enDaily Analysis 07/10/2024
Latest Economic and Fundamental Insights
The dollar index held steady around 102.5 on Monday after rising half a percent in the previous session following a stronger-than-expected U.S. jobs report that prompted markets to discount any chances of another 50 basis point interest rate cut by the Federal Reserve in November.
Gold falls further on strong US jobs data
Nonfarm payrolls rose by 254,000 jobs in September, beating expectations for a gain of 14,000, while the unemployment rate unexpectedly fell to 4.1%.
The data eased concerns about a weak labor market following weaker reports in previous months, limiting the size of expected cuts in the current cycle.
-Low interest rates reduce the opportunity cost of holding non-interest-bearing bullion assets.
Markets now await the latest Federal Reserve meeting minutes on Wednesday and the CPI report on Thursday for further guidance.
Meanwhile, gold’s upward trend is supported by its status as a safe haven asset, which is reinforced by the increasing violence in the Middle East.
Gold falls on weak sentiment
Gold fell in early Asian trade. Strong U.S. jobs data eased pressure for further interest rate cuts by the Federal Reserve.
-And they reduced the chances of another 50 basis point cut in November. They added that this limited safe-haven buying, as markets also digested geopolitical tensions in the Middle East.
Oil prices fell after the strongest weekly rise in more than a year, with Brent crude trading at $77.00 and West Texas Intermediate at $73.00.
Brent crude rose more than 8% last week, its biggest weekly gain since January 2023, while the West Texas Intermediate contract rose 9.1% on a weekly basis, its biggest since March 2023, amid expectations that Israel could strike Iranian oil infrastructure in retaliation for an Iranian missile attack on Israel on October 1.
However, as the Israeli response is still developing, some investors are likely to sell futures to preserve their gains from the previous week’s rally.
“Technical profit-taking seems to be the most plausible explanation,” said Priyanka Sachdeva, senior market analyst at Philip Nova, commenting on Monday’s oil price decline.
However, oil markets are still expected to see tailwinds amid fears of an Israeli response to Iran, as a potential escalation of the wider conflict in the Middle East has put increasing pressure on demand, Sachdeva said.
-Israel struck Hezbollah targets in Lebanon and the Gaza Strip on Sunday ahead of the first anniversary of the Oct. 7 Hamas attacks on Israel that sparked the current war between Israel and Iranian-backed militant groups. Its defense minister also said all options were open to respond to Iran.
Last week, Iran launched a missile attack on Israel in response to recent Israeli attacks on Hezbollah in Lebanon and its prolonged incursion into Gaza against Hamas following its October 7 attack.
-Bitcoin price has started to rise again above the $62,000 area. Bitcoin is gaining momentum and could target further gains above the $63,500 area.
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: 2643.31
Scenario 1: Buy gold with a break and stability above 2649.58 with a target price of 2656.01 and 2663.14.
Alternative scenario: Sell gold with a break and stability below 2638.20 with a target price of 2631.75 and then 2623.92.
Comment: Trading above the supports and averages suggests an upward trend.
CRUDE OIL
Trend: Upward
Time: Half an hour (30 minutes)
Current price: $73.81 per barrel
Scenario 1: Buy oil by breaking the $74.24 level, targeting $74.71 and then $75.27.
Alternative scenario: Sell oil by breaking and holding steady by closing a candle below the $73.68 level, targeting $73.04 and then $72.46.
Comment: Trading above the supports and averages suggests an upward trend.
EURUSD
General trend: Down
Interval: Half an hour (30 minutes)
Current price: 1.09641
First scenario: Sell the Euro Dollar by breaking 1.09582, targeting 1.09423 and then 1.09210.
Alternative scenario: Buy the Euro Dollar by breaking and holding steady with a candle close above 1.09810, targeting 1.09994 and then 1.10219.
Comment: Trading above the supports and averages suggests an upward trend.
GBPUSD
Trend: Down
Time interval: half an hour (30 minutes)
Current price: 1.31119 Scenario 1: Sell GBP/USD with a break and stability above 1.30969, targeting 1.30729 then 1.30507
Alternative scenario: Buy GBP/USD with a break and stability with a buy close of 1.31270, targeting 1.31510 then 1.31797
Comment: Trading below the resistances and averages suggests a decline.
NAS100
Trend: Upward
Time interval: half an hour (30 minutes)
Current price: 20190 Scenario 1: Buy Nasdaq with a break and hold at a close above 20260 with a target price of 20363 then 20481
Alternative scenario: Sell Nasdaq with a break and hold at a close below 20108 with a target price of 19978 then 19871
Comment: Trading above the supports and averages suggests an upward trend.
Economic Calendar
(Times are in GMT+3)
From China China’s foreign exchange reserves (USD) (September) 11:00
Fundamental Analysis
The dollar index held steady around 102.5 on Monday after rising half a percent in the previous session following a stronger-than-expected U.S. jobs report that prompted markets to discount any chances of another 50 basis point interest rate cut by the Federal Reserve in November.
Nonfarm payrolls rose by 254,000 jobs in September, data showed on Friday, beating expectations of 140,000, while the unemployment rate fell to 4.1% from 4.2%.
Markets now see a 95% chance of a more modest 25 basis point rate cut in November and a 5% chance of no change in the interest rate.
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