Commodities Daily - October 30, 2019

> Oil flat amid reports of US-China deal delay; EIA, macro data in focus. We expect the EIA to report a crude stockpile build of 2-3 mln bbl last week, which would be above the consensus and more bearish than the API's estimate. However, bullish refined product data could overshadow this, making the price correction less pronounced. Investors will also eye the EIA's 914 report on US oil production in August. Output fell for a third straight month in July, to 11.81 mln bpd, but the August data is likely to show an uptick. Today's macro data releases include the US ADP employment report for October and US 3Q19 GDP, which will be followed by the Fed decision at 21:00 Moscow time. We expect Brent to encounter technical resistance at $60.83/bbl, a Fibonacci retracement level, today. If it breaks through, it could move on to its 50-day moving average of $60.79/bbl and then to $60.29/bbl, another Fibonacci retracement level.> Gold edges lower after latest Brexit news; Fed rate decision and Powell's rhetoric in focus. Safe-haven assets are likely to get a boost from US economic data midday. As for the Fed decision, we think that broadly downbeat US economic data for September will convince a majority of FOMC members of the need for another 25 bp cut. However, given that the US and China appear to be on their way to signing a "phase one" trade deal in mid-November, we expect Powell to be less dovish in his speech than the market expects. This would trigger some risk-off trading and be supportive for gold. In this case, we think gold could break above the $1,500/oz threshold, where it will encounter technical resistance at $1,503/oz (Fibonacci retracement level), with the upside limited to $1,518/oz (another Fibonacci level).