Daily Market Analysis

 

 

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The dollar index held above 105.5 on Monday, hovering near its highest levels since early May, as the Federal Reserve’s updated projections released last week indicated only one rate cut this year, which could come in late December.

-Gold fell as investors sought more data on Federal Reserve interest rate signals

-Fundamentals still look positive for gold

Data released last week showed some weakness in price pressures

-The Fed’s Kashkari says it’s reasonable to see one rate cut in 2024

“Today’s small move is probably just an unwinding of the move we saw on Friday,” said financial market analyst Kyle Rodda, adding that longer-term fundamentals are very constructive for gold. But it depends on the data.

-US retail sales data is due on Tuesday, weekly jobless claims on Thursday and flash PMIs on Friday. Several Fed officials are also scheduled to speak this week.

“With some signs of weakness emerging in the US economy, which could weaken the US dollar and also increase expectations of future interest rate cuts, gold is in a great position to benefit,” Rhoda added.

Data released last week showed some weakening in price pressures in the US, suggesting that the labor market is losing momentum, keeping hopes alive for an interest rate cut in September.

-Traders see a 68% probability of a cut in September, according to CME Group’s FedWatch tool, compared to 63% before Thursday’s producer price data. (Fedwatch)

However, Minneapolis Fed President Neel Kashkari said on Sunday that it was a “reasonable prediction” that the US central bank would cut interest rates once this year, and wait until December to do so.

-Lower interest rates reduce the opportunity cost of holding non-yielding bullion.

-Nikkei declines, S&P 500 futures stabilize, retail sales rebound in China, and industrial production slows.

The euro is placed on the defensive due to French political concerns and the Swiss Central Bank may cut interest rates to limit the franc’s gains on the euro

Asian stock markets were in the red on Monday as mixed Chinese economic news highlighted the country’s difficult recovery, while political uncertainty in Europe dampened risk appetite and kept the euro on the defensive.

Oil prices decline due to weak US consumer demand and Chinese data, with Brent crude trading at $82.00 and West Texas Intermediate crude at $77.00.

This came after prices fell on Friday after a survey showed that US consumer sentiment fell to a seven-month low in June, with families concerned about their personal finances and inflation.

However, both benchmark contracts rose about 4% last week, the highest weekly percentage increase since April, on signs of increased fuel demand.

-Bitcoin price started another decline from the $66,850 resistance area. BTC is once again moving lower and may drop below the $65,500 support area.

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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: bearish

Time interval: half an hour (30 minutes)

Current price: 2319.32

The first scenario: selling gold at a break and holding below 2316.03, with a target price of 2309.58 and 2303.36.

Alternative scenario: Buy gold at a break and hold above 2327.41, with a target price of 2333.84 and then 2340.97.

Comment: Trading below resistances and averages suggests a decline

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CRUDE OIL

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: $77.64 per barrel

The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $78.13, targeting a price of $78.60, then 79.16. Alternative scenario: Selling oil at a break of $77.45, targeting a price of $76.93, then 76.34.

Comment: Trading above supports and averages suggests an upward trend

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EURUSD

 

General trend: bearish

Time interval: half an hour (30 minutes)

Current price: 1.07001

The first scenario: selling the euro/dollar at a break of 1.06910, targeting a price of 1.06750, then 1.06537.

Alternative scenario: Buy the Euro/Dollar at a break and hold steady by closing the candle above 1.07137, targeting the price of 1.07322 then 1.07546.

Comment: Trading below resistances and averages suggests a decline

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GBPUSD

 

Trend: down

Time interval: half an hour (30 minutes)

Current price: 1.26777

The first scenario: selling the pound dollar at a break and holding below the 1.26650 level, targeting the price of 1.26452 then 1.26228.

Alternative scenario: Buy the pound dollar at a break and hold firm by closing above 1.26986, targeting the price of 1.27272 then 1.27493.

Comment: Trading below resistances and averages suggests a decline

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NAS100

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 19965

The first scenario: Buy Nasdaq at a break and hold steady with a close above 20009, targeting a price of 20079 then 20159.

Alternative scenario: sell Nasdaq at a break and hold firm by closing below 19907, price of 19850, then 19799.

Comment: Trading above supports and averages suggests an upward trend

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Economic Calendar

 

(Times are in GMT+3)

Eid al-Adha holiday in most countries of the Islamic world

 

Fundamental Analysis

 

 

The dollar index held above 105.5 on Monday, hovering near its highest levels since early May, as the Federal Reserve’s updated forecast released last week pointed to just one rate cut this year, which could come in late December.

Minneapolis Fed President Neel Kashkari also confirmed that on Sunday, saying it was a “reasonable expectation” to expect one rate cut this year.

The forecast came on the heels of weaker-than-expected US inflation numbers for May, as investors eye retail sales and preliminary PMI numbers this week.

The dollar also benefited from the sharp decline in the value of the euro as political turmoil in Europe took its toll.

Elsewhere, China’s central bank kept the interest rate on its medium-term lending facility unchanged at 2.5%, while the Reserve Bank of Australia will decide monetary policy later this week.

Gold prices fell on Monday as investors awaited more US economic data, while reports last week showed inflation stabilizing and raised hopes that the Federal Reserve will cut interest rates later this year.

Oil prices fell in Asian trading on Monday after a survey on Friday showed weak US consumer demand and with crude production rising in May in China, the world’s largest crude importer.