Aluminium price pushed by Australian export ban, Brent Crude jumped 15% in a week

[ArvinIG]

Source: Bloomberg

 

Commodities Aluminium Petroleum Brent Crude Metal Benchmark (crude oil)

 

Aluminium

Australia’s ban on alumina and bauxite exports to Russia, the two most essential ingredients for producing aluminium, pushed up the price for the most widely used metal. While aluminium hasn’t been targeted by sanctions, the production of the metal is facing server disruption following the new move.

The 'everyday metal', which is used in everything from the production of cans and smartphones to cars and airplanes, was already running low before the Ukraine war isolated the second-largest exporter from the world economy. As such, the price of aluminium has climbed to its all-time high above $3800 per ton early this month.

The daily chart shows the price has bounced back from 50 MA and targets 20 MA following three consecutive gaining sessions. The long-term bull momentum since December remains valid as demonstrated by the ascending trend line connected by the lows.
The four-hour chart also suggests the strength of the price as the candlestick is now betraying all the major moving averages and is glued in an upward trajectory.

The next resistance is looking at the $3638, which will help the metal regain all the loss in the past two weeks. The months-long trend line will support the price at around $3268 per ton.

Aluminium daily chart

Source: IG

Aluminium hourly chart

Source: IG

Brent Crude

The price of Brent Crude oil has been moving up for the sixth straight day and kicked off the new week by more than a 6% jump. Brent Crude, the global benchmark, is trading as high as $114.80 a barrel on Tuesday, enjoying a weekly gain of over 15%. The price rises in the backdrop of EU foreign ministers meeting in Brussels to discuss further sanctions against Russia.

The price of the most crucial energy fell from its decades-high level two weeks ago and is now attempting to move back to its rooftop. The daily chart shows the price has conquered the short-term indicator to stand on the 20 days moving average, with both 50 and 100 MAs are a distance away.

For the near term, the level of $117.4 would be a key hurdle before the price re-enters into the $120 plus zone. A support area between $108 to $109 can be found from the daily trend line.

From the sentiment point of view, the RSI in the hourly chart has touched on the oversold territory, which could slow down the bull-bias buying in the near term. However, the RSI level from the daily chart is still under the average level for the past two months, meaning there is potential for the price to edge higher.

Brent Crude daily chart

Source: IG

Brent Crude hourly chart

Source: IG

Follow Hebe Chen on Twitter @BifeiChen

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Hebe Chen | Market Analyst, Australia
22 March 2022