Daily Market Analysis

 

 

 

Latest Economic and Fundamental Insights

 

The dollar index held above 104 on Wednesday as investors looked to final US services PMI data and private sector employment numbers from ADP, as well as the upcoming monthly jobs report for more insights into the economy and labor market.

-Gold is range-bound as traders seek more US data for Fed signals

-Central bank purchases of gold are strong in April – World Gold Council

-Today’s ADP and non-farm payrolls data due for release on Friday will be closely watched for further clues about the health of the US labor market and whether that will prevent the Fed from cutting interest rates in September.

“The main event is the ISM services report… The ideal scenario for gold bulls is to see ISM services remain just below the 50 level, with the price paid component expanding at a slower pace – because this satisfies a ‘soft landing’ scenario,” said Matt Simpson, chief analyst at City Index. The Fed aims to achieve this.

US services data is scheduled to be released. Markets are also awaiting today’s ADP employment report and Friday’s non-farm payrolls data for further clues on the health of the US economy and whether it will prevent the Fed from cutting interest rates in September. (Fedwatch)

Higher interest rates increase the opportunity cost of holding non-yielding assets.

Global central bank net purchases of gold rose to 33 metric tons in April from a revised net purchase of 3 metric tons in March, the World Gold Council (WGC) said, indicating continued strong appetite from the sector despite rising prices for the metal.

The Chinese yuan fell against the dollar on Wednesday amid continued doubts about the pace of recovery in the world’s second-largest economy, while traders are also awaiting the main US jobs report amid expectations that US interest rates will remain high for a longer period.

-Oil is approaching the lowest level in 4 months after the OPEC+ supply plan, and the increase in US inventory,
with Brent crude trading at $77.00 levels, as well as West Texas crude at $73.00 levels.

-Both contracts fell about a dollar on Tuesday to their lowest settlement levels since early February, and were down about $3 a barrel on Monday.

This decline came in the wake of news from the Organization of the Petroleum Exporting Countries and its allies about plans to increase supplies starting in October, despite recent indications of weak demand growth.

However, Saudi Energy Minister Prince Abdulaziz bin Salman said OPEC+ would temporarily stop unwinding the cuts or reverse them if demand is not strong enough to absorb the barrels.

-Bitcoin price started a new increase above the $70,000 resistance level. BTC is showing positive signs and may rise further above the $72,000 resistance in the near term.

-Bitcoin price found support at $67,000 and started a new increase. Bitcoin has risen above $69,500 and may continue to rise in the near term.

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Smart technical reports

 

 

How they work

A likely scenario is proposed for today, and the probability of this scenario being achieved, according to technical analysis, may be between 60% and 75%.

If the first scenario fails, the probability of the second scenario being achieved will be between 60% and 75% certain.

The first scenario fails when the price reaches the level of the alternative scenario condition, and the alternative scenario is immediately activated and the prediction from the first scenario is cancelled.

These reports are not considered a substitute for the trader’s decision, but rather they are a tool to assist the follower in making his own decisions, as a reference based on the origins of classical technical analysis.

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GOLD

 

General trend: bullish

Time interval: half an hour (30 minutes)

Current price: 2331.15

The first scenario: Buy gold at a break and hold above 2338.60, with a target price of 2345.03 and 2352.16.

Alternative scenario: sell gold at a break and hold below 2327.22, with a target price of 2320.77 and then 2314.54.

Comment: Trading above supports and averages suggests an upward trend

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CRUDE OIL

 

Trend: bearish

Time interval: half an hour (30 minutes)

Current price: $73.00 per barrel

The first scenario: selling oil at a break and holding steady by closing the candle below the $72.70 level, targeting a price of $72.18, then 71.59. Alternative scenario: buying oil at a break of the $73.38 level, targeting a price of $73.85, then 74.41.

Comment: Trading below resistances and averages suggests a decline

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EURUSD

 

General trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.08734

The first scenario: Buying Eurodollars at a break of 1.08898, targeting a price of 1.09082, then 1.09307.

Alternative scenario: sell the euro/dollar at a break and hold firm by closing the candle below 1.08670, targeting the price of 1.08510 then 1.08297.

Comment: Trading above supports and averages suggests an upward trend

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GBPUSD

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.27653

The first scenario: Buying the pound dollar at a break and stability above the level of 1.27898, targeting the price of 1.28184, then 1.28406.

Alternative scenario: sell the pound dollar at a break and hold firm by closing below 1.27562, with a target price of 1.27365 then 1.27141.

Comment: Trading above supports and averages suggests an upward trend

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NAS100

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 18740

The first scenario: Buy the Nasdaq at a break and hold steady with a close above 18781, targeting the price of 18850 then 18930.

Alternative scenario: sell Nasdaq at a break and hold steady by closing below 18679, price 18622, then 18571.

Comment: Trading above supports and averages suggests an upward trend

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Economic Calendar

 

(Times are in GMT+3)

-From the United States of America, the index of change in non-agricultural private sector jobs issued by ADP (May) 15:15

-From the United States of America Services PMI (May) 16:45

– Interest decision issued by the Central Bank of Canada 16:45

-From the United States of America, non-manufacturing purchasing managers’ index issued by the Institute for Supply Management (ISM) (May) 17:00

-US crude oil inventory 17:30

 

Fundamental Analysis

 

 

The dollar index held above 104 on Wednesday as investors looked to final US services PMI data and private sector employment numbers from ADP, as well as the upcoming monthly jobs report for more insights into the economy and labor market.

JOLTS job openings fell more than expected to 8.059 million, the lowest level since February 2021, a sign of a slowing labor market, data showed on Tuesday.

The US ISM Manufacturing PMI report released on Monday also pointed to weak factory activity, reviving hopes for an interest rate cut by the Federal Reserve.

Markets currently expect a roughly 65% ​​chance that the Fed will cut interest rates in September.

Investors are also awaiting monetary policy decisions from the European Central Bank and the Bank of Canada this week, both of which are expected to begin easing policy.

Gold prices rose slightly on Wednesday, supported by lower Treasury yields, but remained stuck in a narrow range as investors waited for more US data to gauge the Federal Reserve’s next move on monetary policy.

Oil prices rose near their lowest levels in four months in Asia on Wednesday as markets digested OPEC+’s decision to increase supplies later this year and after US crude and fuel inventories increased.