming days.

Technically, SPX-500 (CMP: 5950), now has to sustain over 5900 for any further rally to 6000/6050-6100/6150 and 6200/63990-6350/6500 in the coming days; otherwise, sustaining below 5850, SPX-500 may further fall to 5775 and 5675/5600-5550/5500 in the coming days.

Also, technically Gold (CMP: 2630) has to sustain over 2665-2685 for a recovery to 2700-2725 and further 2735/2750-2775/2795 and 2815 in the coming days; otherwise sustaining below 2650-2640 may again fall to 2605/2600 and 2590/2565 and further fall to 2550/2500-2470/2450 in the coming days (depending upon Fed rate cuts, Gaza/Ukraine war trajectory); Gold surged almost 75% in the last one year since Gaza war started back in October’23. Now it may retrace to $2500-2400 levels if Trump indeed can mediate both the Gaza and Ukraine war ceasefire by early 2025.

Technically Oil (74.00) now has to sustain over 76.00 for 79.00/80.00 and any further rally to 82.00/85.00-88.00/90.00 and 91.00-95.00; otherwise sustaining below 75.50-73.50, oil may again fall to 73.00/72.00 and 71.00/70.00-69.00/67.00 and further fall to 66.00/65.00*-62.00/60.00-57.00/55.00 in the coming days.