enDaily Analysis 06/09/2024
Latest Economic and Fundamental Insights
The dollar index traded around 101 on Friday, hovering near a one-week low as investors prepared for a highly anticipated August jobs report that could bolster expectations for a large 50 basis point interest rate cut by the Federal Reserve this month.
-Gold steady ahead of US jobs report
-Lower interest rates could reduce the opportunity cost of holding non-yielding gold.
-Recent data has shown a weak labor market, with ADP reporting that U.S. private sector employers hired the fewest workers in 3.5 years in August. This, coupled with a sharp drop in U.S. job openings in July and weak manufacturing activity, has raised concerns about the health of the U.S. economy and fueled expectations of a large 50 basis point interest rate cut this month.
However, an unexpected rise in the Institute for Supply Management’s services purchasing managers’ index, which was driven by increases in new orders and prices, eased some concerns.
However, markets currently price in a 50 basis point cut at 41%, and have increased their bets on a total cut of 125 basis points this year.
Gold is expected to advance during the week.
Gold traded steady at the start of the Asian session. Prices hovered around a one-week high, supported by a weaker US dollar and lower yields as markets assessed the latest US employment data.
Asian stocks held tight ranges and the dollar suffered losses on Friday, as investors awaited U.S. jobs data that could determine the size and speed of future interest rate cuts in the world’s largest economy.
Oil stabilizes ahead of key US jobs report, with Brent trading at $72.00 and WTI at $69.00
“There appears to be a broader caution as market participants still digest the mixed US economic data coming out this week, while the lead-up to the crucial jobs report may limit some risk,” said IG Market Strategist Yip Jun Rong.
Over the week, Brent crude was on track to fall about 8%, while WTI crude was on track to fall about 6%.
-Mixed signals were coming out of the US economy this week, ahead of Friday’s non-farm payrolls data, which is expected to be crucial in determining the size of the US interest rate cut at the Federal Reserve’s meeting on September 17-18.
– U.S. service sector activity remained steady in August, but private sector job growth slowed, consistent with a slowing labor market.
– Bitcoin fell and retested the $55,600 support area. Bitcoin is now struggling and could face hurdles near the $57,000 resistance level.
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.
GOLD
General trend: Upward
Interval: Half an hour (30 minutes)
Current price: 2518.58
Scenario 1: Buy gold with a break and stability above 2524.26, targeting 2530.69 and 2547.82
Alternative scenario: Sell gold with a break and stability below 2512.88 with a target price of 2506.43 and then 2498.60
Comment: Trading above the supports and averages suggests an upward trend.
CRUDE OIL
Trend: Down
Interval: Half an hour (30 minutes)
Current price: $69.05 per barrel
Scenario 1: Sell oil by breaking the $68.63 level, targeting $68.11 and then $67.52.
Alternative scenario: Buy oil with a break and hold with a candle closing above $69.31, targeting $69.78 and then $70.34
Comment: Trading below the resistances and averages suggests a decline.
EURUSD
General trend: Upward
Interval: Half an hour (30 minutes)
Current price: 1.11166
First scenario: Buy the Euro-Dollar by breaking 1.11240, targeting 1.11425 and then 1.11649.
Alternative scenario: Sell the EUR/USD with a break and stability with a candle closing below 1.11013, targeting 1.10853 and then 1.10640.
Comment: Trading above the supports and averages suggests an upward trend.
GBPUSD
Trend: Upward
Interval: Half an hour (30 minutes)
Current price: 1.31844
Scenario 1: Buy the pound dollar with a break and stability above the level of 1.31957, targeting the price of 1.32198 and then 1.32484
Alternative scenario: Sell the pound dollar with a break and stability with a close below 1.31658, targeting 1.31416 and then 1.31195
Comment: Trading above the supports and averages suggests an upward trend.
NAS100
Trend: Upward
Interval: Half an hour (30 minutes)
Current price: 18851
Scenario 1: Buy Nasdaq with a break and hold to close above 18965 with a target price of 19073 then 19191
Alternative scenario: Sell Nasdaq with break and hold with close below 18813 with target price of 18688 then 18581
Comment: Trading above the supports and averages suggests an upward trend.
Economic Calendar
(Times are in GMT+3)
-From Europe GDP (YoY) (Q2) 12:00
-From USA Average Hourly Wages (MoM) 15:30
-From USA Non-Farm Payrolls (Aug) 15:30
-From USA Unemployment Rate (Aug) 15:30
Fundamental Analysis
The dollar index traded around 101 on Friday, hovering near a one-week low as investors prepared for a highly anticipated August jobs report that could bolster expectations for a large 50 basis point interest rate cut by the Federal Reserve this month.
The index is on track to lose about 1% this week, as mostly weak U.S. economic data fueled recession fears, prompting traders to price in more aggressive interest rate cuts from the Federal Reserve.
The latest data showed that private companies in the United States added the fewest number of jobs since January 2021, although weekly unemployment claims fell more than expected.
Previous data also showed that job openings unexpectedly fell to their lowest level in more than three years in July and manufacturing activity contracted more than expected in August. Markets are currently pricing in a 40% chance of a 50 basis point rate cut this month, with a total of more than 100 basis points of easing expected this year.
Gold held steady near $2,520 an ounce on Friday, hovering near a one-week high ahead of a closely watched U.S. jobs report that could bolster expectations of a big interest rate cut by the Federal Reserve.
Oil prices rose in Asian trading on Friday, with investors cautious ahead of key U.S. jobs data as they weigh a large draw in U.S. crude inventories and a delay in output increases by OPEC+ producers.
Risk Disclaimer
Any information/articles/materials/content provided by WRC1 or displayed on its website is intended to be used solely for educational purposes only and does not constitute investment advice or a consultation on how the client should trade.
Although WRC1 has taken care to ensure that the content of such information is accurate, - it cannot be held responsible for any omission/error/miscalculation and cannot guarantee the accuracy of any material or any information contained herein.
Therefore, any reliance you place on such material is strictly at your own risk. Please note that the responsibility for using or relying on such material rests with the client and WRC1 accepts no liability for any loss or damage, including without limitation, any loss of profit which may arise directly or indirectly from the use of or reliance on such information.
Risk Warning: FX/CFDs are complex instruments and carry a high risk of losing money quickly due to leverage. You should consider whether you understand how FX/CFDs work and whether you can afford to take the high risk of losing your money.
You should make sure that, depending on your country of residence, you are allowed to trade with WRC1 products. Please ensure that you are familiar with the company’s risk disclosure.
