Daily Market Analysis

 

 

 

Latest Economic and Fundamental Insights

 

Dollar Index Stabilizes Around 105.6: The dollar index steadied around 105.6 on Wednesday after losing 0.4% in the previous session, weighed down by slowing US private sector growth that supports the case for Federal Reserve rate cuts.

Dollar Weakens on Strong European Data, Slowing US Business Growth: The dollar’s overnight losses were driven by a combination of surprisingly strong European activity data and slowing US business growth.

Australian Dollar Surges on Hotter-Than-Expected CPI Data: The Australian dollar took full advantage of the weaker US currency and rose in early Asian trading on Tuesday, supported by hotter-than-expected consumer price data.

CPI Report Reinforces Expectations of No Rushing by RBA: The inflation report reinforces expectations that the Reserve Bank of Australia (RBA) will not rush into monetary easing.

Focus on PCE Deflator: The key test for that will come on Friday with the release of the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures deflator. Markets are currently pricing in a 73% chance of the first rate cut by September, according to the CME Group’s FedWatch tool.

US Economy Remains Resilient, Upside Risks for Dollar: “The story is still that the US economy is very resilient, and as long as we have the US economy in that position – with the ability to raise federal funds rates further – the risks for the US dollar are still skewed to the upside,” said James Knighton, chief corporate FX dealer at Convera.

Gold Retreats as Middle East Fears Ease: Gold retreated as Middle East fears eased. “Gold has been a recipient of different types of buying flows in recent months, and now one of those flows has dried up a bit as safe-haven demand fades,” said Tim Waterer, senior market analyst at KCM Trade.

No Urgent Need for Rate Cuts, Say Fed Officials: Recent comments from Federal Reserve officials suggest no urgent need for rate cuts. Traders now expect the first Fed rate cut most likely in September.

Markets Await PCE Spending Data: Markets are awaiting March personal consumption expenditures (PCE) data – the Fed’s preferred inflation gauge – later this week for further confirmation on the path of monetary policy.

Asian Stocks Rise on Tech Boost, Yen in Focus for Intervention: Asian stocks rose on Tuesday, supported by a boost from technology shares, while the yen was closely watched for signs of intervention from Japanese authorities.

Nvidia Shares Jump 4%: Nvidia shares jumped 4% to erase some of the losses from their worst session in four years.

Visa Q2 Earnings Beat Expectations: Visa reported second-quarter earnings that beat expectations, sending its shares higher.

General Motors Shares Post Biggest Gains in 3 Months: General Motors shares posted their biggest gains in three months.

Tesla Earnings Miss Estimates: Tesla’s earnings missed estimates, sending its shares lower.

Oil Prices Rise on Unexpected Drop in US Crude Inventories: Oil prices rose after data showed an unexpected drop in US crude inventories. Brent crude is trading around $88.00 and West Texas Intermediate around $83.00.

US Crude Inventories Fall: US crude inventories fell by 3.237 million barrels in the week ended April 19, according to market sources citing American Petroleum Institute (API) figures. In contrast, six analysts polled by Reuters had forecast a rise of 800,000 barrels.

Expectations of Rate Cuts in UK, EU Grow: Expectations are growing that interest rates will be cut in the UK and the EU in June, which could help support economic growth and, in turn, oil demand.

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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: bullish

Time interval: half an hour (30 minutes)

Current price: 2327.16

The first scenario: Buy gold at a break and hold above 2330.773, with a target price of 2337.76 and 2344.05. Alternative scenario: Sell gold at a break and hold below 2319.35, with a price target of 2312.90 and then 2305.55.

Comment: Trading above supports and averages suggests an upward trend

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CRUDE OIL

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: $83.24 per barrel

The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $83.53, targeting a price of $84.00, then 84.56. Alternative scenario: Selling oil at a break of $82.85, targeting a price of $82.33, then 81.75.

Comment: Trading above the supports and averages suggests an upward trend

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EURUSD

 

General trend: – Bearish

Time interval: half an hour (30 minutes)

Current price: 1.07056

The first scenario: sell the euro/dollar at a break of 1.07002, targeting a price of 1.06842, then 1.06629. Alternative scenario: buy the euro/dollar at a break of 1.07229, targeting a price of 1.07414, then 1.07639.

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: 1.24551

The first scenario: selling the pound dollar at a fraction and holding below the level of 1.24397, targeting a price of 1.24199 then 1.23975. Alternative scenario: buying the pound dollar at a breaking point and holding steady at a close above 1.24733, targeting a price of 1.25019 then 1.25240.

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: 17730

The first scenario: Buying the Nasdaq at a break and holding steady with a close above 17802, targeting the price of 17872 then 17969. Alternative scenario: Selling the Nasdaq at a break and holding steady with a close below 17678 with a price of 17617 then 17547.

Trading above the supports and averages suggests an upward trend

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Economic Calendar

 

(Times are in GMT+3)

US Crude Oil Inventories 5:30 PM EDT

 

Fundamental Analysis

 

 

The dollar index settled around 105.6 after losing 0.4% in the previous session, pressured by slowing US private sector growth.

Data revealed a slowdown in US business activity, indicating only slight expansion in April as manufacturing and services activities dipped.

The dollar faced additional pressure from resurgent euro and sterling, buoyed by strong business activity data in the eurozone and the UK, respectively.

The US dollar also retreated against the Australian dollar as stronger-than-expected Australian inflation data fueled expectations that the Reserve Bank of Australia (RBA) will hold off on interest rate cuts.

Investors now turn their attention to key US economic data releases this week:

• US GDP (Thursday): The first quarter of 2024 US GDP growth figures will be released on Thursday.
• PCE Price Index (Friday): The Fed’s preferred inflation gauge, the personal consumption expenditures (PCE) price index, will be released on Friday.

Gold prices fell on Wednesday as concerns about a wider Middle East conflict subsided. Reports indicated Iran had no plans to retaliate for a recent Israeli drone strike.

Oil prices rose in early trading on Wednesday, extending gains from the previous session. This strength stemmed from data showing a surprising decline in US crude oil inventories last week.