Daily Market Analysis

 

 

 

Latest Economic and Fundamental Insights

 

 

The US dollar steadied slightly ahead of inflation data and as the probability of a June rate cut rose slightly from Monday, with the European Central Bank meeting also in focus.

Ahead of Wednesday’s Consumer Price Index data, the US interest rate futures market raised the probability of a June rate cut to 57.6%, up from 49% late Monday, according to the Chicago Mercantile Exchange’s FedWatch tool.

For 2024, federal funds futures are priced in for about 65 basis points of cuts, or less than three rate cuts of 25 basis points each.

The US dollar ended last week lower as traders digested mixed economic data, including a surprise slowdown in US services sector expansion and stronger-than-expected US job growth.

There is understandable caution about a potentially weaker reading that could quickly lead to a resurgence in expectations of a June rate cut.

Focus on US CPI, with easing geopolitical tensions potentially boosting dollar demand

Gold hovers near record high as rising inflation risks boost safe-haven appeal

• Gold hit an all-time high of $2365.09 an ounce on Tuesday
• Silver hits highest level since June 2021
• US CPI and Fed minutes due Wednesday

“Gold is deviating from its traditional drivers… due to geopolitical tensions, emerging market central banks are stocking up on gold to diversify risks, and some volatility in the Chinese currency and the emergence of inflation risks are driving prices at the moment.” said Soni Kumari, a commodity strategist.

Strong central bank buying, inflows into safe havens amid rising geopolitical risks and demand from momentum funds have boosted bullion gains by 14% so far this year.

The strong US jobs report last week, which defied expectations, raised further questions about the need for rate cuts this year.

Senior analysts said a strong CPI reading is likely to push markets to price in a June cut, which could lead to a sharp rise in the dollar.

BOJ Governor Kuroda says BOJ will consider policy change if yen weakness causes inflation to exceed target

Tesla stock jumps 5% after Musk unveils Robotaxi on August 8

Oil steadies as Middle East concerns offset US crude stock build

• Brent crude trades at $89.00 and West Texas Intermediate crude at $84.00
• The two benchmarks remained down about 1.8% from the end of last week despite geopolitical tensions in the Middle East due to the possibility of the Israeli war in Gaza continuing for a longer period and dragging in more countries.

Hamas said on Tuesday that the Israeli ceasefire proposal in its war in Gaza does not meet the demands of the armed Palestinian factions but it will study the offer more deeply and will submit its response to the mediators.

If the conflict continues, it risks dragging in other countries in the region, especially Iran, which supports Hamas, and the third largest producer in the Organization of the Petroleum Exporting Countries (OPEC).

Bitcoin price moves higher above the $71,200 resistance level. BTC shows positive signs and could soon extend its gains above $72,500.

---

 

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: bullish

Time interval: half an hour (30 minutes)

Current price: 2356.87

The first scenario: Buy gold at a break and hold above 2359.22, with a target price of 2365.65 and 2372.98. Alternative scenario: Sell gold at a break and hold below 2347.84, with a price target of 2341.39 and then 2334.03. Comment: Trading above supports and averages suggests an upward trend

---

 

CRUDE OIL

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: $84.67 per barrel

The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $85.06, targeting a price of $85.52, then 86.09. Alternative scenario: Selling oil at a break of $84.38, targeting a price of $83.86, then 83.27.

Comment: Trading above supports and averages suggests an upward trend

---

 

EURUSD

 

General trend: – Bearish

Time interval: half an hour (30 minutes)

Current price: 1.08525

The first scenario: sell the euro/dollar at a break of 1.08471, targeting a price of 1.08311, then 1.08098. Alternative scenario: buy the euro/dollar at a break of 1.08698, targeting a price of 1.08883, then 1.09107.

Comment: Trading below resistances and averages suggests a decline

---

 

GBPUSD

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.26770

The first scenario: Buy the pound dollar at a break and hold at the highest level of 1.26941, targeting a price of 1.27227 then 1.27449. Alternative scenario: sell the pound dollar at a break and hold at a close below 1.26605, targeting a price of 1.26408 then 1.26184. Comment: Trading above supports and averages suggests an upward trend 1.26408

---

 

NAS100

 

Trend: down

Time interval: half an hour (30 minutes)

Current price: 18383

The first scenario: Selling the Nasdaq at a break and holding steady with a close below 18351, targeting the price of 18309 then 18265. The alternative scenario: Buying the Nasdaq at a break and holding steady with a close above 18410, targeting the price of 18449 then 18495.

Comment: Trading below resistances and averages suggests a decline

---

 

Economic Calendar

 

(Times are in GMT+3)

There is no important data released today.

 

Fundamental Analysis

 

 

The dollar held steady on Wednesday ahead of the release of a key inflation report later in the day, while the yen remained away from what markets believe is the Japanese authorities’ intervention line.

Meanwhile, the New Zealand dollar briefly jumped to a three-week high after the Reserve Bank of New Zealand kept interest rates unchanged, as expected, but warned of persistent inflation.

The main market focus on Wednesday is on US consumer price inflation for March, which traders have been eagerly awaiting for clues on the Federal Reserve’s policy outlook.

The inflation data comes on the heels of last Friday’s strong jobs report, which beat expectations and raised questions about when and how much the central bank will cut interest rates this year.

Gold prices steadied on Wednesday near a record high hit in the previous session, as the safe-haven metal was supported by a favorable mix of rising inflation risks and ongoing geopolitical tensions.

Oil prices were little changed on Wednesday after two days of losses, as deadlock in Gaza ceasefire talks renewed uncertainty about Middle East supply security, which offset a larger-than-expected increase in US crude stocks.