I. Precious Metals
Gold
Gold prices extended gains to around $1,220 on Wednesday. On news front, the U.S. economy is healthy enough for the Fed to raise rates and begin winding down its massive bond portfolio, though low inflation and a low neutral rate may leave the central bank with diminished leeway, Fed Chair Janet Yellen said on Wednesday.
Before Congress, Yellen depicted an economy that, while growing slowly, continued to add jobs, benefited from steady household consumption and a recent jump in business investment, and was now being supported by stronger economic conditions abroad. According to her testimony the economy is on an even keel, near or beyond full employment. But she also noted that given current estimates, the federal funds rate "would not have to rise all that much further" to reach a neutral level. Her dovish testimony provided a floor to bullion.
On chart, gold formed a M-shaped top with limited upmomentum. Prices rebounded from $1,200, showing no further decline, suggesting a consolidation in the near term. The support can be found at $1,200 and $1,180 successively, while resistance can be found at the 200-day moving average of $1,232.

Silver
Silver rose on Wednesday, but failed to regain the ground of $16. On technical front, the downward path remained on track, a possible weight on its rising potentials. We maintain our vies that the support and resistance can be found at $15 and the 50-day moving average of $16.74 respectively.

II. Commodities
Crude Oil
Oil futures rose, maintaining some gains from earlier in the day, as a report showing hefty drawdowns in U.S. crude inventories was offset by data pointing to lackluster gasoline demand.
U.S. crude inventories fell 7.6 million barrels last week, its biggest weekly plunge in 10 months, the U.S. Energy Information Administration (EIA) said. That was much more than the 2.9 million-barrel crude draw forecast in a Reuters poll but was slightly less than the 8.1 million-barrel decline reported by the American Petroleum Institute (API) on Tuesday. U.S. gasoline demand remains lackluster and gasoline stocks are still above the five-year average, which will cap gains in crude and gasoline prices. Oil prices are expected to remain rangebound between $42-47.

Copper
Copper prices kept rising on Wednesday as workers voted to strike at a mine in Chile, raising supply concerns. On technical front, the MACD is about to form a gold cross. Crossing over the key mark of $6,000 would open up further rising potentials. But the upward momentum column of the MACD shows signs of declining, a weight on copper prices.

Soybean
U.S. soybean futures closed lower on Wednesday, snapping a 11-day winning streak, on profit-taking and forecast models calling for milder conditions in the Midwest. August soybeans fell 8-1/2 cents at $10.20-3/4 a bushel, while November soybeans dropped 9-1/4 cents to $10.34 per bushel, the first decline sine June 23. CBOT soybeans briefly turned higher after the USDA lowered its soy ending stocks forecasts for both the 2016/17 and 2017/18 marketing years. The trading volume for soybean, soymeal and soyoil stood at 328,245, 137,119 and 152,172 lots respectively.

Dealing Room, ICBC Beijing Branch
Cheng Yu