enDaily Analysis 10/06/2024
Latest Economic and Fundamental Insights
The dollar index rose above 105 on Monday, heading toward a four-week high, as investors braced for the Federal Reserve’s interest rate decision and CPI report this week.
-Gold stabilizes after falling below the key $2,300 level
Bullion fell more than 3% on Friday after a strong jobs report and China data.
Official data showed on Friday that China’s central bank temporarily halted purchases of gold from its reserves in May, when spot gold prices hit a record high, after 18 months of consecutive purchases.
The US economy created much more jobs than expected in May, and annual wage growth accelerated again, confirming the resilience of the labor market and reducing the possibility that the Federal Reserve will be able to start cutting interest rates in September.
The data once again prompted traders to change their expectations about when the Fed will cut interest rates and by how much. The chances of a rate cut in September are now about 50%, down from about 70% late Thursday.
Low interest rates reduce the opportunity cost of holding non-yielding bullion.
The Fed is not expected to make any changes at its policy meeting this week but the focus will be on Fed Chairman Jerome Powell’s comments and changes in economic expectations from policymakers. US inflation data is also scheduled for release on Wednesday.
Vietnam’s central bank said it “has enough resources and determination” to stabilize the local gold market, amid a sharp rise in local gold prices this year.
-Asian stocks fell on Monday as traders significantly reduced their bets on lowering interest rates by the Federal Reserve (the US central bank) this year in light of the continued tightness of the US labor market, while the call for early elections in France raised broader political concerns and weighed on… On the euro.
-Oil maintains its stability with caution prevailing in the markets, with Brent crude trading at $79.00 levels, as well as West Texas Intermediate crude at $75.00 levels.
Oil prices came under pressure on Friday as strong US jobs data prompted traders to reduce their expectations for a US interest rate cut, dampening expectations for economic growth and energy demand.
-Oil prices ended last week lower as the recent OPEC+ decision raised concerns about excess supply.
-While OPEC+ agreed to extend most supply cuts until 2025, it also announced plans to phase out some voluntary production cuts from eight member countries starting in October.
-Bitcoin price remained above the $68,500 support area. BTC is now consolidating and may aim for a new surge above the $70,150 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: bearish
Time interval: half an hour (30 minutes)
Current price: 2293.27
The first scenario: selling gold at a break and holding below 2290.03, with a target price of 2283.58 and 2277.35.
Alternative scenario: Buy gold at a break and hold above 2301.41, with a target price of 2307.84 and then 2314.97.
Comment: Trading below resistances and averages suggests a decline
CRUDE OIL
Trend: bearish
Time interval: half an hour (30 minutes)
Current price: $75.42 per barrel
The first scenario: selling oil at a break and holding steady by closing the candle below the $74.99 level, targeting a price of $74.47, then 73.88. Alternative scenario: buying oil at a break of the $75.67 level, targeting a price of $76.14, then 76.70.
Comment: Trading below resistances and averages suggests a decline
EURUSD
General trend: bearish
Time interval: half an hour (30 minutes)
Current price: 1.07530
The first scenario: selling the euro/dollar at a break of 1.07418, targeting a price of 1.07258, then 1.07045.
Alternative scenario: Buy the Euro/Dollar at a break and hold by closing the candle above 1.07645, targeting the price of 1.07830 then 1.08054.
Comment: Trading below resistances and averages suggests a decline
GBPUSD
rend: down
Time interval: half an hour (30 minutes)
Current price: 1.27161
The first scenario: selling the pound dollar at a break and holding below the level of 1.27045, targeting the price of 1.26848 then 1.26624.
Alternative scenario: Buy the pound dollar at a break and hold firm by closing above 1.27381, targeting the price of 1.27667 then 1.27888.
Comment: Trading below resistances and averages suggests a decline
NAS100
Trend: bullish
Time interval: half an hour (30 minutes)
Current price: 19027
The first scenario: Buy the Nasdaq at a break and hold steady with a close above 19093, targeting the price of 19163 then 19243.
Alternative scenario: sell Nasdaq at a break and hold firm by closing below 18991, price of 18934, then 18883.
Comment: Trading above supports and averages suggests an upward trend
Economic Calendar
(Times are in GMT+3)
From China and Australia holiday closure
Fundamental Analysis
The dollar index rose above 105 on Monday, heading toward four-week highs, as investors braced for the Federal Reserve’s interest rate decision and CPI report this week.
On Friday, the index rose 0.8% after strong US jobs data prompted traders to reduce their expectations for a cut in federal interest rates.
The data showed that the US economy added 272,000 jobs in May, much higher than the revised reading of 165,000 jobs in April and well above expectations of 185,000 jobs.
Also, wages saw an increase of 0.4%, double what they were in April and exceeding expectations of 0.3%.
Markets are now seeing just one rate cut from the Fed this year, which is expected to happen in November.
The dollar also benefited from the sharp decline in the euro amid political uncertainty in Europe after French President Emmanuel Macron called for early elections after a huge loss to Marine Le Pen’s National Rally party in the European Union elections on Sunday.
Gold prices stabilized on Monday after falling below the key level of $2,300 in the previous session due to stronger-than-expected US jobs data, which dashed expectations of an early cut in interest rates this year.
WTI futures settled above $75.5 a barrel on Monday as caution dominated sentiment ahead of the Federal Reserve’s latest interest rate decision and key US inflation reading this week.
Crude oil rose after OPEC+ ministers said the group still retained the option to pause or reverse oil production changes if necessary, UOB’s global economics and markets research team wrote in a note. OPEC+ recently announced plans to phase out some voluntary production cuts, causing market concerns about potential oversupply
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.
