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Gold Price Holds Gains Around $2,670, Supported by Softer Risk Sentiment

Gold Price Holds Gains Around $2,670, Supported by Softer Risk Sentiment

Gold Price Holds Gains Around $2,670, Supported by Softer Risk Sentiment

Gold (XAU/USD) continues to edge higher for the second consecutive day on Wednesday, extending its recent positive streak, reaching a one-and-a-half-week high around $2,670 during the Asian session. The ongoing geopolitical tensions in the Middle East are fueling a risk-off sentiment, which is providing support to the safe-haven appeal of gold.

Meanwhile, the US Dollar (USD) is consolidating near a two-month peak, offering limited movement in the gold market. However, growing expectations that the Federal Reserve (Fed) will ease its monetary policy less aggressively, with a likely 25 basis point rate cut in November, are keeping any major USD decline in check. This calls for caution before making aggressive bullish bets on the non-yielding precious metal.

Market Movers: Gold Underpinned by Multiple Factors, Lacks Strong Bullish Momentum

US Treasury bond yields fell for the second straight day on Tuesday, as weaker-than-expected manufacturing data and easing inflation concerns, aided by lower oil prices, boosted demand for gold. The New York Fed’s Empire State Manufacturing Index, which surged to a 29-month high in September, fell sharply to -11.9 in October, the weakest level since May, signaling worsening economic conditions.

Falling oil prices, due to lower supply disruption fears and weaker demand prospects, further ease inflationary pressures, creating room for the Fed to cut interest rates. However, markets are pricing in a higher chance of a smaller rate cut at the next FOMC meeting in November, which could strengthen the US Dollar and limit gold’s upside potential.

San Francisco Fed President Mary Daly remarked that significant progress has been made in controlling inflation, and she anticipates one or two more rate cuts this year if the economic outlook remains on track. Similarly, Atlanta Fed President Raphael Bostic commented that the US economy is performing well and recession risks remain low, with inflation expected to return to the Fed’s 2% target.

On the geopolitical front, Israeli Prime Minister Benjamin Netanyahu rejected calls for a ceasefire with Lebanon, while Hezbollah threatened to escalate its attacks, increasing the risk of a broader conflict. The Biden administration has urged Israel to allow more humanitarian aid into Gaza, warning of potential consequences, including halting US arms transfers.

This week, market attention will shift to key US economic data releases, including Monthly Retail Sales, Industrial Production, and Weekly Initial Jobless Claims, as well as China’s economic reports.

Technical Outlook: Gold Nears All-Time High, Bullish Potential Intact

Technically, gold’s next resistance is expected around the $2,685-$2,686 level, close to the all-time high reached in September. A decisive break above the $2,700 psychological level could pave the way for further gains, extending the multi-month uptrend supported by positive momentum indicators on the daily chart.

On the downside, immediate support lies near the $2,650 area, with the next key level around $2,630-$2,632. A further decline could attract buyers near the $2,600 level, which serves as a crucial pivot. A decisive break below this level might trigger technical selling and lead to deeper losses for gold.

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Japanese Yen Vulnerable Against USD, Hovers Near Lowest Levels Since Early August

Japanese Yen Vulnerable Against USD, Hovers Near Lowest Levels Since Early August

The Japanese Yen (JPY) continues to struggle, failing to hold onto modest gains from the Asian session against the US Dollar (USD), and remains near its lowest point since early August, touched on Monday. Investors are scaling back their expectations for further interest rate hikes by the Bank of Japan (BoJ) in 2024. This, combined with the prevailing risk-on sentiment in the markets, has diminished demand for the safe-haven JPY.

At the same time, expectations for a less aggressive monetary easing approach from the Federal Reserve (Fed) and predictions of a standard 25 basis point rate cut in November are keeping US Treasury yields elevated. This supports the USD, which hovers near a two-month high, limiting any gains for the lower-yielding JPY and pushing the USD/JPY pair back towards the 150.00 psychological level in the latest trading.

Market Highlights: Yen Struggles Amid Elevated US Bond Yields and Risk-On Sentiment

  • Japanese Prime Minister Shigeru Ishiba’s recent comments have dampened market expectations for further BoJ rate hikes in the near term.
  • US equity markets maintained their upward momentum on Monday, with the S&P 500 and Dow Jones Industrial Average reaching record highs amid optimism over strong corporate earnings.
  • The USD has strengthened significantly over the past two weeks, reaching its highest level since August 8 due to bets on smaller Fed rate cuts.
  • Minneapolis Fed President Neel Kashkari indicated that recent job data shows the labor market remains resilient, with future policy moves being data-dependent.
  • Fed Governor Christopher Waller suggested the central bank should proceed cautiously with rate cuts, especially in light of recent policy meetings.
  • According to the CME Group’s FedWatch Tool, markets are pricing in a strong likelihood of a 25 basis point rate cut in November, with over a 15% chance of no cut.
  • Rising US bond yields, particularly the 10-year Treasury yield, which recently exceeded the 4% mark, favor the USD and continue to pressure the low-yielding JPY.

Traders are now looking to the release of the Empire State Manufacturing Index and speeches from key Federal Open Market Committee (FOMC) members for further direction.

Technical Outlook: USD/JPY Approaching Key Levels

From a technical standpoint, any further decline in USD/JPY is expected to attract buying interest around the 149.00 level. This should help limit downside moves near the 148.55-148.50 support zone. A break below this area could lead to increased selling pressure, pushing the pair below the 148.00 mark and potentially toward last week’s low around 147.35-147.30.

On the upside, sustained strength above the key psychological level of 150.00 could trigger fresh buying interest. With daily chart oscillators holding in positive territory and not yet overbought, the USD/JPY pair could aim for the August swing high around 150.85-150.90. A move beyond 151.00 would suggest the pair has bottomed out, paving the way for further appreciation in the near term.

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Japanese Yen Consolidates Against USD | Near Lowest Level Since Early August

Japanese Yen Consolidates Against USD, Hovers Near Lowest Level Since Early August

Japanese Yen Consolidates Against USD, Hovers Near Lowest Level Since Early August

The Japanese Yen (JPY) continues its sideways consolidation against the US Dollar (USD), remaining near its lowest level since early August during Monday’s early European session. Comments from Japanese Prime Minister Shigeru Ishiba last week, which were critical of further monetary tightening, have dampened expectations for additional rate hikes by the Bank of Japan (BoJ). This, combined with a generally positive risk sentiment in global markets, has weakened demand for the safe-haven JPY.

Meanwhile, the USD holds steady near a two-month high reached last week, supported by expectations of less aggressive policy easing from the Federal Reserve (Fed). However, despite the strong USD, the Fed is still anticipated to lower interest rates by 25 basis points in November, contrasting with the BoJ’s likely continuation of its rate-hiking cycle. This divergence in policy is preventing traders from making fresh bullish bets on the USD/JPY pair.

Market Sentiment: Yen Traders Hesitate Amid Mixed Signals

The futures market indicates less than a 50% chance that the BoJ will raise rates by 10 basis points before year-end, following Prime Minister Ishiba’s dovish tone in early October. Additionally, Japan’s economic data, including a drop in real wages for the first time in three months and declining household spending, along with easing price pressures from raw material costs, raises doubts about how aggressively the BoJ will pursue further rate hikes.

Meanwhile, China’s finance ministry signaled potential increased debt issuance to support its domestic economy, but provided few details about stimulus plans. Despite this, investors remain optimistic that comprehensive measures will be introduced to stabilize key sectors, buoyed by the recent rally in US equity markets, which hit record highs last Friday.

In the US, September’s Producer Price Index (PPI) data revealed a 1.8% rise in the headline figure and a 2.8% increase in the core measure on a yearly basis, both slightly exceeding expectations. Combined with last week’s hotter-than-expected US consumer inflation data, this has reduced the likelihood of another large rate cut by the Fed in November, strengthening the USD. That said, the Fed is still expected to continue lowering rates due to signs of labor market weakness, while the BoJ remains on course to hike rates again by year-end, which limits the upside for the USD/JPY pair.

Technical Outlook: USD/JPY Positive Bias Holds Above 148.00

From a technical perspective, the USD/JPY pair recently broke through its 50-day Simple Moving Average (SMA) for the first time since mid-July and climbed above the 38.2% Fibonacci retracement level of its July-September decline. This breakout, along with positive signals from daily chart oscillators, suggests that the pair’s path of least resistance is to the upside. A move above last week’s high around the 149.55-149.60 region would confirm the bullish bias, potentially pushing prices towards the 150.00 psychological level, and possibly extending towards the 50% Fibonacci level near 150.75-150.80.

On the downside, any significant dip below the 149.00 mark is likely to attract buying interest around the 148.55 region, which should limit losses near 148.00. A decisive break below this level could trigger technical selling, dragging the pair toward intermediate support at 147.35 and potentially down to 147.00 or 146.50.

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Gold Price Holds Gains as USD Strength Limits Upside Ahead of US PPI Data

Gold Price Holds Intraday Gains, But USD Strength Limits Upside Ahead of US PPI Data

Gold Price Holds Intraday Gains, But USD Strength Limits Upside Ahead of US PPI Data

Gold (XAU/USD) has retreated slightly from a three-day high, trading around the $2,640 level during early European hours on Friday. Despite the dip, the precious metal remains up over 0.40% for the day. A rise in U.S. weekly jobless claims signals some weakness in the labor market, which could allow the Federal Reserve (Fed) to continue cutting interest rates. This has led to a modest drop in U.S. Treasury yields and a softer risk sentiment, supporting gold prices for the second consecutive day.

However, stronger-than-expected U.S. consumer inflation data on Thursday reduced expectations of a significant rate cut by the Fed in November. This has supported the U.S. dollar, halting its recent pullback and creating headwinds for gold’s upward momentum. Traders are now focusing on the upcoming U.S. Producer Price Index (PPI), along with the Preliminary Michigan Consumer Sentiment Index and inflation expectations, for short-term direction.

Key Market Drivers: Gold Holds Steady Ahead of US PPI

  • US Inflation Data: The Labor Department reported on Thursday that the headline Consumer Price Index rose 2.4% year-over-year through September, while core inflation, excluding food and energy, climbed 3.3%. This stronger inflation data fueled speculation that the Fed will slow the pace of future rate cuts, boosting the U.S. dollar to near two-month highs, though the initial reaction faded.
  • Labor Market Weakness: U.S. weekly jobless claims rose by 33,000 to a seasonally adjusted 258,000, higher than the 230,000 expected, indicating some softening in the labor market. As the Fed shifts focus toward maximum sustainable employment, this mixed data suggests continued rate cuts, potentially supporting gold prices.
  • Treasury Yields and USD Strength: Despite the jobless claims data, the 10-year U.S. Treasury yield remains above 4%, bolstering the U.S. dollar and capping further gains for gold.
  • China’s Stimulus Measures: China’s finance ministry is expected to release details of fiscal stimulus measures, which could support risk sentiment and limit any significant upside for gold in the short term.

Looking ahead, traders will be closely watching the release of the U.S. PPI data, which is expected to impact USD demand and create trading opportunities for gold heading into the weekend.

Technical Outlook: Gold Poised for Further Gains

From a technical perspective, the recent rebound from near the $2,600 level and the move above the $2,630 support-turned-resistance zone favor bullish traders. The daily chart oscillators remain in positive territory, suggesting that gold may continue to rise toward the $2,657-$2,658 resistance area, with the $2,670-$2,672 supply zone as the next target. If momentum continues, gold could test its all-time high around $2,685-$2,686, with the $2,700 level serving as a key psychological resistance.

On the downside, the $2,630-$2,628 region now acts as immediate support, with a break below this level potentially opening the door for a test of the pivotal $2,600 mark. A sustained drop below $2,600 could trigger deeper losses, with the next key support at $2,560, followed by $2,535-$2,530, and eventually $2,500.

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Gold Price Recovers from Multi-Week Low, but Upside Potential Remains Limited Ahead of US CPI

Gold Price Recovers from Multi-Week Low, but Upside Potential Remains Limited Ahead of US CPI

Gold Price Recovers from Multi-Week Low, but Upside Potential Remains Limited Ahead of US CPI

Gold (XAU/USD) is experiencing a modest rebound on Thursday, recovering from a six-day losing streak that pushed prices to a near three-week low, around the $2,605-$2,604 range. This intraday uptick is likely due to repositioning ahead of the crucial US Consumer Price Index (CPI) report, which could shape expectations about the Federal Reserve’s (Fed) rate cut decisions and impact demand for the non-yielding metal.

At the same time, widespread market belief that the Fed will lower rates by 25 basis points in November has kept the 10-year U.S. Treasury yield above the 4% mark, boosting the U.S. Dollar (USD) to an eight-week high. This is a headwind for gold, which may limit any substantial upside. Traders are cautious, waiting for a stronger follow-through in the market before assuming that the recent corrective decline from gold’s all-time peak has concluded.

Market Factors Limiting Gold’s Upside: Strong USD and Moderate Fed Easing

The minutes from the September Federal Open Market Committee (FOMC) meeting showed a majority favored a 50 bps rate cut, confident in achieving a 2% inflation target. Some committee members, however, pushed for only a 25 bps reduction, citing still-elevated inflation and strong economic growth. There was a consensus that this large cut would not determine the pace of future reductions, which helped push the USD to a two-month high.

Additionally, key Fed officials expressed a more cautious stance on aggressive easing. Dallas Fed President Lorie Logan mentioned uncertainties in the economic outlook, while Boston Fed President Susan Collins emphasized that policy will remain data-driven. San Francisco Fed President Mary Daly hinted at more rate cuts but noted that the September decision does not indicate the size of future cuts.

Current market pricing shows a greater likelihood of a 25 bps rate cut in November and a more than 20% chance that rates will be left unchanged.

Safe-Haven Demand Supports Gold Amid Geopolitical Risks

Geopolitical tensions, particularly between Israel and Iran, are contributing to safe-haven demand for gold. Israeli Defense Minister Yoav Gallant recently warned of a potential strike against Iran, which could increase market volatility and lend further support to gold. However, traders are likely holding off on aggressive positioning until after the release of the US inflation data.

Technical Outlook: Bearish Bias with Limited Upside

From a technical perspective, the recent breakdown below the $2,630 support level signals a bearish outlook for gold. The daily chart oscillators remain in positive territory, but the metal has yet to sustain a break below the critical $2,600 level, making traders cautious about deeper losses.

If the price decisively breaks below $2,600, the next support levels to watch are $2,560, followed by the $2,535-$2,530 zone, with the $2,500 psychological level acting as a major downside target.

On the flip side, the $2,630-$2,635 range now serves as an immediate resistance level. Any upward movement is expected to face selling pressure around the $2,657-$2,658 barrier, with a sustained rally above this level possibly pushing gold toward the $2,670-$2,672 zone. A move beyond this point could challenge the all-time high near $2,685-$2,686, with a break above $2,700 setting the stage for further gains in the long-term uptrend.

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New Zealand Dollar Hits Seven-Week Low After RBNZ Cuts Interest Rate by 50 bps

New Zealand Dollar Hits Seven-Week Low After RBNZ Cuts Interest Rate by 50 bps

New Zealand Dollar Hits Seven-Week Low After RBNZ Cuts Interest Rate by 50 bps

The New Zealand Dollar (NZD) has dropped to its lowest level since mid-August, following the Reserve Bank of New Zealand’s (RBNZ) decision to cut the Official Cash Rate (OCR) by 50 basis points, lowering it from 5.25% to 4.75% at the October meeting. As anticipated, the move led to immediate selling pressure on the Kiwi. Additionally, the lack of new stimulus measures from Chinese officials has added to the NZD’s decline, as China remains a major trading partner for New Zealand.

Looking ahead, market participants will focus on the Federal Open Market Committee (FOMC) Minutes release later on Wednesday, followed by Thursday’s US Consumer Price Index (CPI) data for September. If inflation comes in softer than expected, it could weigh on the USD and provide some relief for the NZD/USD pair.

Market Movers: New Zealand Dollar Remains Weak Post-RBNZ Decision

The RBNZ’s Monetary Policy Statement (MPS) indicated that the annual consumer price inflation is within the target range of 1-3%. The decision to cut the OCR by 50 basis points aims to maintain low and stable inflation while avoiding instability in output, employment, interest rates, and exchange rates.

In the US, Federal Reserve Vice Chair Philip Jefferson noted that the Fed’s September 50 bps rate cut aimed to support the labor market while inflation eases. However, despite progress, inflation has not yet met target levels, according to Atlanta Fed President Raphael Bostic. New York Fed President John Williams also backed the recent rate cuts, signaling the possibility of additional cuts later this year.

Technical Analysis: NZD/USD Faces Downward Pressure

The New Zealand Dollar remains under pressure, continuing its downtrend against the US Dollar. The pair has fallen below the key 100-day Exponential Moving Average (EMA) and is nearing a break below the ascending trend channel on the daily chart. This bearish momentum is supported by the 14-day Relative Strength Index (RSI), which is sitting below the midline at 41.10, favoring sellers in the short term.

A decisive break below the lower boundary of the trend channel at 0.6135 could open the door to the 0.6000 psychological level. If the pair sustains trading below this level, it could test 0.5974, the low from August 15.

On the upside, immediate resistance is seen at the 100-day EMA, around 0.6142. If the NZD/USD pair can push higher, it may target 0.6254, the high from September 6. Further gains could aim for the round figure of 0.6300, with the upper limit of the trend channel at 0.6365.

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Australian Dollar Slips as China Holds Back on Major Stimulus Measures

Australian Dollar Slips as China Holds Back on Major Stimulus Measures

Australian Dollar Slips as China Holds Back on Major Stimulus Measures

The Australian Dollar (AUD) extended its decline on Tuesday, pressured by comments from the National Development and Reform Commission (NDRC) of China. During a press conference, China’s state planner acknowledged that the country’s economy is facing increasingly complex internal and external challenges. The lack of additional major stimulus from Chinese officials disappointed traders. Furthermore, the broader risk-off sentiment, fueled by escalating geopolitical tensions in the Middle East, contributed to selling pressure on risk-sensitive assets like the AUD.

Despite the downward movement, the Australian Dollar’s losses could be limited due to the Reserve Bank of Australia’s (RBA) hawkish stance, as reflected in the September Meeting Minutes. Investors now await remarks from Federal Reserve officials later on Tuesday, looking for guidance ahead of the Federal Open Market Committee (FOMC) Minutes. The focus will shift to the release of the US Consumer Price Index (CPI) for September, due on Thursday, for further clues on the US economic outlook.

Daily Market Movers: Australian Dollar Loses Ground After China’s NDRC Conference

The RBA’s September Meeting Minutes, released on Tuesday, revealed discussions among board members on possible future rate adjustments. The minutes emphasized that policy would need to remain restrictive until inflation is consistently moving toward the target range. RBA Deputy Governor Andrew Hauser stated that lowering inflation remains a priority, and the task is not yet complete.

Meanwhile, in the US, St. Louis Fed President Alberto Musalem expressed support for additional interest rate cuts, noting that economic performance will shape monetary policy. Similarly, Minneapolis Fed President Neel Kashkari backed a 50-basis-point rate cut, highlighting that the risks have shifted from high inflation toward higher unemployment. According to the CME FedWatch Tool, the probability of a 25-basis-point Fed rate cut in November has surged to 85%, up from 31.1% last week.

Technical Analysis: AUD/USD Remains Bullish in the Long Term

Despite recent setbacks, the AUD/USD pair is attempting a rebound. On the daily chart, the pair remains within the lower boundary of its ascending trend channel, maintaining a bullish bias as it stays supported above the 100-day Exponential Moving Average (EMA). However, the 14-day Relative Strength Index (RSI) is below the midline at 47.0, suggesting potential for further consolidation or downside movement.

Initial support for the AUD/USD pair lies at 0.6735, the lower limit of the trend channel. A break below this level could trigger bearish momentum, pushing the pair toward the psychological level of 0.6700, with further downside potential at 0.6622, the low of September 11.

On the upside, resistance is first seen at 0.6823, the high from August 29. If the pair extends its gains, it could target 0.6942, the high from September 30. A decisive break above this level could attract more buyers, lifting AUD/USD toward the upper boundary of the trend channel at 0.6980.

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The Dow futures remained unchanged, but Zoom witnessed a notable 17.1% drop

The Dow futures remained unchanged, but Zoom witnessed a notable 17.1% drop

During Monday’s evening trading, U.S. stock futures experienced minimal movement, remaining within a narrow range, following moderate gains in major benchmark averages. Investors were focused on upcoming quarterly earnings reports scheduled for the week. By 7:15 pm ET (11:15 pm GMT), Dow Jones Futures, S&P 500 Futures, and Nasdaq 100 Futures were all trading flat.

In after-hours trading, ZoomInfo Technologies Inc (NASDAQ: ZI) saw a significant dip of 17.1% after reporting its Q2 earnings. The company’s earnings per share (EPS) came in at $0.26, slightly higher than the expected $0.23, while its revenues reached $308.6 million, slightly below the anticipated $310.94 million.

Similarly, Yum China Holdings Inc (NYSE: YUMC) experienced a decline of 2.8% following its Q2 earnings release. The company reported an EPS of $0.47, slightly surpassing the expected $0.46, but its revenues were $2.65 billion, falling short of the projected $2.72 billion.

Harmonic (NASDAQ: HLIT) also faced a significant drop of 13.7% after reporting Q2 earnings. The company’s EPS was $0.12, missing the expected $0.13, and its revenues were $156 million, lower than the expected $167.52 million.

In contrast, Arista Networks (NYSE: ANET) witnessed a substantial increase of 14% following its Q2 earnings announcement. The company reported an EPS of $1.58, surpassing the expected $1.44, and its revenues were $1.46 billion, higher than the expected $1.38 billion.

Looking ahead to Tuesday’s trading session, market participants will closely monitor the release of Markit and ISM manufacturing PMIs and JOLTs job openings data. Additionally, several prominent companies, including Pfizer Inc (NYSE: PFE), Advanced Micro Devices Inc (NASDAQ: AMD), Starbucks Corporation (NASDAQ: SBUX), and Uber Technologies Inc (NYSE: UBER), will be reporting their quarterly earnings.

During Monday’s regular trading hours, the Dow Jones Industrial Average increased by 100.2 points or 0.3% to reach 35,559.5. The S&P 500 also gained 6.7 points or 0.2%, reaching 4,589, and the NASDAQ Composite rose by 29.4 points or 0.2% to reach 14,346.

On the bond markets, the United States 10-Year rates were at 3.965%. Investors will keep a close eye on economic data and corporate earnings to gauge the market’s direction in the upcoming trading sessions.

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US Dollar Stabilizes After Recent Losses

U.S. Stocks Rise as Market Awaits Fed Decision

U.S. Stocks Rise as Market Awaits Fed Decision

On Tuesday, the U.S. stock market experienced a positive swing, with investors closely watching earnings reports and eagerly anticipating the outcome of the U.S. Federal Reserve’s interest rate decision.

The Dow Jones Industrial Average, one of the key indices in the stock market, ended the day with a marginal increase of 0.1 percent, settling at 35,437.93 points. This marked the twelfth straight day of gains for the index. Meanwhile, the broader S&P 500 Index rose by 0.3 percent to reach 4,567.54, and the tech-focused Nasdaq Composite Index saw an increase of 0.6 percent, closing at 14,144.56.

Several companies released their earnings reports, which resulted in a mixed response on Wall Street. Shares of General Electric, Sherwin-Williams, and 3M saw substantial increases following their respective earnings announcements. Conversely, despite raising its full-year guidance, General Motors experienced a drop in share value.

In other corporate news, shipping giant UPS saw its shares dip by 1.9 percent after it reached a tentative five-year contract agreement with the Teamsters union. The agreement helped avert a potentially devastating nationwide strike. However, despite avoiding a disruptive strike, Steve Sosnick from Interactive Brokers suggested that UPS’s costs would likely increase as a result of the agreement.

Investors also kept a close eye on Alphabet, Google’s parent company, and Microsoft, both due to release their earnings reports after the market closed. The anticipation surrounding these tech giants’ earnings reports added an extra layer of suspense to the day’s trading activities on Wall Street.

However, the main focus for investors remained the impending decision by the U.S. central bank on interest rates. The decision is due at the end of a two-day policy meeting on Wednesday. The central bank is widely expected to raise interest rates for the eleventh consecutive time. Market participants are keen to glean any signs of further increases beyond this.

According to Peter Cardillo of Spartan Capital, the market is already factoring in a hike of 25 basis points. He further speculated that there might be indications that the central bank is nearing the end of its monetary tightening cycle.

In global economic news, the International Monetary Fund (IMF) slightly upgraded its outlook for global growth this year on Tuesday. This provided a glimmer of hope amid the prevailing economic uncertainties.

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Optimism in Asian Stock Markets as Fed, ECB, and BoJ Meetings Loom; China’s Performance Lags Despite Stimulus Hopes

Optimism in Asian Stock Markets as Fed, ECB, and BoJ Meetings Loom; China’s Performance Lags Despite Stimulus Hopes

Asian stock markets experienced a mixed start to the week, with Japan’s Nikkei 225 emerging as the top performer, soaring by nearly 1.5% fueled by robust quarterly earnings from major automotive manufacturers. The overall Japanese market sentiment also received a boost from expectations that the Bank of Japan (BoJ) would maintain its ultra-dovish stance during the forthcoming two-day policy meeting set to conclude on Friday.

In contrast, Chinese stocks struggled to keep pace with their regional counterparts due to mounting concerns over a real estate sector debt crunch and fears of a slowdown in economic growth. The Hang Seng in Hong Kong experienced a significant drop of over 1%, ranking among the weakest performers on the first trading day of the week. However, there are hopes that China will implement additional stimulus measures to mitigate potential losses.

In line with these expectations, China’s National Development and Reform Commission (NDRC) revealed new measures aimed at encouraging and supporting private investments in specific infrastructure sectors. The NDRC also pledged to provide enhanced financial backing for private projects, although the exact details are yet to be disclosed. Despite these efforts, the market sentiment remained cautious and failed to see a substantial lift.

Investors across the region appeared to be exercising caution and adopting a wait-and-see approach ahead of key central bank events scheduled for the week. The Federal Reserve (Fed) is set to announce its monetary policy decision on Wednesday following a two-day meeting, and a 25 basis points interest rate hike is widely anticipated. However, there are doubts among market participants regarding the extent of the Fed’s commitment to a more dovish policy stance.

Attention will be closely focused on the accompanying policy statement and the post-meeting press conference, where Fed Chair Jerome Powell’s remarks could provide valuable insights into the central bank’s future plans. Subsequently, the European Central Bank (ECB) meeting on Thursday and the Bank of Japan’s (BoJ) policy update on Friday will be key events to watch.

Meanwhile, traders on Monday were keenly awaiting the release of flash PMI prints from the Euro Zone, the UK, and the US, hoping for valuable cues to drive market momentum.

Overall, the Asian stock markets are facing a delicate balancing act, with some countries experiencing positive economic indicators and strong corporate earnings, while others grapple with uncertainties and the need for further stimulus measures. Investors are treading cautiously, recognizing the potential impact that central bank decisions and economic data releases can have on the regional and global financial landscape. As the week unfolds, market participants will closely analyze every development to make informed decisions in this dynamic and ever-changing market environment.

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GBP/USD Drops Below 1.2500 on Dovish BoE Outlook and Trump Tariff Moves

Asian markets mixed as Japan reports weak trade data

Asian markets mixed as Japan reports weak trade data

Asian markets exhibited a varied performance in response to Japan’s disclosure of disappointing trade data for June. The revelation of a nearly 13% decline in imports from the previous year resulted in an unexpected trade surplus for Japan, primarily attributed to the reduction in oil prices. This news had a mixed impact across Asian markets, with share prices rising in Sydney and Hong Kong, but declining in Shanghai, Tokyo, and Seoul. In addition, U.S. futures experienced a slight dip, while oil prices remained relatively stable.

While Asian markets showed divergence, Wall Street continued its bullish trend as positive profit reports from major U.S. companies bolstered investor confidence. However, gains on the Nasdaq were somewhat tempered due to weaker-than-anticipated results from streaming giant Netflix and electric vehicle manufacturer Tesla, triggering caution among Asian investors.

In the U.S., the S&P 500 rose by 0.2%, reaching its highest level in over 15 months, while the Dow Jones Industrial Average saw a gain of 0.3%. One of the standout performers was Elevance Health, which reported robust profits and revenue for the spring, surpassing analysts’ expectations. Similarly, U.S. Bancorp, M&T Bank, and Goldman Sachs posted positive results, contributing to the overall market upswing.

In the commodities market, wheat prices experienced a sharp surge following Russia’s attacks on critical port infrastructure in Ukraine, resulting in the destruction of 60,000 tons of grain. The sudden spike in wheat prices was driven by concerns over potential disruptions to grain exports from Ukraine, raising global food security apprehensions.

As the earnings reporting season gains momentum, analysts are projecting a third consecutive quarter of weaker earnings per share for S&P 500 companies. However, the relatively low expectations provide companies with an opportunity to outperform and surprise the market positively.

In the currency market, the U.S. dollar depreciated slightly against the Japanese yen, while the euro displayed a marginal increase against the dollar. These currency movements reflect ongoing fluctuations in foreign exchange markets, influenced by various economic indicators and geopolitical developments.

Amidst these market dynamics, investors remain vigilant of further trade data releases and earnings reports, which have the potential to significantly influence market sentiment and impact future performance in the Asian markets. Market participants will carefully assess economic indicators and corporate results to gain insights into the trajectory of the global economy and the investment landscape. As uncertainties persist in the aftermath of the pandemic and geopolitical tensions, investors seek to navigate an ever-changing and complex market environment, making informed decisions to manage risks and identify potential opportunities.

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Asian Stock Traders Tread Cautiously Ahead of US Retail Sales Data

Asian Stock Traders Tread Cautiously Ahead of US Retail Sales Data

As Tuesday unfolded, Asian stock traders navigated the markets with caution, displaying a predominantly negative sentiment across the region. One prevailing concern on their minds was China’s economic outlook, which cast shadows of uncertainty on the trading floors. Adding to their apprehension was the imminent release of crucial U.S. data, especially the highly anticipated Retail Sales and Industrial Production figures for June. The impending data release fueled a sense of cautious anticipation, as the market eagerly awaited insights into the health of the world’s largest economy and its potential implications for global markets.

Despite the prevailing market sentiment, Japanese traders managed to defy the regional trend, with their return from a holiday marking a slight upswing in the NIKKEI index, which gained 0.23%. However, other parts of Asia did not share in this mild success. Hong Kong’s Hang Seng index experienced a significant decline of 1.85%, while China’s Shanghai Composite Index slipped marginally by 0.06%. South Korea’s KOSPI index also followed the downward trend, losing 0.5%, further adding to the cautious atmosphere.

Interestingly, amid the cautious sentiment, the Bank of Japan (BoJ) took a counterintuitive stance by maintaining its easy-money policy. This decision surprised many, as market participants had anticipated a potential departure from ultra-low interest rates and a toning down of its Yield Curve Control (YCC) policy. However, the BoJ’s steadfastness underscored its commitment to supporting the Japanese economy amid the prevailing global economic challenges.

Geopolitical developments also grabbed the attention of investors. U.S. Climate Envoy John Kerry’s optimistic remarks about future cooperation with China during a dialogue with China’s top diplomat, Wang Yi, were closely monitored. Any shifts in U.S.-China relations could significantly influence market dynamics and risk sentiment, making this a crucial factor for traders to watch closely in the days ahead.

Additionally, the latest economic indicators from China added to the market’s unease. The disclosure of an annual GDP growth rate of 6.3% fell short of the projected 7.3% and was lower than the previous figure of 4.5%. Despite this, year-on-year Industrial Production showed a more positive side, rising to 4.4% from the previous 3.5%, surpassing the consensus estimate of 2.7%. These mixed economic signals from China further contributed to the cautious mood on the trading floors.

As the trading week progressed, market players eagerly awaited upcoming data releases that could influence the market’s direction. Among these are Japan’s Trade Balance and National Core CPI YoY, which may provide insights into the health of the Japanese economy. However, the most significant event on their radar was the release of U.S. Retail Sales data for June, expected to increase by 0.5% compared to the previous month’s 0.3%. This data release could have substantial implications for USD dynamics and possibly hint at the trajectory of the ongoing rate hike cycle. Consequently, traders kept a close eye on the performance of assets like Gold, equities, and AUDUSD, which could be significantly influenced by these developments in the global financial markets.

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Market Optimism Rises as Asian Shares Rally and Dollar Slumps on Fed’s Potential End to Rate Hikes

Market Optimism Rises as Asian Shares Rally and Dollar Slumps on Fed’s Potential End to Rate Hikes

On Thursday, Asian shares and bonds enjoyed a rally, while the dollar faced significant losses. This shift in the market sentiment was fueled by lower-than-expected U.S. inflation figures, leading to the belief that the Federal Reserve may be nearing the end of its tightening cycle post-pandemic. In contrast, European stocks had a cautious start, with EUROSTOXX 50 futures holding steady, while S&P 500 and Nasdaq futures showed minimal movement.

Despite China reporting disappointing trade data, indicating a higher-than-anticipated decline in both exports and imports last month, Asian investors maintained their optimism. They wagered that this setback would prompt further stimulus measures. The MSCI’s broadest index of Asia-Pacific shares outside Japan surged by 1.8%, with Hong Kong’s Hang Seng index soaring 2.6% and Australia’s resource-heavy shares gaining 1.7%. Japan’s Nikkei also experienced a rise of 1.5%.

Chinese tech giants listed in Hong Kong witnessed a 3.5% rally after Premier Li Qiang encouraged their support in bolstering the slowing economy. This move adds to indications that the sector’s years-long crackdown has come to an end.

The latest U.S. consumer inflation report delivered more positive news than expected. The Consumer Price Index (CPI) showed a year-on-year increase of 3% in June, falling slightly short of the anticipated 3.1% gain. This figure is significantly lower than last year’s 9.1% for the same period. Furthermore, core inflation, which had concerned the Fed, displayed a sharper deceleration than anticipated.

However, futures still suggest a 94% probability of a quarter-point hike from the Fed later this month. Yet, the likelihood of an additional hike in September has decreased to 13.2%, down from the previous day’s 22.3%. Futures now indicate an earlier first rate cut in March next year and anticipate a total of 125 basis points in cuts by 2024.

Following last week’s sell-off, bonds rebounded, resulting in a decline in global yields. The U.S. dollar reached a new 15-month low, easing pressure on emerging market currencies and granting Asian policymakers greater flexibility to implement monetary policy adjustments.

Meanwhile, the euro reached a new 15-month high, and the Japanese yen strengthened against the dollar. Oil prices remained close to two-month highs, and gold prices remained stable.

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European Stock Futures Show Slight Increase; U.S. CPI Identified as Crucial Factor

European Stock Futures Show Slight Increase; U.S. CPI Identified as Crucial Factor

A slight uptick in European stock futures has been observed, with the U.S. Consumer Price Index (CPI) report playing a crucial role in the trend. As of 02:00 ET (06:00 GMT), Germany’s DAX futures contract traded 0.4% higher, while France’s CAC 40 futures saw an increase of 0.4%. The FTSE 100 futures contract in the U.K., however, remained largely unchanged.

The positivity is believed to stem from the strong close on Wall Street, where the Dow Jones Industrial Average gained over 300 points, or 0.9%. Investors are hopeful that the upcoming U.S. inflation report for June may influence the Federal Reserve to conclude its interest rate hikes earlier than anticipated.

Federal policymakers are expected to raise interest rates during their next meeting later this month, following a pause last month. However, investors are keenly awaiting the monthly consumer inflation report for insights into potential additional hikes. The headline annual figure for June is projected to have risen by 3.1%, down from May’s 4% rise. Meanwhile, the core rate is predicted to have dropped for a third consecutive month to 5%, from 5.3%.

Concerns about aggressive measures to curb inflation potentially leading to a recession in the world’s largest economy have been a significant factor impacting global markets.

In Europe, German inflation rose 6.4% annually in June, halting a steady decline since the beginning of the year. In contrast, Spanish inflation is expected to rise 1.9% year-on-year in June, falling short of the European Central Bank’s 2% target. This suggests that the central bank should contemplate concluding its rate-hiking cycle.

Oil prices have stabilized due to predictions of increased demand offsetting rising U.S. crude stockpiles. Major oil producers, including Saudi Arabia and Russia, have announced additional output cuts for August. A weakening U.S. dollar, which is suspected to be a result of the Federal Reserve nearing the end of its rate-hiking cycle, supports the oil market.

However, data from the American Petroleum Institute showed an unexpected growth of over 2 million barrels in U.S. crude stockpiles in the week leading up to July 7. Official numbers from the Energy Information Administration are yet to be released.

Gold futures rose 0.4% to $1,944.60/oz, and the EUR/USD exchange rate increased slightly, trading 0.2% higher at 1.1031.

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Gold Struggles Below $3,300 as Fed Rate Cut Hopes Dim Ahead of FOMC Minutes

Gold Struggles Below $3,300 as Fed Rate Cut Hopes Dim Ahead of FOMC Minutes

Gold (XAU/USD) dipped to a one-and-a-half-week low near $3,284 during the Asian trading session on Wednesday, weighed down by a stronger US Dollar and rising Treasury yields. Investors are increasingly convinced that recent US tariff hikes may fuel inflation, prompting the Federal Reserve to keep interest rates elevated for longer. 

The firmer Greenback, bolstered by expectations of prolonged Fed tightening and a robust June jobs report, has dulled the appeal of non-yielding assets like gold. Benchmark 10-year US bond yields also climbed, adding further pressure on the precious metal. 

Market participants remain cautious amid ongoing concerns about the economic fallout from Donald Trump’s aggressive tariff proposals. On Tuesday, the former US President threatened to impose duties of up to 50% on copper and 200% on foreign pharmaceuticals, unsettling global markets. However, gold’s traditional safe-haven demand has yet to see significant support in response. 

Traders are now eyeing the release of the FOMC meeting minutes later today, hoping for clues on the Fed’s rate path. Although a July rate cut appears off the table, markets are still pricing in up to 50 basis points of easing by year-end, likely beginning in October. 

Technically, a break below the $3,300 level, coupled with resistance at the 100-period SMA on the 4-hour chart, signals further downside. Momentum indicators suggest gold could slide towards the next support at $3,270, with a deeper drop towards $3,248–$3,247 not ruled out. 

On the upside, recovery attempts may face initial resistance near $3,310 and stronger barriers around $3,326 and $3,340. A decisive move above $3,360 could open the door to a short-term rebound toward the $3,400 mark. 

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Gold Price Climbs Steadily

Gold Price Climbs Steadily, Eyes Record High Amid Trade War Concerns

Gold (XAU/USD) extends its intraday rally, reaching the $2,880 region during the Asian session on Monday. The gains come in response to US President Donald Trump’s plan to impose new 25% tariffs on all steel and aluminum imports, reigniting fears of a global trade war and driving demand for the safe-haven precious metal. Additionally, concerns that Trump’s protectionist policies could fuel inflation further bolster gold’s appeal as a hedge against rising prices.

Gold Supported by Trade War Fears, But Fed Policy Remains a Concern

Despite strong upside momentum, gold’s gains may face limitations due to the resilient US Dollar (USD) and expectations that the Federal Reserve (Fed) might delay further rate cuts. The strong US employment data released on Friday, coupled with inflationary concerns, has reinforced speculation that the Fed will maintain a cautious stance.

Overbought conditions on the daily chart could also deter traders from initiating fresh bullish positions, especially in the absence of key US economic data early in the week.

Trump’s Tariff Announcement Sparks Market Uncertainty

On Sunday, Trump reaffirmed plans to impose 25% tariffs on all steel and aluminum imports into the US, adding that his administration would match tariff rates imposed by other countries. These announcements have further fueled uncertainty and strengthened gold’s safe-haven appeal.

Meanwhile, geopolitical tensions remain elevated. Russian Deputy Foreign Minister Galuzin stated there are no satisfactory proposals for Ukraine peace talks, dismissing Western statements as mere rhetoric. US Vice President JD Vance is reportedly heading to Germany this week to outline US policy proposals.

Fed Policymakers Express Caution Amid Economic Uncertainty

The latest US Nonfarm Payrolls (NFP) report showed 143K jobs were added in January, falling short of the 170K estimate but offset by an unexpected dip in the Unemployment Rate to 4.0%. While the report provides mixed signals, it has reinforced the belief that the Fed will remain cautious regarding further monetary easing.

Several Fed officials have weighed in on economic policy:

  • Minneapolis Fed President Neel Kashkari stated he would consider supporting further rate cuts if inflation data remains favorable and the labor market stays strong.
  • Chicago Fed President Austan Goolsbee noted that inconsistent US government policies create economic uncertainty, making it difficult to assess inflation trends.
  • Fed Governor Adriana Kugler acknowledged steady US economic growth but warned that progress toward the 2% inflation target remains uneven and slow.

What’s Next for Gold?

A stronger US Dollar could act as a headwind for gold prices, limiting aggressive bullish momentum. Traders will closely monitor Fed Chair Jerome Powell’s semi-annual congressional testimony and the upcoming US consumer inflation figures for further market direction.

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Gold Price Rally Holds Strong, But Overbought Conditions Raise Caution

Gold Price Bulls Hold Firm, But Overbought Conditions Suggest Caution

Gold (XAU/USD) continues its upward trajectory through the Asian session on Wednesday, reaching a fresh all-time high near $2,858. Concerns about the economic impact of US President Donald Trump’s trade tariffs continue to drive demand for the safe-haven metal. Furthermore, predictions that the Federal Reserve (Fed) would continue its easing cycle, backed by signs of deteriorating momentum in the US labor market, are fuelling demand for the non-yielding yellow metal.

 

Meanwhile, the US dollar (USD) remains under pressure near its weekly low, with rising expectations of further Fed policy easing, offering an extra lift to gold prices. However, Trump’s decision to suspend tariffs on Canada and Mexico has contributed to a risk-on mentality, which may restrict future gains for XAU/USD. Furthermore, gold is entering overbought territory on the daily chart, implying a short-term consolidation or minor retreat before the advance begins. Traders are now waiting for significant U.S. data releases, such as the ADP private-sector employment report and the ISM Services PMI, for new market signals.

Gold Bulls Retain Control Amid US-China Trade Tensions

Despite the positive risk tone, a further escalation in U.S.-China trade tensions continues to lend support to the upward momentum in gold. In response to President Trump’s latest tariffs, China has imposed targeted duties on US imports, and the threat of a trade war between the world’s two biggest economies has seen gold reach an all-time high on Wednesday.

On the macroeconomic front, the Job Openings and Labor Turnover Survey (JOLTS) released Tuesday revealed a decline in U.S. job openings, dropping to 7.6 million in December from a previous 8.09 million. The data signals a cooling labor market, increasing the likelihood of additional Fed rate cuts. This has kept USD bulls on the defensive and further strengthened XAU/USD.

Trump’s decision to postpone the application of a 25% tax on Canadian and Mexican imports by 30 days has revived hopes that a global trade war can be avoided. However, this has done little to undermine the positive enthusiasm toward gold.

Market players will be keenly monitoring Wednesday’s U.S. economic data, such as the ISM Services PMI and the ADP employment report, which may cause short-term changes in gold prices. However, Friday’s highly anticipated Nonfarm Payrolls (NFP) report continues to be the main focus. Furthermore, any fresh information about trade tariffs is probably going to cause financial markets to become more volatile.

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WTI Crude Oil Struggles Near $72.00, 100-Day SMA Holds as Key Support

WTI Crude Oil Struggles Near $72.00, 100-Day SMA Holds as Key Support

West Texas Intermediate (WTI) crude oil prices fell from a one-week high on Tuesday, attracting sellers for the second straight session. The commodity trades at $72.00, barely above last week’s one-month low and close to the important 100-day Simple Moving Average (SMA) support. 

US Tariff Delay Weighs on Oil Prices

US President Donald Trump has announced a one-month suspension on newly imposed tariffs on imports from Canada and Mexico, easing worries about potential supply disruptions from two of the country’s main oil suppliers. This development put downward pressure on crude oil prices. Furthermore, fears of lower gasoline demand—driven by the larger economic impact of Trump’s trade policies—are contributing to gloomy sentiment in the oil market.

OPEC+ Stands Firm on Production Policy

Despite Trump’s calls for higher output to combat rising oil prices, the Organization of Petroleum Exporting Countries and its allies (OPEC+) have chosen to keep current production levels. This decision may give some support for crude oil prices, avoiding further losses in the near term.

Key Technical Levels to Watch

Traders will closely monitor the 100-day SMA, currently positioned near the $71.00 mark, which serves as a crucial support level. A decisive break below this threshold could trigger an extended pullback from the recent multi-month highs. Conversely, a bounce from this level may reinforce buying interest and help WTI recover from its recent slump.

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Gold Holds Below $2,800 Despite Intraday Recovery

Gold Price Trims Intraday Losses but Remains Below $2,800 Amid Stronger USD

The gold price (XAU/USD) recovers some of its losses following the strong Asian session sell-off but remains in negative territory, hovering around $2,785, down about 0.60% for the day. The recent rise in the US Dollar (USD), fueled by President Donald Trump’s decision to impose tariffs on Canada, Mexico, and China, has pushed the greenback closer to a two-year high, weighing on gold and dragging it away from its all-time high of $2,817, hit on Friday.

However, projections that the Federal Reserve (Fed) would lower interest rates twice by the end of 2025, combined with indications about probable economic disruptions from Trump’s trade policies, contribute to gold’s safe-haven appeal. The current risk-off mentality further shields the downside, so bearish traders should exercise caution ahead of this week’s key US macroeconomic data, which begins with today’s ISM Manufacturing PMI release.

Technical Outlook: Gold’s Uptrend Intact Despite Intraday Pullback

From a technical perspective, the intraday decline found support near the $2,772 resistance-turned-support level, which now serves as a pivotal point. A decisive break below this zone could trigger further selling pressure, exposing gold to the next key support levels:

 

  • $2,755 – Initial downside target
  • $2,740 – Intermediate support
  • $2,725-$2,720 – Strong demand zone
  • $2,700 – Psychological level, a break below which could accelerate losses

Conversely, immediate resistance is seen in the $2,790-$2,800 region, followed by the record high of $2,817. Notably, momentum indicators on the daily chart remain comfortably positive, indicating that gold has not yet reached overbought levels. This provides room for additional upward momentum, confirming the broader bullish trend that began with the December swing bottom.

If gold manages to sustain a move above $2,817, it could pave the way for fresh record highs, with bulls eyeing further gains amid ongoing market uncertainty.

Market Drivers to Watch

US Dollar Strength: The impact of Trump’s tariffs on global trade could continue supporting the USD, potentially weighing on gold.

Federal Reserve Policy: Expectations of rate cuts in 2025 remain a crucial factor for gold’s long-term trajectory.

US Economic Data: The upcoming ISM Manufacturing PMI and Nonfarm Payrolls (NFP) report later this week could trigger volatility in gold prices.

Risk Sentiment: Any escalation in geopolitical or economic tensions could further boost gold’s safe-haven demand.

Overall, while gold has retreated from its highs, the larger bullish trend remains intact, with technical signals suggesting further upward movement as long as critical support levels hold.

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WTI Slips to $71.00 Amid Trade Tariff Concerns and Weak China Data

WTI Slips to $71.00 Amid Trade Tariff Concerns and Weak China Data

West Texas Intermediate (WTI) crude oil prices edge lower during Wednesday’s Asian session, erasing part of the previous day’s modest recovery from a nearly three-week low. The commodity trades near $71.00, down over 0.25% for the day, and remains vulnerable to further losses amid prevailing bearish sentiment.

Investor concerns persist over US President Donald Trump’s threat to impose trade tariffs on Canada, China, and Mexico by February 1, which could weigh on global fuel demand. Additionally, weak Chinese economic data adds to downward pressure. Official PMIs released on Monday highlighted continued weakness in the world’s second-largest economy and top crude importer, raising concerns over lower consumption.

Further pressure on oil prices comes from Trump’s energy policies, which include plans to ramp up US energy production and calls for the Organization of Petroleum Exporting Countries (OPEC) to increase output to drive prices lower.

With bearish fundamentals dominating, WTI remains susceptible to further downside risks in the near term.

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WTI Drops Toward

WTI Drops Toward $74.00 as Trump Pressures OPEC to Lower Oil Prices

West Texas Intermediate (WTI), the US crude oil benchmark, trades near $74.10 on Friday, continuing its downward trend after US President Donald Trump urged Saudi Arabia and the Organization of the Petroleum Exporting Countries (OPEC) to reduce oil prices.

Uncertainty surrounding Trump’s proposed tariffs and energy policies adds to the pressure on WTI. Speaking at the World Economic Forum in Davos on Thursday, Trump announced plans to request Saudi Arabia and OPEC to lower oil prices, saying, “I’m also going to ask Saudi Arabia and OPEC to bring down the cost of oil.”

Expectations of increased US production under Trump’s administration further weigh on oil prices. Earlier this week, Trump declared a national energy emergency, leveraging his authority to expedite the approval of oil, gas, and electricity projects that would typically require years of permitting.

Meanwhile, US crude inventories declined for the ninth consecutive week. The US Energy Information Administration (EIA) reported a drop of 1.017 million barrels in crude oil stockpiles for the week ending January 17, following a 1.962 million-barrel decline in the prior week. Market expectations had forecast a larger decrease of 2.1 million barrels.

Oil traders will closely monitor developments surrounding Trump’s energy policies and tariff announcements. Additionally, attention will shift to the preliminary US S&P Global Purchasing Managers Index (PMI) for January, set for release later on Friday. A weaker-than-expected reading could pressure the US Dollar (USD), potentially offering some support to the USD-denominated WTI price.

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EUR/USD Price Forecast

EUR/USD Price Forecast: Consolidating Below 1.0500 Amid Multi-Week High

The EUR/USD currency pair is having a hard time continuing its recent winning streak, trading in a tight range just below the 1.0500 psychological mark during the Asian session on Monday. In spite of the consolidation, the pair is still close to its three-week high of Friday, buoyed by a weaker US Dollar (USD).

Technically, the pair‘s location above the 38.2% Fibonacci retracement level of the November-January bear run, combined with upbeat oscillators on the daily chart, indicates that the bullish momentum is still intact. This leaves room for a potential rally towards the 1.0545-1.0555 resistance area, which coincides with the 50% Fibonacci retracement level and the 100-day Exponential Moving Average (EMA).

A successful breach above this crucial barrier may set the stage for additional gains, with EUR/USD potentially challenging the 1.0600 level. A break above this level may propel the pair towards the December 2024 swing high of 1.0630, close to the 61.8% Fibonacci retracement level. Further bullish momentum may continue to drive the rebound from its more than two-year low in January.

To the contrary, however, the 38.2% Fibonacci level of 1.0465 acts as an instant support level. A resolute breach through this area can drive selling momentum faster, pulling the pair towards the 1.0400 round number and down further into the mid-1.0300s (23.6% Fibonacci level). Failure to hold these levels could shift the bias in favor of bearish traders, potentially exposing the 1.0200 handle.

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EUR/USD Eases Near

EUR/USD Eases Near 1.0300 Ahead of Lagarde’s Speech

The EUR/USD pair edges lower to approximately 1.0310 during the Asian session on Monday, weighed down by a stronger US Dollar (USD). Market participants are focused on the upcoming Eurozone Sentix Investor Confidence data for February and a speech by European Central Bank (ECB) President Christine Lagarde later in the day.

On Friday, former US President Donald Trump announced plans to introduce reciprocal tariffs on multiple countries by Tuesday or Wednesday, though he did not specify which ones. This move has heightened concerns about a global trade war, fueling demand for the safe-haven USD.

“The immediate concern might not be inflation, as counter-effects like a demand slowdown could come into play. However, the bigger issue is uncertainty and the shift toward a more protectionist world,” said Charu Chanana, Chief Investment Strategist at Saxo.

Meanwhile, the Euro faces pressure from growing expectations of further ECB rate cuts amid sluggish economic growth. ECB Governing Council member Boris Vujcic stated that the market’s anticipation of three rate cuts this year is reasonable. However, he emphasized that greater clarity on monetary policy direction may not emerge until early in the second quarter.

Traders will keep a close eye on US trade policies, especially Trump’s repeated threats against Europe. JPMorgan economist Nora Szentivanyi noted that the objectives, timing, and tariff rates remain unclear. Nonetheless, the European Commission has stated it would retaliate firmly against any tariffs imposed by the US.

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EUR/USD Holds Below 1.0400 Ahead of Eurozone Retail Sales Data

EUR/USD Struggles Below 1.0400 Ahead of Eurozone Retail Sales Data

EUR/USD is trading lower around 1.0390 in the Asian session on Thursday, extending losses following a two-day recovery. Investors remain wary ahead of the release of Eurozone Retail Sales data later today.

Market predictions suggest that Eurozone retail sales scaled by 1.9% year on year in December, up from the previous 1.2% increase. However, the monthly number is expected to fall by 0.1%, erasing the 0.1% increase reported in November.

The euro remains under pressure as market sentiment points to further monetary easing by the European Central Bank (ECB). Policymakers feel optimistic that inflation will steadily return to the ECB’s 2% objective, lessening the need for additional tightening.

Meanwhile, the US Dollar Index (DXY), which tracks the dollar against six major currencies, has stabilized at 107.70, restricting EUR/USD’s upside potential. The dollar’s resiliency comes after a three-day losing skid, which puts pressure on the pair.

On Thursday, Federal Reserve Vice Chair Philip Jefferson reiterated his desire for keeping existing interest rates, underlining that the Fed’s policy remained restrictive despite the 100-basis-point drop. Meanwhile, San Francisco Federal Reserve President Mary Daly emphasized the central bank’s cautious attitude in the face of prolonged economic uncertainties.

The dollar weakened on Wednesday following a disappointing US Services PMI reading. The ISM Services PMI dropped to 52.8 in January from a revised 54.0 in December, falling short of the market consensus of 54.3. Looking ahead, traders are watching Friday’s US Nonfarm Payrolls (NFP) report, which might influence the Federal Reserve’s next policy actions.

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EUR/USD Stuck in Range Near 1.0375-1.0380 as Bulls Struggle for Direction

EUR/USD Struggles for Clear Direction, Stays Range-Bound Near 1.0375-1.0380

The EUR/USD pair continues in consolidation mode, failing to build on its recent recovery from the 1.0200 region—the lowest level since January 13. After reaching a weekly high earlier on Wednesday, the pair is fluctuating within a narrow range around 1.0375-1.0380, showing little change for the day amid mixed market signals.

Tuesday’s Job Openings and Labor Turnover Survey (JOLTS) indicated a cooling U.S. labor market, reinforcing expectations of Federal Reserve (Fed) policy easing. Markets are now factoring in the likelihood of two rate cuts by the Fed this year. Risk-on sentiment also remains prevalent, but should continue to weigh on demand for the safe-haven USD, and thereby support EUR/USD.

Upside momentum, however remains constrained by issues on the introduction of U.S. tariffs over the goods to be imported in Europe under Trump’s administration, among others, and the ECB dovish direction which is being felt in restraining the Euro though HICP was reported higher to an annual rate of 2.5% in the last month, still, does not allow much upside in this pair.

Looking ahead, market participants will focus on the final Eurozone Services PMI release, while the U.S. economic calendar highlights the ADP private-sector employment report and the ISM Services PMI. Movements in the USD could also be influenced by key FOMC member speeches. Still, Friday’s NFP report will focus more attention on it as it will help deliver a better picture of the situation in the U.S. labor market and set the direction for future Fed policy.

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GBP/USD Holds Above 1.2400 as Markets Watch China Tariff Developments

GBP/USD Holds Above 1.2400 as Markets Watch China Tariff Developments

GBP/USD extends its gains for a second consecutive session, trading around 1.2430 during Asian market hours on Tuesday. With  the  decision   by   U.S. President Donald Trump   to pause tariffs on Mexico and Canada , the pair benefits from a risk-on sentiment .

Despite this, investors continue to pay close attention to ongoing trade negotiations, making market volatility a major concern. Trump declared that he would postpone imposing high tariffs on Canada and Mexico for at least 30 days following their agreements to send 10,000 troops to the U.S. border to fight drug trafficking.

This move follows Trump’s recent decision to impose 25% tariffs on Mexican and Canadian goods, along with a 10% tariff on Chinese imports. Additional tariffs on China are anticipated to go into effect Tuesday at 5:00 GMT. Trump managed to say that talks with Chinese officials might happen “probably over the next 24 hours,” and that tariffs on China would be “very, very substantial” if an agreement could not be made.

Meanwhile, the U.S. Dollar Index (DXY), which tracks the USD against six major currencies, hovers around 108.70 after erasing most of its gains from the previous session. Strong U.S. economic data could provide support for the greenback, as the ISM Manufacturing PMI climbed to 50.9 in January from 49.3 in December, surpassing the expected 49.8.

While GBP/USD may rise, the British Pound’s upside may be limited, given the expectation that the Bank of England (BoE) will cut interest rates once again. Despite rising wages in the UK, the BoE is expected to lower interest rates by 25 basis points to 4.5% on Thursday.

The BoE’s Monetary Policy Committee (MPC) is expected to vote 8-1 in favor of the rate cut, with one member likely advocating for maintaining rates at their current level for now.

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EUR/USD Drops to 1.0200 on Trump’s Trade Tariffs

EUR/USD Slumps to Multi-Week Low Near 1.0200 Amid Trump’s Trade Tariffs

The EUR/USD pair extends its decline on Monday, plunging to the 1.0200 region—a three-week low—during the early Asian session. This drop brings the pair closer to its lowest level in over two years, last seen in January, reinforcing the ongoing multi-month downtrend.

The US Dollar (USD) gains broad strength following President Donald Trump’s weekend announcement of new tariffs: 25% duties on imports from Canada and Mexico, along with an additional 10% tariff on Chinese goods. These measures escalate global trade tensions, dampening investor appetite for riskier assets and boosting demand for the safe-haven USD. As a result, the EUR/USD pair faces renewed selling pressure.

Adding to the bearish sentiment, Trump also declared on Friday evening that he would impose tariffs on goods from the European Union. This, coupled with the European Central Bank’s (ECB) dovish stance, further weighs on the euro. Last Thursday, the ECB cut borrowing costs by 25 basis points (bps) as expected and signaled the possibility of additional rate cuts before the year’s end, exacerbating the euro’s weakness.

The policy divergence between the ECB and the Federal Reserve (Fed) further tilts market sentiment in favor of the USD. While the Fed has opted for a hawkish pause, supporting the dollar’s strength, a recent pullback in US Treasury yields may limit further USD gains and offer some relief to the EUR/USD pair. However, the overall market outlook suggests that the pair’s downside momentum is likely to persist.

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EUR/USD Holds Above 1.0400 | Focus on Q4 GDP & ECB Policy Decision

EUR/USD Holds Above 1.0400 Ahead of Q4 GDP Data and ECB Policy Decision

The EUR/USD pair is edging higher after three consecutive losses, trading near 1.0420 during Thursday’s Asian session. The rebound is primarily driven by a technical pullback in the US Dollar (USD). Meanwhile, the US Dollar Index (DXY), which tracks the greenback against six major currencies, remains just below 108.00.

Despite the recent uptick, further gains for EUR/USD may be capped as the USD could regain strength following the Federal Reserve’s (Fed) cautious approach to monetary policy. The Fed reinforced its hawkish stance by removing language suggesting confidence in inflation reaching its 2% target.

During his press conference, Fed Chair Jerome Powell emphasized that any policy changes would require “real progress on inflation or some weakness in the labor market.” As expected, the Fed maintained its overnight borrowing rate at 4.25%-4.50% during its January meeting on Wednesday. This decision follows three consecutive rate cuts since September 2024, totaling a one-percentage-point reduction.

Meanwhile, the Euro faces downward pressure as the European Central Bank (ECB) is widely expected to cut interest rates by 25 basis points in its policy meeting on Thursday, lowering the Deposit Rate to 2.75%. Market sentiment suggests that further rate cuts from the ECB may follow in the coming months, potentially weighing on the Euro.

Investors will closely watch the release of fourth-quarter Gross Domestic Product (GDP) data from the Eurozone and Germany on Thursday. Later in the day, focus will shift to the US Annualized GDP report, which could influence market sentiment and currency movements.

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European Futures Decline Amidst Rising Yields and Market Downturn

UAE and China Renew $4.9 Billion Currency Swap Agreement

UAE and China Renew $4.9 Billion Currency Swap Agreement

The United Arab Emirates (UAE) and the People’s Republic of China have reinforced their financial ties by renewing a substantial currency swap arrangement. On Tuesday, the Central Bank of the UAE and the People’s Bank of China ratified a continuation of their bilateral currency swap agreement. This deal, valued at 18 billion Emirati Dirhams (approximately $4.9 billion), is set to last for another five years, as confirmed by the UAE’s financial regulator through an official statement. This extension is more than a financial protocol; it represents a strategic effort to deepen the financial and trade relations between the two nations.

In a move signaling commitment to future-oriented financial technology, both nations have also consented to collaborate on the evolution of digital currencies. This is cemented by a newly signed memorandum of understanding (MoU) aimed at fostering cooperation in the burgeoning domain of central bank digital currencies (CBDCs). Under the terms of this MoU, the UAE and China will exchange knowledge on best practices and regulatory frameworks pertinent to digital currencies, and will jointly support the advancement of shared initiatives and projects in this field.

A hallmark of this collaborative venture is the “mBridge” project. This initiative is a pioneering platform involving multiple central banks and is designed to expedite cross-border trade payments, enabling them to occur with near-instantaneous processing times. Such technological advancements are indicative of the shifting paradigm in global financial transactions, reflecting an increasing reliance on digital solutions to streamline and secure cross-border commerce.

The economic relationship between the UAE and China is robust, with the UAE being China’s premier trading partner within the Gulf Cooperation Council (GCC) as of 2021. Notably, the value of non-oil trade transactions between these nations reached an impressive AED264.2 billion in 2022, marking a significant growth of 18% from the previous year. This flourishing trade relationship is a testament to the deep economic integration and mutual reliance that characterize the bond between the two countries.

China’s investment footprint in the UAE is equally noteworthy. As of the beginning of 2021, China was recognized as the third-largest foreign investor in the UAE, boasting investments upwards of $9.3 billion. This figure represents an extraordinary increase of more than 500% from the levels recorded in 2013, as reported by the UAE’s Ministry of Economy. This surge in investment underscores the confidence and strategic interest China places in the UAE’s economic landscape, further solidifying the long-term economic partnership between the two nations.

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Yuan’s Rally Strengthens with the Support of Seasonal Trends

Yuan’s Rally Strengthens with the Support of Seasonal Trends

The Chinese yuan is experiencing a notable upswing, propelled by seasonal forces and market speculation that anticipates a continuous rally. Historical data reveals a pattern of the yuan gaining strength in the final months of the year, a trend particularly pronounced in 2022 as reported by financial analysis. This seasonal rise is attributed to the increased need for local currency by exporters, preparing for the year-end financial settlements and the upcoming Lunar New Year celebrations, as observed by China International Capital Corp.

Throughout this year, the yuan has struggled compared to other Asian currencies, prompting corporations to delay converting their dollar reserves in hopes of more advantageous exchange rates. However, with the yuan on course for its most robust month in twelve months amidst a waning US dollar, the tide may be shifting. Companies are likely to adjust their strategies, potentially initiating a more robust and enduring recovery for the yuan.

The sustainability of the yuan’s rally is closely tied to the performance of the US dollar. Analysts, including Evercore ISI’s Neo Wang, recognize December as a critical period where historical patterns suggest a strong yuan performance against the dollar.

Market sentiment is also buoyed by the belief that the yuan’s prolonged decline has reached a turning point, with forecasts suggesting that it may approach the 7-per-dollar mark, a rate last witnessed in May.

The shift in sentiment regarding Chinese financial assets is notable, as economic policymakers in China intensify efforts to revitalize the struggling property sector and as geopolitical tensions ease. The People’s Bank of China has continued to set a supportive reference rate for the yuan, which has recently outperformed this benchmark for the first time since mid-2022. The onshore yuan’s closure at an appreciating rate further signals confidence in the currency’s trajectory.

Looking ahead, analysts maintain an optimistic view for the yuan’s performance as the year draws to a close and looking into 2024. Factors contributing to this positive outlook include a stabilizing macroeconomic environment and favorable seasonal patterns that typically benefit the yuan towards the end of one year and the start of the next. This sentiment reflects a broader confidence in the resilience and potential upturn of the yuan in the global currency markets.

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Japanese Yen Gains on Soft Dollar, Fed Dovishness, and Bullish BoJ Outlook

Japanese Yen Gains on Soft Dollar, Fed Dovishness, and Bullish BoJ Outlook

The Japanese Yen (JPY) has recently retreated from its strong gains against the US Dollar (USD), marking a second day of weakening on Wednesday. This shift comes after the US Federal Open Market Committee’s (FOMC) hawkish minutes and better-than-expected labor and consumer sentiment data provided a boost to the USD, lifting it from its lowest levels since the end of August. Consequently, the USD/JPY pair made a notable recovery from the 147.15 area, which was a two-month low reached on Tuesday.

Despite this, spot prices struggled to maintain their upward trajectory past the 149.75 level, facing resistance on Thursday. Market sentiment is tilting toward the belief that the Federal Reserve (Fed) may have concluded its policy-tightening phase and could begin reducing interest rates by May 2024. This anticipation has led to a decline in US Treasury yields, resulting in the selling off of the USD. Furthermore, the possibility of a hawkish pivot in the Bank of Japan’s (BoJ) policy has exerted downward pressure on the USD/JPY, keeping it subdued near the 149.00 level as the European trading session approaches.

In the recent market movements, the Japanese Yen did see a dip to 149.75 against the Dollar on Wednesday but managed to recoup some of its losses by Thursday. Market speculation is rife that the BoJ may terminate its negative interest rate policy in early 2024, contributing to the USD/JPY’s dip on Thursday. Despite this, minutes from the Fed’s last meeting hint at a continued restrictive stance on interest rates.

Economic data from the US painted a mixed picture: Initial Jobless Claims fell significantly to 209,000 for the week ending November 18, indicating a robust labor market. However, the Consumer Sentiment Index continued to decline, reaching 61.3 in November, and inflation expectations rose to 4.5%, marking the highest since April 2023. Durable Goods Orders also fell by 5.4% in October, signaling economic headwinds.

Market participants are now discounting the likelihood of further Fed rate hikes, with many anticipating a rate cut by mid-2024. Traders, adjusting their positions ahead of the US Thanksgiving holiday, are now turning their attention to forthcoming PMI data from the Eurozone and the UK, which could affect global risk sentiment and the demand for the safe-haven Yen. The upcoming release of Japan’s National core CPI, followed by US PMIs, will also be closely monitored for their potential impact on currency markets.

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ECB Highlights Potential Stability Risks from Bank Taxation Impacting Valuations

ECB Highlights Potential Stability Risks from Bank Taxation Impacting Valuations

The European Central Bank (ECB) recently expressed concerns about the potential risks to financial stability arising from special taxes imposed on banks. According to an ECB report released on Monday, these taxes could lead to tighter financing conditions across the region, exacerbated by the low stock market valuations of these financial institutions.

Despite European banks reporting their highest earnings in several years, their stock values have not seen a significant increase from the pre-COVID-19 pandemic levels. The ECB attributes this discrepancy partly to the proposed special bank taxes in various countries, sparking worries about the implications for shareholder dividends.

The ECB’s report emphasizes the long-term risks associated with these developments. Banks that are undervalued by investors could face difficulties in raising new equity when necessary. This scenario is particularly concerning as the capital needed to support lending is funded by lending rates. Therefore, weaker valuations of banks could lead to stricter financing terms and conditions, directly affecting the broader economy.

Special bank taxes have become a favored approach by governments to address budget deficits, particularly in the context of rising borrowing costs. Many policymakers justify these taxes by pointing out that banks have disproportionately benefited from the rapid increase in interest rates, yet have been slow in passing these benefits on to consumers.

Over the past two years, various proposals for special banking taxes have been introduced, with the aim of generating over €6 billion for government coffers next year, as per Bloomberg News. Nonetheless, the actual revenue generated may be lower than anticipated due to exemptions and loopholes. For instance, in Italy, certain provisions allow banks to circumvent these taxes.

This situation poses a complex challenge for policymakers and regulators. On one hand, there is a need to manage public finances effectively, especially in a period marked by economic uncertainty and rising costs. On the other hand, ensuring the stability and health of the banking sector is crucial for the overall economy. The ECB’s warning underlines the delicate balance that must be struck between these objectives.

The report by the ECB serves as a cautionary note, highlighting the intricate link between fiscal policies, bank valuations, and economic stability. It calls for careful consideration of the implications of such tax measures on the banking sector and, by extension, on the financing conditions within the European economy. As governments navigate these challenges, the focus remains on finding a sustainable solution that supports public finances without compromising the stability and efficiency of the banking system.

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Pimco Invests in Yen Anticipating Stricter BOJ Policies

Pimco Invests in Yen Anticipating Stricter BOJ Policies

Pacific Investment Management Co. (Pimco) is strategically purchasing Japanese yen, speculating that Japan’s central bank may soon implement tighter monetary policies due to rising inflation. The investment firm took a bullish stance on the yen, building up a long position as the currency’s value dipped beyond 140 to the US dollar. This move aligns with Pimco’s anticipation of a potential policy shift by the Bank of Japan (BOJ), including a move away from its yield-curve control policies and possibly leading to an interest rate hike.

Despite a general expectation of a yen rally due to contrasting policies of a hawkish Federal Reserve and a dovish BOJ, the yen has depreciated over 12% against the dollar this year, nearing a three-decade low. This decline occurred even as the BOJ has shown signs of easing its tight control over the yield curve.

The BOJ’s incremental steps towards a more constricted monetary stance have not yet resulted in a durable appreciation of the yen. In fact, leveraged funds have increased their short positions on the currency, indicating a widespread prediction of further depreciation.

Emmanuel Sharef of Pimco believes there is a clear need for the BOJ to continue tightening its monetary policy, possibly through more subtle methods initially, such as gradually phasing out its yield-curve control, with a potential rate hike on the horizon.

Former Federal Reserve Vice Chair Richard Clarida, now with Pimco, has speculated that the BOJ may abandon its yield-curve control by the end of the year if inflation persists and could adjust its short-term interest rate to zero from the current negative rate early next year.

Japan’s inflation cooled slightly to below 3% in September, offering some validation to the BOJ’s assessment that inflationary pressures are reaching their peak. However, the rate still exceeded the consensus forecast.

In the backdrop of market dynamics, Sharef also manages strategies at Pimco, such as the Inflation Response Multi-Asset Fund, which has outperformed the majority of its peers over the past three years. Moreover, the yen might find additional support from possible intervention by Japanese authorities, similar to their actions last year when the currency’s value fell sharply. Sharef noted the BOJ’s sensitivity to the yen’s fluctuations, especially around the 150 mark against the dollar, suggesting that intervention remains a significant consideration for the central bank.

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Australian Dollar Recovers from Intraday Losses

Australian Dollar holds above key level before US housing data release

Australian Dollar holds above key level before US housing data release

The Australian Dollar (AUD) continues to navigate through difficult market conditions, maintaining its stance above a significant threshold as it grapples with losses incurred on Friday. This comes in the wake of disappointing economic figures from the United States (US), which were publicized on Thursday. The apparent weakness of the AUD/USD exchange rate could be a reflection of market trepidation, potentially rooted in uncertainties surrounding the Federal Reserve’s (Fed) interest rate decisions. Nevertheless, recent softness in the US job market, alongside fresh inflation figures, seem to bolster the argument that further rate hikes by the Fed may be off the table for now.

Despite the release of positive job data from Australia, which showed an unexpected surge in employment figures for October, the AUD struggled to capitalize on these gains. The increase in employment exceeded market expectations, but a closer look revealed that the majority of these new roles were part-time, which cast a shadow over the seemingly favorable news.

The US Dollar Index (DXY), a measure of the currency’s strength against a basket of foreign currencies, experienced a lateral movement marked by a slight negative undertone. This came after a session marked by volatility that initially seemed to support the US Dollar. Yet, even in the face of weaker-than-anticipated US economic statistics and a dip in bond yields, the Dollar managed to regain some of its lost ground. Notably, the yield on the 10-year US Treasury note saw a decline, reaching a low of 4.43% on Thursday.

In the US, the number of continuing jobless claims for the week ending November 3 hit the highest point recorded for the year, standing at 1.865 million, an increase from the prior count of 1.833 million. Furthermore, initial jobless claims for the week ending on November 10 witnessed a rise to 231,000, surpassing the anticipated 220,000, marking the highest surge in nearly three months. However, there was a silver lining in the form of the Philadelphia Fed Manufacturing Survey, which indicated a less negative output at -5.9, an improvement from the previous -9.0 reading.

As the market looks forward, the release of US housing data on Friday is keenly awaited. This data is likely to shed new light on the state of the housing market and could significantly sway trading dynamics for currency pairs such as the AUD/USD. Investors and traders alike are closely monitoring these indicators as they can have substantial implications for future monetary policy and economic health assessments.

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Australian Dollar Drops on Weak GDP Data and RBA Rate Cut Bets

Steady Growth in Australian Employment Accompanied by a Slight Rise in Unemployment Rates

Steady Growth in Australian Employment Accompanied by a Slight Rise in Unemployment Rates

Despite a stronger-than-anticipated surge in employment for October, Australia has seen a slight uptick in its unemployment rate, suggesting that the Reserve Bank of Australia (RBA) may need to implement further measures to temper demand and curb inflationary pressures. The Australian economy saw the addition of 55,000 jobs, outstripping the predicted 24,000, with part-time roles being a significant contributor to this growth. The increase in employment, however, did not translate into a lower unemployment rate, which rose slightly to 3.7%, aligning with projections and maintaining the trend observed since the previous year, fluctuating between 3.4% and 3.7%.

The heightened unemployment rate can be attributed to an increase in the number of individuals actively seeking employment, as evidenced by the leap in the participation rate to 67%. The Australian Bureau of Statistics (ABS) has linked this outcome to the temporary employment spurred by the October 14 referendum. This phenomenon seemed to have minimal impact on market sentiments, which remained relatively stable in response to the new data.

According to Diana Mousina, the deputy chief economist at AMP Ltd., the current statistics do not strongly indicate the necessity for an immediate rate increase in the upcoming December board meeting. Nonetheless, the prospect of a rate hike in February 2024 remains, contingent on the forthcoming quarterly inflation figures. Mousina further predicts a potential weakening in the macroeconomic climate by that time.

This labor market assessment follows closely on the heels of a business survey from earlier in the week, which highlighted sustained vigor within the corporate sector. Nevertheless, it also pointed to initial signs of weakening in forward-looking indicators. Michele Bullock, the new RBA Governor, has remarked on the relaxation of the labor market, which, despite remaining robust, is no longer as constricted as it once was. This observation is corroborated by a decline in certain key indicators, such as job vacancies, which have started to retreat from previously high levels. 

In sum, the Australian labor market is displaying a complex dynamic where increased employment does not necessarily equate to reduced unemployment, due to the growing workforce participation. This situation poses a challenge for the RBA as it navigates the twin objectives of sustaining employment growth while managing inflationary pressures.

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US Yields Boost Dollar, Weaken Yen

US Yields Boost Dollar, Weaken Yen

US Yields Boost Dollar, Weaken Yen

The dollar strengthened on Tuesday, driven by rising U.S. yields, putting pressure on low-yielding currencies like China’s yuan and Japan’s yen, which fell to its lowest level since 1986.

Benchmark 10-year Treasury yields increased nearly 14 basis points to 4.479% overnight. Analysts attributed this rise to expectations of Donald Trump winning the U.S. presidency, which could lead to higher tariffs and increased government borrowing.

As the dollar gained, the euro reversed part of a small rally following the first round of France’s election, which aligned with polling predictions. The euro last traded at $1.0735.

The yen dropped to 161.72 per dollar on Monday, its weakest in nearly 38 years, primarily due to the significant interest rate gap between the U.S. and Japan. On Tuesday, the yen traded at 161.55 per dollar in Asia and was under pressure from yen bears wary of potential intervention by Japanese authorities. The yen also hit a lifetime low of 173.67 against the euro on Monday and remained near that level on Tuesday.

In the bond market, the 10-year yield gap between U.S. and Japanese rates stood at 340 basis points, and nearly 440 basis points at the two-year tenor. China’s yuan, which reached a seven-month low against the dollar last week, faced similar pressure, with U.S. 10-year yields more than 220 basis points higher than Chinese government bond yields.

Robust manufacturing data in China and an announcement from the central bank about borrowing bonds, likely to sell them and stabilize falling yields, provided only a brief boost to the currency on Monday. The yuan last traded at 7.3043 in offshore markets on Tuesday, close to its June low.

The New Zealand dollar slipped 0.3% in early trade and was testing support at its 200-day moving average at $0.6075. The British pound remained steady at $1.2641. The Australian dollar hovered within its recent range at $0.6650, with traders focused on central bank minutes to gauge the likelihood of future interest rate hikes. Swaps market pricing suggests a one-in-three chance of a rate hike as soon as next month.

The question remains about the trigger for such a move. ING economist Rob Carnell noted that discussions have taken place, but the specific trigger for a hike is still uncertain. There is a leaning towards forecasting a hike at the August meeting.

Overall, the strengthening dollar and rising U.S. yields continue to exert pressure on low-yielding currencies, with markets closely watching upcoming central bank decisions and geopolitical developments.

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Cryptocurrency Move Back to Support the Pack to Level

If we have a look at the bearish start to the day in the majors and the Bitcoin move back to the level by $18,500 to the support pack. The Bitcoin to USD was seemed down at the level by 1.16% on this Thursday that reversing a 1.25% gain to the Wednesday to the ended the day at the level $18,260.0. At the start of the day, the Bitcoin rose to the early morning intraday to the high at the level before hitting the reverse level.

The major resistance level goes at the level by $18,878 and the Bitcoin fell to the intraday low to the level by $17,935.0.

The close term bullish pattern stayed flawless, disregarding the most recent pullback to sub-$18,000 levels. For the bears, Bitcoin would have to slide through the 62% FIB of $10,095 to shape a close term bearish pattern.

The Bitcoin was somewhere near at the level by 1.03% to $18,072.0. A blended beginning to the day saw Bitcoin ascend to an early morning high of $18,299.0 prior to tumbling to a low of $18,070.0.

Bitcoin left the significant help and obstruction levels untested from the get-go.

Somewhere else, it was a bearish beginning to the day for the majors. The Ripple’s XRP was somewhere around at the level 2.69% to lead the route down.

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Bitcoin Slips Down Below at Level $13,000 Since the Last Rally

Bitcoin Slips Down Below at Level $13,000 Since the Last Rally

The Bitcoin seems to the low at the level of $9,813 in September that managed the bitcoin to reach at the level high at $13,868. The bitcoin price is rejected to the sequential indicators on the 3-day chart.

If we have a look at the current candlestick of the 3-day chart it will seem significantly bearish and the TD sequential indicators are presented a sell signal. The 50- SMA seems down at the level of $10,600 and the 100 SMA at the level of $9,47.

The In/Out of the Money Around Price chart shows the closest and most grounded help region to be somewhere in the range of the level at $12,687 and $13,073 with near 624,000 BTC in volume. A break below this point can drive the cost of Bitcoin down to $11,914.

Despite the fact that bears appear to have assumed responsibility for the present moment, the powerful day by day upswing stays unblemished for Bitcoin. The 50-SMA and the 100-SMA harmonize around $11,200 which will go about as a critical help level. The MACD keeps bullish and the most basic obstruction level is still at $13,863. A breakout over this point can without much of a range drive the lead digital currency towards the untouched high at the level of $20,000.

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Bitcoin Price Clear the Path and Rose to the Level $13,000

Bitcoin Price Clear the Path and Rose to the Level $13,000

Bitcoin Price of the bulls has been the full control of the market to the price at the level of $11,340 to $12,835. The cryptocurrency had the largest to the single day that put the gain. The MACD shows the increasing the bullish momentum to price the growth anticipated.

The position detector is a convenient little apparatus that causes us to imagine solid opposition and backing levels. According to the everyday conjunction detector, there is an absence of solid obstruction levels on the potential gain. This should be empowering news for the buyers as they plan to bring BTC into the $13,000-zone.

Santiment’s holder’s distribution charts show you the number of addresses having a place with a specific symbolic section. According to the chart, the number of addresses holding 10,000-100,000 tokens tumbled from 111 on October 8 to 104 on October 20. This is an intensely bearish sign as it shows that the whales are selling off their property.

Bitcoin buyers have the opportunity to bring the cost into the level at $13,000 and even the $14,000 interference. The everyday intersection finder shows a total absence of solid opposition barriers straightforward.

For the bears, the drawback is covered off at the $12,000-$12,100 uphold divider. A break below that zone will bring the value down to $11,000, which has both the 50-day and 100-day SMA

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Cryptos Market: Bitcoin Shows Bullish Momentum Over Dollar Strength

Cryptos Market: Bitcoin Shows Bullish Momentum Over Dollar Strength

The BTC/USD traded at the level of $11,355 after the mild rejection of the top-level $11,720 that losing some of the bullish.

Ethereum USD had a similar fate at the higher risk that seeing the longer pullback than the Bitcoin. If we talk about the XRP/USD is the clear loser after breaking below the 50 SMA and the 100 SMA on the daily chart that currently trading at the level of $0.2482 after yet facing another rejection.

Bitcoin, BTC to USD, fell by 1.02% on Tuesday. Incompletely turning around a 1.55% increase from Monday, Bitcoin finished the day at the level of $11,442.0.

It was a quiet beginning to the day. Bitcoin rose to a late morning intraday high to the level of $11,574.9 before operating reverse.

Missing the mark concerning the primary significant obstruction level at $11,830, Bitcoin tumbled to an early evening intraday low of $11,333.0.

Avoiding the primary significant help level at $11,201 Bitcoin quickly returned to $11,470 levels before moving back.

The close term bullish pattern stayed perfect, upheld by the most recent move back through to $11,000 levels. For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to shape a close term bearish pattern.

Bitcoin was up by 0.22% to $11,467.0. A beginning to the day saw Bitcoin tumble to an early morning low of $11,427.0 before ascending to a high at the level of $11,467.0. Bitcoin left the support and Resistance levels untested at an early stage.

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Ethereum Rate Hits at Higher Level More Profitable Than Bitcoin Mining

Ethereum Rate Hits at Higher Level More Profitable Than Bitcoin Mining

Let’s have a look at the cryptocurrency that hovering near to the level at $10,600 mark. The Bitcoin price is consolidating to the 50-12 Hour SMA and the 200-12 Hours SMA. The strong resistance lies at the level 50-12 SMA that repeatedly rejected the price.

This repeated dismissal may drop the value down to the level at  $10,400 uphold level, which is by all accounts the main observable help level on the drawback. If case this level doesn’t hold firm, at that point you can anticipate that the cost should plunge below $10,000. For this situation, one can anticipate that BTC should tumble to the level of $9,700 before it experiences another solid help.

While this may not appear to be a huge number, remember that every one of these addresses holds a great many dollars worth of Bitcoin. The fishes using the stale value activity to merge their positions look good for the general market.

With respect to the top 50 digital forms of money, the greatest failures incorporate Compound, down 12% over the most recent 24 hours, UMA down 12%, OMG Network down at the level 13%, Yearn.finance down 16%, and Aave down 18%. The main bull among the sloths of bears is EOS, which broke out greatly as covered Tuesday.

Ethereum has since September 23, been holding inside a rising equal channel. Recuperation towards $400 flamed out marginally above $360 a week ago. On the drawback, the misfortunes that followed grasped uphold at the level of $335 throughout the end of the week, permitting the shrewd agreement sign to revitalize, making strides above $350.

The Ethereum selling pressure in the market halted the increase at the 50 SMA and 100 SMA. Ether fell below the climbing channel, confirming a bear banner.

The downside of a significant help zone shows that Ethereum is at grave risk of spiraling to the level at $300. Other than the various simple help zones, the most significant one lies somewhere in the range of $298 and $309. Previously, around 879,000 locations purchased almost 2 million ETH.

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Cryptocurrency Bitcoin Shows the Bullish Divergence on User Count

Cryptocurrency Bitcoin Shows the Bullish Divergence on User Count

The Bitcoin moves back and shows the bearish to the start of the day with the support level at $10,900 to the broader market.

The Bitcoin BTC to USD is rose by the level at 1.33% this Tuesday and reversing the loss at the level of 0.83% on Monday.

It was a mixed start to the day. Bitcoin fell to an early morning low $10,674.2 before finding support.

Steering clear of the major support levels, Bitcoin struck a late morning high at the level of $10,815.4 before operating reverse.

Coming up short of the major resistance levels, Bitcoin slid to a late afternoon intraday low $10,654.0.

Steering clear of the first major support level at $10,585, Bitcoin rallied to a final hour intraday high at the level of $10,889.0.

Falling short of the first major resistance level at $10,915, Bitcoin eased back to end the day at sub-$10,860 levels.

The near-term bullish trend remained whole, in contempt of the latest pullback. For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to form a near-term bearish trend. At the hour of composing, Bitcoin was somewhere around 0.28% to the level of $10,826.0. It was a blended beginning to the day. Bitcoin rose to an early morning high $10,866.0 before tumbling to a low $10,826.0.

Bitcoin started the significant help and obstruction levels untested from the get-go. Somewhere else, it was a blended beginning to the day.

Bitcoin Cash ABC (+0.54%), Bitcoin Cash SV to the level (+0.62%), and Crypto.com Coin (+0.65%) evaded the pattern right off the bat.

It was a bearish beginning to the day for the remainder of the majors, in any case. Binance Coin was somewhere around 1.18% to lead the way down.

https://xtreamforex.com/nasdaq-futures-shows-the-short/

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