I. Precious Metals
Gold
Gold fell more than 1 percent on Monday, giving up the prior session's gains on pressure from the rising dollar, expectations for U.S. interest rate hikes and as the market entered a holiday week. Spot gold was down 1.4 percent at $1,275.66 an ounce, off Friday's peak of $1,297, its strongest since Oct. 16.

The U.S. dollar touched its highest against a basket of major currencies in nearly a week, as the euro weakened amid political risks linked to German Chancellor Angela Merkel's failure to form a three-way coalition government. Global equities rose as confidence over economic growth around the world helped investors brush off concerns about the collapse of government talks in Germany.

The prospect of higher U.S. interest rates when the Federal Reserve meets in December helped the dollar and weighed on bullion. Market concern over U.S tax overhaul last week and probe into Russia’s meddling in U.S. Presidential election failed to lifted gold high, suggesting that investors are still watching the impact of  U.S. interest rate hikes at year-end.

On technical front, gold closed around the 100-day moving average, still within the trading range since October. A further decline would pull gold to around the 50-day moving average of $1,265. On trading strategy, investors shall sell on high if no sharp losses are seen in stock markets.

Silver

Silver was down 2.3 percent at $16.90 an ounce, tracking gold’s trajectory to the trading range of $16.5 to $17.5. The near-term and medium-term investors shall sell on highs ahead of Fed’s policy meeting. While for long-term investors, we believe they shall wait until the Fed’s policy meeting as it’s not a good entry point.

II. Commodities
Crude Oil

Oil prices fell 0.8 percent on Monday, extending recent weakness ahead of next week's OPEC meeting, while a rally in the dollar hurt commodities across the board.

U.S. West Texas Intermediate (WTI) crude futures settled down 46 cents or 0.8 percent to $56.09, while Brent crude futures fell 50 cents or 0.8 percent to $62.22 a barrel.

Oil is expected to remain high ahead of the OPEC meeting due late November, and to pull back after the meeting. Market bulls will take profits if the group extends the cut agreement to cover the whole of next year. But losses would be limited. Without an extension, prices will drop sharply.

On technical front, the daily MACD momentum column is negative, suggesting peaking. Investors shall wait till the OPEC meeting for proper opportunity.

Copper

Benchmark copper on the London Metal Exchange ended 0.8 percent up at $6,828 a tonne, having posted its second weekly decline on Friday. Its momentum remained weak above the 50-day moving average of $6,745.

We are bearish on the base metal in near term despite on-warrant LME inventories in approved warehouses dipped to the lowest level in more than two months. A pullback in stock market is expected to drag copper down.

Soybean

U.S. soybean futures eased amid steep declines in palm oil, despite of a boost from dry weather in South America. CBOT January soybean futures finished 1/2 cent lower at $9.90 after hitting a one-week high of $9.92 on Friday. The USDA data showed that soybean harvest was 97 percent complete by Sunday.

Dealing Room, ICBC Beijing Branch
                         Qin Gang