Crude oil prices appear vulnerable if traders leery of what may emerge from Cyprus over the weekend liquidate positions across the risky asset spectrum.

Talking Points

• Crude Oil, Copper May Fall if Cyprus Weekend Risk Sparks Liquidation

• Gold and Silver May Rise as Eurozone Instability Fears Continue to Spread

Commodity prices are little changed in European trade as markets wait for concrete guidance on the developing turmoil in Cyprus. The European Central Bank (ECB) has given the troubled island nation until Monday to reach agreement on an EU bailout plan before it cuts off Cypriot banks’ access to emergency funding facilities. Cyprus needs to raise €5.8 billion to unlock another €10 billion in rescue funds from the so-called “troika” (EU/ECB/IMF).

The outlines of such a deal remain clouded in uncertainty as policymakers scramble to find a new path forward after a plan to apply a levy on depositors foundered earlier in the week. Traders may be reluctant to hold significant exposure to risky assets over the weekend having been similarly ambushed just five days ago. That suggests an unwinding of positions may play out through final hours of the week, weighing on cycle-sensitive crude oil and copper prices while boosting gold and silver on a pick-up in alternative store-of-value demand.

WTI Crude Oil (NY Close): $92.45 // -1.05 // -1.12%

Prices consolidating above support at the 92.00 figure, marked by the 23.6% Fibonacci expansion. Near-term resistance is at 93.77, the 50% Fib retracement. A break above that targets the 61.8% level at 94.82. Alternatively, a break below support exposes the 38.2% level at 90.73.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1614.88 // +8.05 // +0.50%

Prices broke above resistance at 1604.87, the 38.2% Fibonacci retracement, with buyers eyeing the 50% level at 1620.28. A further push above that aims for the 61.8% Fib at 1635.68. The 1604.87 mark has been recast support, with a turn back beneath that eyeing the 23.6% retracement at 1585.81.

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $29.18 // +0.35 // +1.21%

Prices continue to consolidate above support at 28.46, the 23.6% Fibonacci expansion. Near-term resistance is in the 29.42-92 area, with a break higher exposing a falling trend line now at 30.28. Alternatively, a reversal below support targets the 38.2% level at 27.86.

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.436 // -0.010 // -0.29%

Prices are testing above resistance at 3.447, the 14.6% Fibonacci retracement. A break higher exposes the 23.6% level at 3.483. Near-term support is at 3.388, the March 19 swing low.