Daily Market Analysis

 

 

Latest Economic and Fundamental Insights

 

The dollar index held onto its recent high of around 104.4 on Thursday, hovering near its highest level in nearly three months amid growing expectations that the Federal Reserve will be more cautious in cutting interest rates further and rising prospects of former President Donald Trump regaining the White House.

Gold rises after sharp decline

The decline was driven by the strength of the US dollar and the rise in Treasury yields, amid growing expectations that the Federal Reserve will adopt a cautious approach to monetary easing.

However, gold’s rally remains supported by its safe-haven status amid ongoing geopolitical tensions in the Middle East, with investors concerned about the potential for a wider conflict due to the ongoing heavy exchange of fire.

Moreover, uncertainty surrounding the upcoming US presidential election and monetary easing by major central banks provided further support.

Gold rose in early Asian morning trading on the back of a possible technical recovery. The metal settled down 1.1% on Wednesday, snapping a six-month winning streak.

The recent surge in gold prices comes amid heightened political uncertainty stemming from the upcoming US elections and narrowing poll results among candidates.

“This convergence in the polls could reduce bets on risky assets, which may be highly volatile after the results are announced, and at the same time, it could boost demand for safe assets.”

Asian stocks fell on Thursday, while the dollar remained near three-month highs and U.S. yields rose as uncertainty over the outcome of the U.S. election continued to keep markets on edge, although Tesla Inc.’s better-than-expected earnings provided some relief to investors.

Oil prices rise more than 1% amid concerns over Middle East tensions, with Brent crude trading at $75.00 and WTI at $71.00.

Oil prices have risen about 4% so far this week, helping to pare last week’s more than 7% loss on concerns about Chinese demand and easing worries about potential disruption from fighting in the Middle East.

“Oil price volatility is a combination of technical reactions to future uncertainty,” said Priyanka Sachdeva, senior market analyst at Philip Nova.

“With the lack of a supportive catalyst and with the emotions running high in the oil markets, the rise in oil prices at any additional headline about the escalation of the conflict in the Middle East seems entirely justified,” she added.

-Syrian state media said Israel launched strikes on the Syrian capital Damascus early Thursday, in the latest such attack amid the war in Gaza.

This came after previous Israeli strikes on Beirut’s southern suburbs on Wednesday and after Hezbollah said it had fired precision-guided missiles for the first time at Israeli targets.

The intense exchange of fire comes as Washington makes a last-ditch effort to broker peace between Israel and the Iran-backed Hezbollah and Hamas groups ahead of the Nov. 5 U.S. presidential election that could change U.S. policy in the Middle East.

Sachdeva of Philip Nova said the current volatility ahead of a crucial week ahead of the US election followed by a Fed policy decision has enough traction to cause more wild swings, although supply remains plentiful.

Meanwhile, U.S. crude inventories rose by 5.5 million barrels last week, the U.S. Energy Information Administration said on Wednesday, compared with analysts’ expectations in a Reuters poll for a 270,000-barrel increase.

-Bitcoin price tested the $65,200 area before the bulls came in. Bitcoin price is now rising and targeting further gains above the $67,500 resistance level.

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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: Upward

Time interval: half an hour (30 minutes)

Current price: 2726.84

Scenario 1: Buy gold with a break and stability above 2732.06, targeting 2738.23 and 2756.62

Alternative scenario: Sell gold with a break and stability below 2720.69, targeting 2714.23 and then 2706.39

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

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CRUDE OIL

 

Trend: Down

Interval: Half an hour (30 minutes)

Current price: $71.60 per barrel

Scenario 1: Buy oil by breaking the $71.80 level, targeting $72.72 and then $72.83.

Alternative scenario: Sell oil with a break and stability by closing a candle below the $71.12 levels, targeting $70.60 and then $70.01.

Comment: Trading below the resistances and averages suggests a decline.

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EURUSD

 

General trend: Down

Interval: Half an hour (30 minutes)

Current price: 1.07910

Scenario 1: Sell EUR/USD after breaking 1.07865, targeting 1.07705 and then 1.07492

Alternative scenario: Buy the EUR/USD with a break and hold with a candle closing above 1.08087, targeting 1.08277 and then 1.08501.

Comment: Trading below the resistances and averages suggests a decline.

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GBPUSD

 

Trend: Down

Interval: Half an hour (30 minutes)

Current price: 1.29270

Scenario 1: Selling the pound dollar with a break and stability below the 1.29064 level, targeting the price of 1.28824 and then 1.28602

Alternative scenario: Buy GBP/USD with a break and hold at a buy close of 1.29364 with a target price of 1.29605 then 1.29892

Comment: Trading below the resistances and averages suggests a decline.

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NAS100

 

Trend: Upward

Interval: Half an hour (30 minutes)

Current price: 20319

Scenario 1: Buy Nasdaq with a break and hold with a close above 20408, targeting 20512 then 20630

Alternative scenario: Sell Nasdaq with break and hold with close below 20521 with target price 20127 then 20020

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

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Economic Calendar

 

(Times are in GMT+3)

-From USA Unemployment Claims Rate 15:30
-From USA Manufacturing PMI (October) 16:45
-From USA Services PMI (October) 16:45
-From USA New Home Sales (September) 17:00

Fundamental Analysis

 

 

The dollar index held onto its recent gains to around 104.4 on Thursday, hovering near its highest in nearly three months amid growing expectations that the Federal Reserve will be more cautious in cutting interest rates further and rising prospects of former President Donald Trump regaining the White House.

The US dollar also received support from higher Treasury yields, with the benchmark 10-year Treasury yield hitting an intraday high of 4.26% on Wednesday.

The moves come as strong data on jobs, consumer inflation and retail sales in the United States indicated that the economy remains strong.

Fed Chair Schmid said this week he does not favor massive moves, while Harker has called for a more moderate approach to further easing.

On the political front, markets are betting on a likely Trump win in November, a bullish scenario for the dollar and Treasury yields given his inflationary policies such as higher tariffs and lower taxes.

The dollar rose to a three-month high against the yen and a four-month high against the euro.

Gold rose above $2,720 an ounce on Thursday in a possible technical rebound, after retreating from record highs with a more than 1% decline in the previous session.

Oil prices rose more than 1% on Thursday, nearly reversing the previous session’s losses, as tensions in the Middle East returned to focus ahead of the U.S. election despite mixed U.S. fuel inventories.