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USD/JPY Bulls Cautious

USD/JPY Bulls Cautious Near 159.00, Highest Since April Amid Intervention Fears

USD/JPY Bulls Cautious Near 159.00, Highest Since April Amid Intervention Fears

The USD/JPY pair is trading within a narrow range during the Asian session on Friday, consolidating recent gains near the 159.00 mark, the highest level since late April. The pair’s fundamental backdrop supports prospects for further appreciation, although fears of intervention might limit the upside.

The Japanese Yen (JPY) remains under pressure due to the Bank of Japan’s (BoJ) reluctance to commit to near-term interest rate hikes. Data released earlier on Friday showed that Japan’s core-core Consumer Price Index (CPI), which excludes food and energy prices, slowed for the ninth consecutive month, easing to a 2.1% yearly rate from 2.4%. This data increases uncertainty about whether the BoJ will raise interest rates in July or later in the year. Additionally, the prevailing bullish sentiment in global equity markets reduces demand for the safe-haven JPY, providing a tailwind for the USD/JPY pair.

On the other hand, the US Dollar (USD) remains strong near the top end of its weekly trading range following a sharp rise in US Treasury bond yields overnight. This has further widened the US-Japan rate differential, putting additional pressure on the JPY and supporting the USD/JPY pair. However, investors remain cautious amid speculations that Japanese authorities might intervene to support the domestic currency. Moreover, increasing bets on an imminent start to the Federal Reserve’s (Fed) rate-cutting cycle in September could limit further gains for the Greenback and the USD/JPY pair.

Despite these concerns, the USD/JPY pair is on track to end in positive territory for the second consecutive week. Investors are now looking forward to the release of global flash PMI prints for additional market direction. The upcoming US Existing Home Sales data, along with US bond yields and broader market risk sentiment, are also expected to provide short-term trading opportunities on the last day of the week.

Overall, while the USD/JPY pair has seen recent gains and stands at a significant level, the potential for intervention by Japanese authorities and the uncertain path of the BoJ’s monetary policy add layers of complexity to its future movements. Traders will need to stay vigilant to both Japanese economic indicators and broader market trends to navigate the near-term landscape effectively.

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GBP/USD Holds Steady at 1.2700, Awaits UK CPI Data

GBP/USD Holds Steady at 1.2700, Awaits UK CPI Data

GBP/USD Holds Steady at 1.2700, Awaits UK CPI Data

The GBP/USD pair is struggling to gain any significant traction on Wednesday, trading within a narrow range around the 1.2700 mark during the Asian session. Despite this, spot prices are holding above the one-month low reached last Friday, as traders eagerly anticipate the release of the latest UK consumer inflation figures before committing to any substantial moves.

The upcoming UK Consumer Price Index (CPI) data is expected to show a slight increase, with monthly inflation ticking up to 0.4% in May from 0.3% in April. However, the annual inflation rate is projected to decelerate to 3.5% from the previous 3.9%. This data will be crucial in shaping market expectations for the British Pound (GBP) and could provide the necessary impetus for the GBP/USD pair to break out of its current trading range.

In addition to the inflation data, market participants are also focusing on the Bank of England’s (BoE) monetary policy meeting scheduled for Thursday. The decisions and guidance provided by the BoE will play a significant role in determining the near-term trajectory of the GBP/USD pair. Any indications of future rate hikes or a shift in the bank’s policy stance could lead to increased volatility and directional movement in the currency pair.

On the other side of the Atlantic, subdued price action in the US Dollar (USD) is also influencing the GBP/USD pair. Tuesday’s US Retail Sales report came in softer than expected, signaling potential fatigue among American consumers. This has reinforced market expectations that the Federal Reserve (Fed) may start cutting interest rates as early as September. Consequently, US Treasury bond yields have declined, undermining the USD and providing a supportive backdrop for the GBP/USD pair.

Despite these supportive factors, the GBP/USD pair has yet to attract significant follow-through buying. This cautious market sentiment is likely due to the looming uncertainty surrounding the key economic data and central bank meetings. Traders appear hesitant to position themselves aggressively before gaining more clarity from the upcoming UK CPI release and BoE meeting.

In summary, while the GBP/USD pair holds steady above its recent lows and is supported by a softer USD and positive expectations from the UK inflation data, the lack of decisive movement suggests that market participants are awaiting further confirmation from key economic events. The UK CPI data and the BoE’s policy decisions will be critical in providing direction for the GBP/USD pair in the coming days. Until then, the pair is likely to remain range-bound, oscillating around the 1.2700 level.

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EUR/USD Consolidates Near 1.0700

EUR/USD Consolidates Near 1.0700 After Recent Low

EUR/USD Consolidates Near 1.0700 After Recent Low

The EUR/USD pair starts the week on a subdued note, consolidating its recent losses to the lowest level since early May, around the 1.0670-1.0665 region touched on Friday. Currently trading around the 1.0700 mark, the pair appears vulnerable to further declines.

Concerns over a potential snap election in France, which could worsen the fiscal situation in the Eurozone’s second-largest economy, continue to weigh on the shared currency. The right-wing National Front party leads in the polls, and French Finance Minister Bruno Le Maire warned on Friday of a financial crisis risk if either the far right or left won due to their heavy spending plans. This, coupled with a modest uptick in the US Dollar (USD), supports a near-term negative outlook for the EUR/USD pair.

The Federal Reserve’s (Fed) hawkish surprise at the end of the June policy meeting, indicating a median projection of just one rate cut in 2024, supports elevated US Treasury bond yields. Additionally, ongoing geopolitical tensions in the Middle East bolster the safe-haven Greenback, suggesting a downward trend for the EUR/USD pair. However, signs of easing inflationary pressures in the US keep the door open for a potential interest rate cut by the Fed in September.

This outlook was reinforced by US data released on Friday, showing an unexpected drop in import prices in May, further boosting the domestic inflation outlook. Additionally, a survey by the University of Michigan revealed a sharp deterioration in US consumer sentiment in June, which might prevent USD bulls from placing aggressive bets and help limit losses for the EUR/USD pair. With no relevant US economic data due for release on Monday, the pair remains at the mercy of the USD.

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EUR/USD Declines for Third Consecutive Day

EUR/USD Declines for Third Consecutive Day Ahead of Fed Rate Decision

EUR/USD Declines for Third Consecutive Day Ahead of Fed Rate Decision

The EUR/USD experienced its third consecutive day of losses on Tuesday as market sentiment soured following the European Union parliamentary elections. The elections resulted in a significant shift towards center-right and far-right parties, with European voters showing strong support for these groups. Meanwhile, left-leaning political parties suffered steep losses, reflecting widespread dissatisfaction among EU citizens regarding economic fragility and the current policy strategies of the established European ruling parties.

This political upheaval in Europe has added to the market’s uncertainty. Investors are now anxiously awaiting key economic updates from the United States. On Wednesday, the US Consumer Price Index (CPI) inflation data and the latest Federal Reserve (Fed) rate decision are due to be released. These announcements are expected to have a significant impact on market sentiment, which is currently quite volatile.

The US CPI inflation data is anticipated to show a cooling in April, with expectations of a 0.1% month-over-month increase compared to the previous month’s 0.3%. Annualized Core CPI inflation is also expected to tick down slightly to 3.5% year-over-year, from the previous 3.6%. These figures are critical as they will provide insight into the inflationary pressures facing the US economy and inform the Fed’s future policy decisions.

In addition to the CPI data, the Fed’s latest rate call and Monetary Policy Statement are set to draw significant attention. Although the Fed is broadly expected to hold interest rates steady this week, investors are particularly interested in updates to the Fed’s “dot plot” – a summary of interest rate expectations going forward. There is growing concern that the dot plot may shift, reflecting fewer or no rate cuts in 2024, which could have substantial implications for market dynamics.

The possibility of a significant adjustment in the Fed’s rate expectations has added to the market’s anxiety. Investors are increasingly worried that the Fed might signal a more hawkish stance, potentially indicating that the anticipated rate cuts in 2024 might not materialize. This scenario could further pressure the EUR/USD, which has already been affected by the recent political shifts in Europe and ongoing economic uncertainties.

As the market prepares for these pivotal announcements, the EUR/USD will likely remain under scrutiny. The combination of political instability in the EU and critical economic updates from the US sets the stage for continued volatility. Investors will be closely monitoring the outcomes of Wednesday’s data releases and the Fed’s communications for any indications of future policy directions.

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GBP/USD Defensive Below

GBP/USD Defensive Below 1.2750 Amid Stronger USD

GBP/USD Defensive Below 1.2750 Amid Stronger USD

During the early Asian trading hours on Monday, the GBP/USD pair recovered some of its lost ground, hovering around 1.2725. However, the upside for GBP/USD might be limited due to lower expectations of US Federal Reserve (Fed) rate cuts this year, following stronger-than-expected US Nonfarm Payrolls (NFP) data. Investors are now turning their attention to the UK employment data for May, which is scheduled for release on Tuesday. Additionally, key events on the US economic calendar this week include the Consumer Price Index (CPI) and the Federal Reserve’s interest rate decision, which will be closely watched by the market.

On Friday, the US Nonfarm Payrolls report revealed a substantial increase of 272,000 jobs in May, up from a 165,000 rise in April and significantly above the market consensus of 185,000. Despite this strong job growth, the Unemployment Rate edged up to 4.0% in May from 3.9% in April. Average Hourly Earnings also showed an impressive year-over-year increase of 4.1% in May, revised up from 3.9% in April, and surpassing the estimated 3.9%. These figures, released by the US Bureau of Labor Statistics, highlight the robustness of the US labor market.

The solid employment data has led to a reassessment of future monetary policy moves by the Federal Reserve. The likelihood of a rate cut before September has diminished, with futures traders seeing almost no chance of such a move, according to data from CME Group. This higher-for-longer rate outlook is expected to provide support for the US Dollar (USD) in the near term.In contrast, the focus in the UK will be on the employment data set to be released on Tuesday. This includes the Claimant Count Change, Employment Change, and Average Earnings data. Any indication of increased layoffs could prompt expectations of early rate cuts by the Bank of England (BoE), which would likely weaken the Pound Sterling (GBP).

The market’s attention is also on the upcoming US CPI data and the Federal Reserve’s interest rate decision. The CPI data will offer insights into the inflationary pressures in the US economy, while the Fed’s decision will provide guidance on the future path of interest rates. These events are crucial for the USD’s performance and, by extension, the GBP/USD pair’s movement.Overall, while the GBP/USD pair has shown some recovery, its upside potential may be constrained by the current economic data and central bank policies. Investors will be closely monitoring the UK employment report and the US CPI and Fed announcements for further direction.

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USD/CAD Holds Above Mid-1.3600s Ahead of US NFP

USD/CAD Holds Above Mid-1.3600s Ahead of US NFP

USD/CAD Holds Above Mid-1.3600s Ahead of US NFP

The USD/CAD pair is showing resilience below the 200-hour Simple Moving Average (SMA), but it seems to struggle to attract any significant buyers during the Asian session on Friday. Currently, spot prices trade with a mild positive bias, hovering around the 1.3670 area. Traders are keenly awaiting the release of the US monthly employment details before making fresh directional bets.

The much-anticipated Nonfarm Payrolls (NFP) report is expected to reveal that the US economy added 185,000 jobs in May, up from 175,000 in the previous month. Additionally, the unemployment rate is projected to hold steady at 3.9%. This data, along with Average Hourly Earnings, will play a crucial role in shaping the inflation outlook and the Federal Reserve’s future policy decisions. Consequently, this will influence the demand for the US Dollar (USD) and provide fresh directional impetus to the USD/CAD pair.

As the market heads into this key data risk, participants have been pricing in a higher probability that the Federal Reserve will begin cutting interest rates in September due to signs of a slowdown in the US economy. This expectation has kept US Treasury bond yields and the USD under pressure. Moreover, this week’s rebound in Crude Oil prices has supported the commodity-linked Canadian Dollar (CAD), further capping the USD/CAD pair’s upside.

Meanwhile, the Bank of Canada (BoC) recently lowered its benchmark rate for the first time in four years, from a more than two-decade high, expressing concerns about slowing economic growth. The central bank also acknowledged improvements in underlying inflation, fueling speculations about another rate cut next month. This development could limit the Canadian Dollar’s gains and act as a supportive factor for the USD/CAD pair.

Given the mixed fundamental backdrop, aggressive traders should exercise caution, as the USD/CAD pair is more likely to continue its range-bound price action on the last trading day of the week. Despite this, spot prices remain on track to register modest weekly gains, although they stay within a familiar range held since early May.

In summary, the USD/CAD pair remains resilient below the 200-hour SMA but struggles to attract substantial buyers ahead of the US NFP report. The anticipated employment data will significantly influence USD demand and the pair’s direction. While market participants expect a Fed rate cut in September, supporting the CAD, the BoC’s recent rate cut and potential for another could cap the CAD’s upside, providing a mixed outlook for the USD/CAD pair. As such, the pair is likely to maintain its range-bound movement, with modest gains expected for the week.

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Japanese Yen Weakens as Investors Await Key US Data

Japanese Yen Weakens as Investors Await Key US Data

Japanese Yen Weakens as Investors Await Key US Data

On Wednesday, the Japanese Yen (JPY) edged lower as investors exercised caution ahead of crucial US economic data releases, including the US ADP Employment Change and the ISM Services PMI reports. Market participants are also looking ahead to the Nonfarm Payrolls (NFP) report, set to be released on Friday, which could further influence the currency markets.

The JPY is under pressure due to the interest rate differential between the United States and Japan, which favors the US Dollar (USD) over the Yen. The USD/JPY pair is buoyed by this rate disparity, which makes the USD more attractive to investors. However, the potential for significant gains in the USD/JPY pair is tempered by recent positive economic data from Japan.

On Wednesday, the Jibun Bank Japan Services PMI was revised upwards to 53.8 in May, from an initial reading of 53.6. Although this revision indicates an improvement, it still falls short of April’s eight-month peak of 54.3, suggesting the slowest growth in the Japanese service sector since February. 

Additionally, Japan’s Labor Cash Earnings surged by 2.1% year-on-year in April, surpassing forecasts of a 1.7% increase and marking the highest growth rate since June of the previous year. These stronger-than-expected figures offer some support to the JPY and could limit the upside potential of the USD/JPY pair.

Meanwhile, the US Dollar Index (DXY), which measures the value of the USD against a basket of six major currencies, has edged higher, bolstered by rising US Treasury yields. However, the weaker US Manufacturing PMI for May has sparked speculation about a potential rate cut by the US Federal Reserve (Fed). This softer-than-expected manufacturing data has led traders to price in nearly 64.9% odds of a Fed rate cut of at least 25 basis points by September, a notable increase from 46.3% just a week earlier, according to the CME FedWatch Tool.

The upcoming US ADP Employment Change and ISM Services PMI reports are expected to provide further insights into the health of the US economy. Stronger-than-expected data could reinforce the USD’s strength and put additional pressure on the JPY. Conversely, weaker data could heighten expectations for a Fed rate cut, potentially providing some relief to the Yen.

In conclusion, while the Japanese Yen is facing downward pressure due to the interest rate differential between the US and Japan, recent positive economic data from Japan and the potential for a Fed rate cut could influence the USD/JPY pair’s movements in the coming days. Investors will be closely monitoring the upcoming US economic data releases and the Nonfarm Payrolls report for further direction.

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Gold Price Consolidates Below $2,750 Amid Mixed Market Signals

Gold Price Consolidates Below $2,750 Amid Mixed Market Signals

Gold prices (XAU/USD) continue to trade within a narrow range near the $2,740 level during early European trading on Tuesday. The market remains influenced by conflicting factors, leaving traders hesitant to make strong directional moves.

US President Donald Trump’s renewed trade tariff threats have sparked inflationary concerns, driving a modest rebound in US Treasury bond yields. This, in turn, supports a recovery in the US Dollar (USD) from its recent one-month low, creating downward pressure on gold prices.

However, fears of potential economic disruptions from Trump’s trade policies are providing support for the safe-haven asset, helping limit its downside. Market participants are also exercising caution ahead of the upcoming two-day Federal Open Market Committee (FOMC) meeting, while US macroeconomic data due later in the day could further influence market sentiment.

Key Developments Impacting Gold Prices

  1. Trade Tariff Concerns:
    President Trump recently announced emergency tariffs of 25% on Colombian imports, though implementation was delayed following an agreement on the acceptance of illegal migrants returned from the US. Trump also signaled impending tariffs on pharmaceuticals, computer chips, aluminum, copper, and potentially steel. These moves have heightened fears of inflation and pushed US Treasury bond yields higher, bolstering the USD and weighing on gold.
  2. Monetary Policy Speculation:
    Despite Trump’s tariff announcements, markets are pricing in two potential 25-basis-point interest rate cuts by the Federal Reserve this year. This expectation could cap bond yields and limit USD gains, offering some support to gold prices.
  3. Data and Events to Watch:
    Later on Tuesday, US economic data such as Durable Goods Orders, the Conference Board’s Consumer Confidence Index, and the Richmond Manufacturing Index may provide additional trading cues. The spotlight will then shift to Wednesday’s FOMC decision, which could significantly impact USD dynamics and set the tone for gold’s next directional move.

Technical Outlook: Resistance and Support Levels

Gold prices showed resilience on Monday, holding above the 23.6% Fibonacci retracement level of the December-January uptrend. Daily chart oscillators remain in positive territory, reinforcing the case for an upward bias.

  • Support Levels:
    Immediate support lies near $2,730, followed by the $2,725-2,750 zone. A break below these levels could push prices toward the 38.2% Fibonacci retracement level near $2,707-2,705, and further to the 50% level around $2,684.
  • Resistance Levels:
    The nearest resistance is at $2,755-2,757, with further hurdles at $2,772-2,773 and $2,786. A decisive break above $2,800 would signal renewed bullish momentum, potentially leading to a test of the all-time high near $2,790 and further gains.

Outlook for Gold

Gold prices remain range-bound as traders weigh opposing forces of inflationary concerns and safe-haven demand. A move above $2,755-2,757 is necessary for bulls to regain control in the short term, while a break below $2,730 would signal deeper corrections. With critical economic data and the FOMC decision on the horizon, gold’s next big move may hinge on shifting market dynamics in the coming days.

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Supermicro Stock Skyrockets 29% After Investigation Clears Fraud Allegations

Super Micro Computer (NASDAQ: SMCI), popularly known as Supermicro, saw its stock price soar by 29% on Monday, closing around $42 per share. This significant jump follows the conclusion of a governance investigation that found no evidence of fraud or misconduct, boosting investor confidence.

Investigation Findings: No Fraud or Misconduct

The investigation, initiated by a special committee in August, addressed concerns raised by Ernst & Young (EY), Supermicro’s former auditor, regarding governance, sales practices, and financial reporting. Key findings include:

  1. Management Integrity: The committee found no substantial concerns regarding the integrity of Supermicro’s senior management, audit committee, or financial reporting practices.
  2. Audit Independence: The audit committee demonstrated appropriate independence and oversight during financial reporting.
  3. Rehiring Practices: The company’s decision to rehire certain employees was deemed consistent with a commitment to legal compliance and accurate financial reporting.

EY’s concerns were ultimately found unsupported, with the committee emphasizing the accuracy of interim and final findings.

Governance Overhaul and Next Steps

To strengthen its governance, Supermicro has embraced the committee’s recommendations, including:

  • Leadership Appointments: Hiring a new Chief Financial Officer (CFO), appointing Kenneth Cheung as Chief Accounting Officer, and recruiting a Chief Compliance Officer and General Counsel.
  • Enhanced Oversight: Improving internal accounting and compliance systems, with better training, monitoring, and oversight practices.

The company has also filed a compliance plan with Nasdaq to catch up on overdue financial reports, ensuring continued listing.

Stock Performance: Recovery in Progress

Supermicro’s stock had plummeted by 85% in mid-November, hitting $17 per share, following its October 10-for-1 stock split and governance concerns. However, confidence rebounded after the investigation’s positive findings. Since November 15, the stock has surged back to $42, marking a 48% year-to-date increase.

With a price-to-earnings (P/E) ratio dropping from 79 in March to 16, Supermicro’s valuation is now drawing comparisons to AI-driven market leaders like NVIDIA. Its focus on AI-enabled servers for high-performance computing positions it as a key player in the tech sector.

Investor Considerations

While the governance investigation cleared Supermicro of fraud, investors are advised to exercise caution until the company releases its delayed financial reports. These filings will provide deeper insights into its financial health and help solidify its recovery. For now, Supermicro’s low valuation and strong earnings potential make it a compelling, albeit cautious, investment opportunity.

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Asian Stocks Decline on Geopolitical Tensions; Nikkei Falls on Inflation Data

Asian Stocks Drop Amid Geopolitical Tensions; Nikkei Slides on Strong Inflation Data

Asian Stocks Drop Amid Geopolitical Tensions; Nikkei Slides on Strong Inflation Data

Asian equities fell on Friday as geopolitical concerns and strong economic data from Japan weighed on sentiment. The escalation of the Russia-Ukraine conflict further dampened risk appetite, while China’s tech sector provided a rare bright spot amid easing regulatory fears.

Key Market Highlights

Geopolitical Tensions Weigh on Markets
Russia intensified its attacks on Ukraine, targeting energy infrastructure and escalating the conflict. President Vladimir Putin issued threats to strike decision-making centers in Kyiv with ballistic missiles, exacerbating global geopolitical uncertainty.

Broad Declines Across Asia

  • Thailand’s SET Index: Dropped 0.2%.
  • Indonesia’s Jakarta Composite: Declined 0.8%.
  • South Korea’s KOSPI: Fell nearly 2%, driven by a 1.8% drop in Samsung Electronics and a 0.7% decline in SK Hynix. Concerns over slowing economic growth deepened after data showed declines in industrial output, retail sales, and facility investment in October.
  • Australia’s ASX 200: Edged 0.3% lower.
  • Malaysia’s KLCI: Dipped 0.2%.

Japan’s Nikkei Slips Amid Yen Strength
Japan’s Nikkei 225 fell 0.5%, and the TOPIX index declined 0.3% as the yen strengthened to a one-month high against the U.S. dollar. Strong inflation data from Tokyo fueled speculation of a Bank of Japan (BOJ) rate hike in December.

  • Tokyo’s core consumer prices exceeded expectations in November, highlighting persistent inflationary pressures.
  • BOJ Governor Kazuo Ueda signaled plans to tighten monetary policy further, supported by a “virtuous cycle” of rising wages and steady inflation.

Chinese Tech Stocks Buck the Trend
Contrary to broader declines, Chinese equities rallied:

  • Shanghai Shenzhen CSI 300: Rose 1.6%.
  • Shanghai Composite: Gained 1.4%.
  • Hang Seng Index: Jumped 1.3%.

Reports suggested that the U.S. may impose less severe sanctions on China’s semiconductor industry than initially feared.

  • Semiconductor Manufacturing International Corp (SMIC) surged over 4%.
  • Hua Hong Semiconductor climbed 3.7%.

Investors are optimistic about Beijing’s recent stimulus measures, and a Reuters poll anticipates modest growth in China’s manufacturing Purchasing Managers’ Index for November, due Saturday.

Outlook

The Asia-Pacific region remains under pressure from geopolitical risks and mixed economic signals. Japan’s inflation dynamics could shift BOJ policy, while China’s tech rally might offer temporary relief amid broader concerns of an economic slowdown.

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WTI Steady at $69 Amid Geopolitical Risks and US Crude Inventory Build

WTI Steadies Near $69.00 Amid Mixed Signals from Geopolitical Risks and US Crude Inventory Build

WTI Steadies Near $69.00 Amid Mixed Signals from Geopolitical Risks and US Crude Inventory Build

West Texas Intermediate (WTI), the US benchmark for crude oil, is trading near $68.95 during Thursday’s session, maintaining a steady stance amid conflicting market drivers. A modest build in US crude inventories and weak Chinese demand weigh on prices, while escalating geopolitical tensions between Russia and Ukraine offer potential support.

US Crude Inventory Build Weighs on Prices
The Energy Information Administration (EIA) reported an increase of 0.545 million barrels in US crude stockpiles for the week ending November 15, slightly above market expectations of a 0.400 million barrel rise but significantly lower than the previous week’s 2.089 million barrel build. The smaller-than-expected inventory increase adds mild pressure to oil prices.

Weak Chinese Demand Adds Downside Pressure
China’s demand for crude oil continues to show weakness, dampening the outlook for global consumption. In October, China’s crude oil demand fell by 5.4% year-on-year. The International Energy Agency (IEA) projects demand growth in China to reach just 140,000 barrels per day (bpd) for 2024, a sharp decline compared to the 1.4 million bpd growth seen in 2023.

Geopolitical Risks Provide Support
Heightened geopolitical tensions involving major oil producers Russia and Ukraine are keeping supply-side concerns alive. This week, Russia accused Ukraine of targeting a facility in the Bryansk region with ATACMS missiles, prompting Russian President Vladimir Putin to lower the threshold for a potential nuclear response. Such risks could disrupt oil supplies, offering a counterbalance to bearish demand factors.

John Kilduff, a partner at Again Capital, highlighted, “These risks to supply are definitely keeping the support here and offsetting to a degree concerns around the global demand outlook.”

Outlook
WTI prices remain at the mercy of mixed signals, with inventory builds and sluggish Chinese demand capping gains while geopolitical risks lend underlying support. Traders will look toward further updates on geopolitical developments and upcoming economic data to gauge the balance between supply and demand factors in the oil market.

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Gold Prices Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold Prices Remain Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold Prices Remain Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold (XAU/USD) continues to trade lower for the second consecutive session on Thursday, impacted by a stronger U.S. Dollar following former President Donald Trump’s victory in the recent U.S. election. The dollar-denominated precious metal is seeing diminished safe-haven appeal as market optimism increases, supported by clearer political outcomes.

Investor focus is now on the upcoming U.S. Federal Reserve decision, with markets largely anticipating a 25 basis-point rate cut. If realized, this could offer some support for Gold, as lower interest rates tend to reduce the opportunity cost of holding non-yielding assets like precious metals. The CME FedWatch Tool currently indicates a 98.1% likelihood of this modest rate reduction.

Market Dynamics: Gold Struggles Amid Higher Yields and “Trump Trades”

Non-yielding Gold faces additional pressure from surging U.S. Treasury yields, with the 2-year and 10-year bond yields hitting 4.31% and 4.47%, respectively, their highest levels since July. Furthermore, the prospect of increased inflation due to Trump’s policy stance, which includes higher trade tariffs and fiscal spending, could prompt some investors to seek Gold as a long-term inflation hedge.

Trump’s proposed economic policies—such as imposing tariffs, expanding the fiscal deficit, and cutting taxes—might conflict with the Federal Reserve’s inflation control goals, likely resulting in a slower pace of monetary easing.

Gold prices have been relatively unaffected by ongoing geopolitical tensions, including Iran’s warning of potential retaliation against Israel’s recent actions.

Additionally, mixed U.S. economic data from this week’s ISM and PMI releases reflect a resilient services sector. The ISM Services PMI rose to 56.0 in October from 54.9 in September, exceeding forecasts, while the S&P Global Services PMI reported a slight dip, coming in at 55.0.

Technical Outlook: Key Support and Resistance Levels for Gold

Gold currently trades near $2,650 per ounce, with technical indicators suggesting a continuation of bearish momentum. On the daily chart, Gold remains below the nine- and 14-day Exponential Moving Averages (EMAs), and the 14-day Relative Strength Index (RSI) remains under 50, both indicating a bearish trend.

On the downside, the next support level sits around $2,603.53, representing a three-week low. A break below this level could push Gold toward the critical $2,500 mark.

Conversely, immediate resistance is found near the psychological level of $2,700, with further resistance at the nine-day EMA of $2,711.40. A breakout above this zone could position Gold to retest its recent high of $2,790.11 reached on October 31.

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Gold Price Holds Steady Near Record High, Awaits US Macro Data for Direction

Gold Price Holds Steady Near Record High, Awaits US Macro Data for Direction

Gold price (XAU/USD) remains robust as it approaches the European session on Tuesday, trading just above the $2,750 mark and close to last week’s all-time high. Geopolitical risks and political uncertainties in the US continue to boost demand for the safe-haven metal. Additionally, lower US Treasury yields and cautious market sentiment lend further support to gold.

At the same time, expectations for smaller Federal Reserve (Fed) rate cuts are expected to support US bond yields, which could help the US Dollar (USD) recover some of the previous session’s losses. This, in turn, tempers new bullish momentum in non-yielding gold as investors await key US economic data releases this week, likely to influence the Fed’s rate outlook and provide new direction for XAU/USD.

Market Movers: Gold Supported by Mixed Factors, USD Buying Limits Gains

The retreat in US Treasury yields led to an intraday pullback in the USD from recent highs, encouraging some dip-buying near $2,725 early this week. Recent positive US data dampened expectations for substantial Fed rate cuts, potentially bolstering bond yields amid concerns about deficit spending after the November 5 election. With the US election drawing near, markets face additional uncertainty as Vice President Kamala Harris and Republican candidate Donald Trump engage in a close race for the presidency. Moreover, heightened tensions in the Middle East have added to market caution, with the US warning Iran of potential consequences if it continues retaliatory strikes.

In the broader market, China reported an 11.18% decline in gold consumption year-over-year for the first three quarters, citing high prices as a dampening factor on jewelry demand. Investors now eye the upcoming US Consumer Confidence Index and Job Openings and Labor Turnover Survey (JOLTS) for insight into the Fed’s rate plans and USD dynamics, likely to affect short-term gold price movements.

Technical Outlook: Gold Awaits Breakout for Bulls to Regain Control

On the technical front, a sustained move above the $2,750 resistance could trigger further buying interest, pushing gold prices past the all-time high around $2,759 and towards the four-month-old ascending trend-line resistance at $2,770–2,775. A continued rally could eventually target the psychological $2,800 level.

However, the Relative Strength Index (RSI) on the daily chart is approaching overbought levels, signaling potential caution for bulls. A short-term consolidation or minor pullback could provide a better entry for additional upside.

If a corrective decline occurs, support could emerge near the $2,725 level, followed by $2,715—the lower boundary of a recent trading range. A decisive break below this range might prompt technical selling, potentially leading gold prices below $2,700 and toward the $2,675 and $2,657–2,655 support areas.

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WTI Struggles Below $70 Amid Demand Concerns and USD Strength

WTI Struggles Below $70 Amid Demand Concerns and USD Strength

WTI Struggles Below $70 Amid Demand Concerns and USD Strength

West Texas Intermediate (WTI) crude oil prices are hovering just below the $70.00 mark during Tuesday’s Asian session, remaining in a tight range around $69.70-$69.75. The commodity has struggled to build on the previous day’s modest gains and stays near the three-week low it touched last Friday. WTI seems vulnerable to continuing its recent downtrend, which has persisted for over two weeks.

The brief positive reaction to the People’s Bank of China’s (PBOC) interest rate cut on Monday was short-lived, as concerns about slowing demand, particularly from China, continued to weigh on oil prices. Both OPEC and the International Energy Agency (IEA) reduced their global demand forecasts last month due to economic challenges in China, the world’s largest oil importer. IEA chief Fatih Birol further fueled these concerns, warning that China’s economic weakness could dampen global oil demand for years to come.

Adding to WTI’s challenges, the US Dollar (USD) has surged to its highest level since early August, driven by expectations of more cautious monetary easing from the Federal Reserve (Fed). A stronger USD tends to weigh on oil prices by making crude more expensive for holders of other currencies.

However, the potential for further escalation in the Middle East conflict, which could disrupt oil supplies from the region, provides some support to WTI prices. This geopolitical risk cautions against overly bearish positions, despite the recent sharp drop from the nearly two-month high of $78.00 reached on October 8.

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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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US Election Uncertainty Begins to Impact Forex Markets

US Election Uncertainty Begins to Impact Forex Markets

US Election Uncertainty Begins to Impact Forex Markets

Currency markets are beginning to react to the forthcoming U.S. election, with signs of increased foreign exchange volatility evident six months prior to the November 5 vote. Notably, this heightened anxiety is manifesting in the options market, particularly concerning the Chinese offshore yuan.

On Tuesday, the difference between six-month and three-month implied volatility for the yuan escalated sharply, marking a significant increase from the prior Friday. This spread reached 1.20 percentage points, a substantial jump from 0.73, representing the most significant rise since such records began in 2011.

Market dynamics suggest that traders are preparing for a “binary scenario” depending on the election outcome. A victory for Donald Trump could trigger significant volatility and a sharp decline in the offshore yuan, echoing the market’s response in 2016 when Trump first ran for president. During that election, the Mexican peso became a focal point for assessing currency-market sentiment, experiencing heightened volatility following Trump’s victory.

Currently, it appears the Chinese yuan may play a similar role to the peso in 2016, putting options traders on high alert. The spread between six-month and three-month volatility, with the former spanning the election date and the latter expiring in August, highlights the market’s significant apprehension about the election’s effect on currency fluctuations.

Political risks for the Chinese yuan are particularly acute, possibly due to Trump’s previous threats to impose steep tariffs, potentially as high as 60%, on Chinese imports. Such a scenario could drastically alter trade dynamics, potentially driving the yuan to fluctuate between 7.7 and 8.3 against the dollar in a severe decoupling scenario.

Concerns are not limited to the yuan. The Mexican peso and the euro are also experiencing shifts in volatility. The peso’s six- to three-month volatility spread has widened significantly, though it remains below its yearly high. The euro’s volatility spread has reached levels last seen in November 2021.

Trump’s broader trade policy proposals, including a potential 10% tariff on all foreign imports, have stirred further market unease. Christine Lagarde, President of the European Central Bank, has cautioned Europe to brace for possible tariffs and challenging decisions ahead.

In light of these developments, financial strategists like Meera Chandan from JPMorgan & Chase Co. are advising a cautious approach to currency investments, recommending a reduction in dollar positions while still maintaining some exposure through options as a protective measure against ongoing market uncertainties.

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Australian Dollar Falls as RBA Holds Interest Rate at 4.35%

Australian Dollar Falls as RBA Holds Interest Rate at 4.35%

Australian Dollar Falls as RBA Holds Interest Rate at 4.35%

The Australian Dollar (AUD) saw its recent rally come to a halt on Tuesday, following the Reserve Bank of Australia’s (RBA) decision to maintain the official cash rate at 4.35%. This decision came despite market anticipation of a possible shift towards a more aggressive monetary policy, spurred by recent inflation figures surpassing expectations.

Last week’s inflation data indicated a sustained price increase, leading to speculation that the RBA might consider tightening its monetary policy. However, the latest decision to keep interest rates steady suggests a cautious approach by the central bank amidst ongoing economic uncertainties.

Inflation dynamics in Australia have been intriguing, with the Consumer Price Index (CPI) showing a decrease in inflation during the first quarter—marking the fifth consecutive quarter of deceleration. Despite this trend, inflation rates still exceeded initial forecasts. Adding to the complexity, Australia’s monthly CPI for March showed an unexpected surge, contrasting sharply with forecasts that had predicted stable prices. This resurgence in inflation has added to the speculation about the future direction of monetary policy.

Simultaneously, the US Dollar (USD) is experiencing volatility. The US Dollar Index (DXY), which measures the USD’s strength against six major currencies, has been under pressure following the release of weaker-than-expected US labor market data. The soft employment figures from the US have dampened the dollar’s strength and revived expectations that the Federal Reserve might implement interest rate cuts in 2024 to support economic growth.

This backdrop of fluctuating economic indicators and uncertain fiscal policies is shaping the global currency markets. For the Australian Dollar, the RBA’s decision to hold rates steady is a significant factor that could influence its short-term movements against major currencies. Market participants will continue to scrutinize domestic economic data and global economic trends closely, as these will play crucial roles in shaping the central bank’s policy outlook in the coming months.

Overall, while the Australian Dollar paused its upward trajectory, the broader financial landscape remains dynamic, with various international factors influencing currency valuations and monetary policy decisions globally.

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Treasury Rally Faces $125B Barrier

Treasury Rally Faces $125B Barrier

Treasury Rally Faces $125B Barrier

Bond traders welcomed signs of a cooling US labor market, sparking a surge in US Treasuries on Friday. The government report indicating unexpected softness in job and wage gains last month contributed to a late-week rally, which began after Federal Reserve Chair Jerome Powell hinted at potential rate cuts in response to evolving data.

Investors are cautiously increasing their bets on easing measures this year, particularly on two-year notes, as evidence of economic deceleration mounts. However, despite concerns over slowing growth, inflation remains persistent, potentially constraining the Fed’s policy options and keeping bond yields within recent ranges.

The upcoming auctions of $67 billion in 10- and 30-year Treasury securities next week will gauge demand for longer-dated debt, which has faced skepticism from some investors. Additionally, $58 billion of three-year notes will be sold as part of the quarterly refunding auctions.

Mark Lindbloom, a portfolio manager at Western Asset Management, believes shorter-term securities like two- and five-year notes will outperform longer-term debt, despite the relief provided by the jobs report and Powell’s comments.

Powell reiterated the Fed’s readiness to respond to signs of weakening job creation and wages, underscoring the dovish stance following Friday’s employment data. Market reactions saw the US two-year yield dropping to 4.7%, significantly lower than its recent peak, indicating expectations for multiple rate cuts this year.

George Catrambone of DWS Americas favors owning two-year notes given the remote probability of rate hikes. However, concerns persist regarding longer-dated debt, especially if inflation remains above the Fed’s target and government spending increases.

Jennison Associates, overseeing $50 billion in fixed income assets, advocates a steepening trade strategy, overweighting shorter-term Treasuries while underweighting the 10-year note. They anticipate a steeper yield curve if the Fed initiates cuts and the market prices in further easing on softer data.

Overall, while the two-year yield is expected to decline further, uncertainty remains regarding the attractiveness of longer-dated debt amid inflation concerns and potential Fed actions.

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Oil Industry Flush with Cash Shows Reduced Appetite for Debt

Oil Industry Flush with Cash Shows Reduced Appetite for Debt

Oil Industry Flush with Cash Shows Reduced Appetite for Debt

In the last year, the oil industry witnessed a significant decline in profits compared to previous years, with a notable decrease across the board in oil and gas companies as prices dropped due to diminished concerns over supply security. Despite these lower profits, the industry maintained high levels of cash reserves, leading to a reduced need for borrowing.

Bloomberg recently reported a 6% decrease in loan demand from the oil and gas sector in the past year, following a 1% decrease the year before. This trend is remarkable given that, during the earlier period, oil and gas producers had accumulated substantial cash reserves amid global fears of potential shortages. The recent reduction in borrowing demand was even more significant given the simultaneous drop in profits.

The industry has seen its net debt to earnings ratio before interest, tax, depreciation, and amortization shrink dramatically from 2.4 in 2020 to 0.8 last year. Analysts predict this ratio could fall below zero by 2030, potentially positioning the oil and gas sector as an attractive investment due to its unique financial structure.

Despite these strong financial indicators, concerns arise regarding the industry’s compatibility with global energy transition goals. Major banks have been scaling back their engagements with oil and gas companies to align with environmental initiatives. However, the industry’s financial independence suggests it can sustain and even expand without reliance on these major financial institutions. This has been evidenced by smaller, regional U.S. banks increasing their lending to the sector by up to 70% between 2022 and 2023, even as larger banks reduced their exposure.

Critics, including climate activists, argue that the persistent demand for fossil fuels, which contradicts many existing forecasts, underscores potential flaws in these projections. The ongoing financial robustness of oil and gas companies highlights their ability to reduce dependency on borrowed capital, which some believe casts doubt on the effectiveness of strategies aimed at limiting fossil fuel consumption through financial channels.

This development poses challenges for banks that have withdrawn from the sector to support environmental goals, suggesting that their efforts may have limited impact on the industry’s operations. This scenario reflects a broader resilience in oil demand, emphasizing the difficulty of curbing it by merely restricting supply.

Former Shell CEO Ben van Beurden has previously articulated this point, noting that reducing supply—such as ceasing the sale of petrol and diesel—would not decrease global demand or carbon emissions significantly. Consumers would simply seek alternative suppliers.

The current financial autonomy of oil and gas producers allows them to plan production increases based on market demand without the need for external funding. This autonomy and resilience to external pressures underscore the industry’s capacity to operate independently, highlighting a market-driven approach to production that could continue to challenge environmental and banking strategies aimed at reducing fossil fuel reliance.

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Japan's FX Intervention Marks ¥160 Threshold

Ex-Official: Japan’s FX Intervention Marks Threshold

Ex-Official: Japan’s FX Intervention Marks ¥160 Threshold

Columbia University academic and former finance ministry executive Takatoshi Ito indicated that Japanese authorities likely intervened in the currency market, viewing ¥160 to the dollar as a critical threshold. Ito, who has connections with former and current Japanese policymakers, suggested that interventions aim to curb speculative trading and set market expectations that the dollar might not rise beyond ¥160 against the yen.

Japan’s financial officials are believed to have intervened in the foreign exchange market multiple times this week to stabilize the yen and avoid sharp declines that could harm the economy.

Ito mentioned that the Bank of Japan (BOJ) might consider raising interest rates to 0.5% by the year’s end if the yen’s depreciation continues to fuel inflation. He explained that gradual declines in the yen, in line with interest rate differentials, are challenging to reverse with interventions alone. However, significant ongoing weakness in the yen could lead to inflationary pressures, potentially prompting the BOJ to implement two rate hikes by the end of the year. The earliest of these increases could occur this autumn.

Looking ahead, Ito wouldn’t be surprised if the BOJ’s policy rate approached 2% over the medium term, assuming the central bank achieves its 2% inflation target and the economy remains robust.

While acknowledging the potential negative impacts on consumer spending from a weaker yen, Ito noted that the current levels could benefit export-driven sectors of the economy. He suggested that any adverse effects on consumption could be mitigated by policies designed to boost consumer spending.

Takatoshi Ito has a notable background in economic policy, having served as the deputy vice minister for international affairs at Japan’s finance ministry from 1999 to 2001, and as a private-sector member of the government’s top economic council until 2008.

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Powell Expected to Indicate Rate

Powell Expected to Indicate Rate Cuts Hinge on Further Inflation Reduction

Powell Expected to Indicate Rate Cuts Hinge on Further Inflation Reduction

Following three consecutive inflation reports that exceeded expectations, Federal Reserve officials have become increasingly cautious about the likelihood of interest rate cuts this year. As they conclude their latest policy meeting on Wednesday, the focus is on whether they will continue to anticipate any rate cuts for the remainder of the year.

Previously, Wall Street traders had predicted up to six rate cuts in 2024, but they have since adjusted their forecasts to just one reduction. This shift in sentiment comes despite the Fed’s benchmark rate currently standing at a 23-year peak of 5.3%, following 11 increases that concluded last July. At their March 20 meeting, Fed policymakers themselves had projected three rate cuts in 2024. Such reductions would typically lead to decreased borrowing costs for consumers and businesses, affecting mortgages, auto loans, and credit cards.

Despite the change in trader expectations, most economists still anticipate two rate cuts this year, although they concede that persistent high inflation could result in fewer or no cuts. The Fed’s preferred inflation measure recorded a 4.4% annual rate in the first three months of this year, a significant increase from 1.6% at the end of 2023 and well above the Fed’s 2% target.

Economic indicators suggest a healthier economy and stronger hiring than most economists had anticipated. The unemployment rate has stayed below 4% for over two years, marking the longest stretch since the 1960s. Consumer spending also remained strong in the first quarter of the year. Consequently, Fed Chair Jerome Powell and other officials have expressed that they are in no rush to lower the benchmark interest rate.

In recent remarks, Powell noted that the ongoing high rate of price increases has diminished the confidence among Fed officials that inflation would steadily return to their target, making imminent rate cuts unlikely. He emphasized that rate cuts would be off the table as long as inflation stays elevated, although he did not suggest that new rate hikes were being considered.

Most economists anticipate Powell will reaffirm this stance in the news conference following the Fed’s meeting. However, any deviation from his previous suggestion that the rate has likely peaked could signal a lesser likelihood of rate cuts this year.

Economic growth slowed to a 1.6% annual pace in the early months of the year, yet consumer spending growth remained vigorous, indicating potential ongoing economic expansion. This persistent strength has led some Fed officials to consider whether current interest rates are sufficient to moderate the economy and inflation. Some speculate that rates might need to increase if inflation does not continue to decline.

Additionally, on Wednesday, the Fed might announce a reduction in the pace of unwinding one of its major COVID-era policies—the purchase of trillions of dollars in Treasury securities and mortgage-backed bonds. This process, intended to stabilize financial markets and maintain low long-term interest rates, is currently set to let $95 billion in securities mature monthly without renewal. In March, officials discussed decreasing this amount to about $65 billion per month to avoid market disruptions similar to those in 2019 when a similar strategy led to spikes in short-term interest rates. The goal is a more methodical reduction to prevent market instability.

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Japanese Yen Bears Show Resilience Despite Intervention Concerns

Japanese Yen Defensive, Holds 157.00 Against USD Before US Data

Japanese Yen Defensive, Holds 157.00 Against USD Before US Data

The Japanese Yen (JPY) continues to struggle against the US Dollar (USD) in Tuesday’s Asian trading session, moving further away from its one-week peak of the mid-154.00s reached on Monday. Despite potential intervention from Japanese authorities and speculation about policy adjustments, the Bank of Japan’s (BoJ) cautious stance on tightening continues to weaken the JPY. Additionally, decreasing inflation rates in Tokyo and reduced concerns about escalating Middle East tensions are further diminishing the appeal of the JPY as a safe-haven currency.

Conversely, the USD is gaining strength, recovering from a significant drop to approach a two-week high. This rebound is fueled by expectations that the Federal Reserve (Fed) will maintain higher interest rates for an extended period due to persistent inflation, bolstering the USD/JPY currency pair in its upward trajectory. Traders are now turning their attention to upcoming US economic reports, including the Chicago PMI and the Conference Board’s Consumer Confidence Index, expected later in the North American session on Tuesday. These indicators may provide short-term trading opportunities.

The spotlight, however, is on the Federal Open Market Committee (FOMC) meeting scheduled for Wednesday and the subsequent release of the US Nonfarm Payrolls (NFP) report on Friday. The outcomes of these events are anticipated to significantly impact USD price movements and will be crucial in determining the Fed’s future interest rate decisions. The insights from the NFP report, in particular, will be vital for assessing the potential for rate adjustments by the Fed.

Meanwhile, the persistent interest rate differential between the US and Japan is likely to limit any substantial gains for the JPY in the near term. As traders and investors assess these dynamics, the USD/JPY pair remains a focal point in the forex market, with key economic releases and policy decisions expected to drive significant currency movements.

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Japanese Yen Weakens as Hopes for BoJ Rate Hikes Fade, FOMC Minutes Awaited

Japanese Yen Weakens Amid Fading Hopes for BoJ Rate Hikes, FOMC Minutes in Focus

Japanese Yen Weakens Amid Fading Hopes for BoJ Rate Hikes, FOMC Minutes in Focus

The Japanese Yen (JPY) continued to drift lower against the US Dollar (USD) on Wednesday, approaching levels last seen in mid-August. Recent economic data from Japan revealed that real wages declined in August after two consecutive months of gains, while household spending also dropped. This raises concerns over the strength of private consumption and the sustainability of Japan’s economic recovery. Additionally, comments on monetary policy from Japan’s new Prime Minister have added to the uncertainty surrounding the Bank of Japan’s (BoJ) potential for future rate hikes, further weighing on the JPY.

Adding to the Yen’s weakness, reports of a possible ceasefire between Hezbollah and Israel have reduced demand for the safe-haven currency. Meanwhile, the US Dollar has gained strength, nearing its seven-week high, as markets reduce expectations for aggressive policy easing by the Federal Reserve (Fed). This has pushed the USD/JPY pair beyond the mid-148.00s during the European session.

Despite the current upward momentum for the USD/JPY pair, market participants remain cautious, as Japanese authorities may intervene to support the Yen. Additionally, the release of the Federal Open Market Committee (FOMC) meeting minutes later on Wednesday could influence the pair’s direction, depending on how the outlook for US monetary policy unfolds.

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Bitcoin and Crypto Market Decline Amid Powell’s Hints at Further Rate Cuts

Bitcoin and Crypto Market Continue Decline Despite Powell’s Hints at Rate Cuts

Bitcoin and Crypto Market Continue Decline Despite Powell’s Hints at Rate Cuts

The cryptocurrency market remained in a downtrend on Monday, despite Federal Reserve (Fed) Chair Jerome Powell hinting at possible further interest rate cuts later this year.

Crypto Market Slips Amid Speculation of Rate Cuts

Fed Chairman Jerome Powell indicated that while the recent 50 basis point (bps) interest rate cut reflects optimism about economic conditions, it does not guarantee that future cuts will be as large. Speaking at the National Association for Business Economics, Powell said, “Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance. But we are not on any preset course.”

He added that the US economy remains in good shape, emphasizing that the Fed’s primary goal is to maintain this stability. Powell also noted that the 50 bps rate cut signals confidence in a stronger labor market, which could lead to reduced inflation.

Powell suggested that more rate cuts could be on the horizon, contingent on future economic data. “As we consider additional policy adjustments, we will carefully assess incoming data, the evolving outlook, and the balance of risks,” Powell stated.

Historically, lower interest rates have positively impacted the cryptocurrency market, particularly Bitcoin. During the 2017 crypto bull market and the surge in initial coin offerings (ICOs), interest rates hovered between 0.75% and 1.25%. However, when the Fed began raising rates in 2018, the crypto market experienced a correction.

Despite Powell’s remarks, the crypto market continued to slide, registering a 4.2% decline as of Monday. Major cryptocurrencies such as Bitcoin, Ethereum, and Solana fell by 3.5%, 2.3%, and 2.6%, respectively.

Widespread Decline Across Crypto Categories

The decline was not limited to major cryptocurrencies. Tokens in the artificial intelligence category, including NEAR, ICP, ASI, RENDER, and GRT, also saw losses in the past 24 hours. Meme coins like Dogecoin (DOGE) and Shiba Inu (SHIB) experienced sharp declines of nearly 10%.

Despite the current downturn, some market observers believe Powell’s speech could trigger a bullish reversal. Black Swan Capitalist co-founder Vandell commented that Powell’s hint of rate cuts is “very positive for risk-on assets like crypto.” He explained that rate cuts could boost credit creation and global liquidity, potentially setting the stage for a major crypto rally. “The timing is unarguably by design,” Vandell remarked in an X post.

Other members of the crypto community have echoed this optimism, forecasting a potential price surge for Bitcoin as Powell opens the door for further rate cuts.

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US Dollar Index Climbs Above 100.50, Upside Potential

US Dollar Index Climbs Above 100.50, Upside Potential Appears Limited Ahead of US PCE Data

US Dollar Index Climbs Above 100.50, Upside Potential Appears Limited Ahead of US PCE Data

The US Dollar Index (DXY) rose to around 100.65 during Friday’s Asian trading session, but its upside momentum seems constrained due to expectations of further rate cuts from the Federal Reserve (Fed). The broader weakness in the US Dollar persists as the market anticipates lower borrowing costs ahead.

Last week, the Fed cut interest rates by 50 basis points (bps), with Chair Jerome Powell describing it as a “recalibration” to support the labor market while moving inflation closer to the Fed’s 2% target. Though more rate cuts are expected, Powell clarified that the Fed’s policy path is flexible, which could limit DXY’s upward movement in the near term. According to CME Group’s FedWatch Tool, markets are currently pricing in a 48.8% chance of another 50 bps cut and a 51.2% chance of a 25 bps cut.

Despite positive US economic data on Thursday, the US Dollar’s rally lost steam as focus shifted to the upcoming US inflation data, specifically the Personal Consumption Expenditures (PCE) Price Index, due later on Friday. Analysts forecast a 2.3% year-over-year rise in headline PCE for August and a 2.7% YoY increase in core PCE.
US Durable Goods Orders for August remained unchanged, beating the consensus expectation of a 2.6% decline. Additionally, the final estimate of US Gross Domestic Product (GDP) for the second quarter confirmed a 3.0% annual growth rate, as previously projected.

Fed officials maintain a dovish stance. Fed Governor Lisa Cook supported last week’s 50 bps rate cut, citing risks to employment, while Governor Adriana Kugler also advocated for more cuts if economic conditions warrant it. This dovish outlook continues to weigh on the US Dollar Index’s performance, limiting its potential gains.

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BOJ Surprises with Removal of Forward Guidance

BOJ Surprises with Removal of Forward Guidance – UOB Group

BOJ Surprises with Removal of Forward Guidance – UOB Group

The Bank of Japan (BOJ) kept its monetary policy unchanged but unexpectedly removed its forward guidance, surprising markets, according to UOB Group Senior Economist Alvin Liew.

No Change in Monetary Policy as Expected

“At its scheduled Monetary Policy Meeting (MPM) on Friday (September 20), the BOJ unanimously decided to maintain its current monetary policy guidelines for money market operations, which was in line with market expectations,” Liew noted.

Unexpected Removal of Forward Guidance

The surprise in the September MPM statement was the omission of any forward guidance on monetary policy, a stark difference from the July meeting. Despite this change, the BOJ’s positive outlook for the economy and its expectations for gradually rising inflation remained consistent with the July MPM.

“We anticipate that the BOJ will begin normalizing monetary policy in the fourth quarter of 2024, likely during the October MPM, with a 25-basis-point hike to 0.50%, which we expect to be the terminal rate. However, this outlook will depend on further changes in the Consumer Price Index (CPI) forecasts in future meetings,” Liew concluded.

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Bank of Japan Keeps Interest Rate

Bank of Japan Keeps Interest Rate Unchanged in September, As Expected

Bank of Japan Keeps Interest Rate Unchanged in September, As Expected

On Friday, the Bank of Japan (BoJ) announced that it would maintain its short-term interest rate target between 0.15% and 0.25%, following a two-day monetary policy review. This decision aligned with market expectations.

Back in July, the BoJ surprised markets by raising the policy rate by 15 basis points (bps) from 0%-0.1% to its current range of 0.15%-0.25%. The central bank also introduced a plan to taper its monthly purchases of Japanese government bonds (JGB) to approximately ¥3 trillion per month by the first quarter of 2026.

Market Reaction to BoJ’s Policy Announcement

Following the BoJ’s announcement, the USD/JPY pair saw an initial rise toward 143.00, but quickly retreated to 142.65, where it currently fluctuates. The pair is down 0.06% for the day at the time of writing.

What to Expect from the BoJ Interest Rate Decision

The BoJ’s decision to hold rates steady was largely anticipated by the market. While the central bank is expected to maintain its current stance for now, investors will be looking for any signals of when rates may rise again.

Money markets are currently pricing in a 25-basis point increase by the end of the year, which would bring the policy rate to 0.50% at the BoJ’s December meeting.

Inflation and Wage Growth: Key Factors for Future Rate Hikes

Japan’s inflation remains above the BoJ’s 2% target, and recent wage growth—1.1% year-over-year in June and 0.4% in July—suggests increased consumer spending. However, if inflation driven by cost pressures begins to weigh on spending, the central bank may face challenges in achieving demand-driven inflation, potentially delaying further rate hikes.

Political and Market Considerations

BoJ policymaker Naoki Tamura has argued that rates should be raised to at least 1% by the second half of the next fiscal year, while others, like Sanae Takaichi, a potential successor to Prime Minister Fumio Kishida, have cautioned against further hikes to avoid dampening consumer sentiment. Meanwhile, Governor Kazuo Ueda reiterated in August that the BoJ would raise rates if inflation continues to move toward the 2% target, though he acknowledged the potential for market volatility to affect the timing of such a decision.

Market Expectations Moving Forward

According to a Reuters poll, economists unanimously agreed that the BoJ would not raise rates at the September meeting, though most anticipate a hike by year-end. Analysts at Standard Chartered predict a 25 bps rate increase by December 2024 due to stronger-than-expected inflation, which has remained above the 2% target for 21 months.

Impact on USD/JPY

The Fed-BoJ policy divergence continues to dominate the USD/JPY outlook. With the US Federal Reserve recently cutting rates by 50 basis points and the potential for further easing, the yen may continue to gain against the dollar. Technical analysis suggests that a further decline in USD/JPY could bring the pair toward its 2024 low of 139.57, with deeper retracements potentially reaching the July 2023 low of 137.23 and the March 2023 low of 129.63.

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Gold Price Approaches Weekly High Ahead

Gold Price Nears Weekly High Ahead of US NFP Report, Remains Below $2,525 Resistance

Gold Price Nears Weekly High Ahead of US NFP Report, Remains Below $2,525 Resistance

Gold price (XAU/USD) is trading near its weekly high for the third consecutive day on Friday, ahead of the European session. Despite this upward trend, investors remain cautious as they await the US Nonfarm Payrolls (NFP) report before making any significant moves. Rising expectations of a larger interest rate cut by the Federal Reserve (Fed) in September are pressuring the US Dollar (USD), which is supporting gold, a non-yielding asset.

Market Overview

A series of mixed US employment reports this week have added to concerns about the health of the labor market, driving up demand for safe-haven assets like gold. Geopolitical tensions and a reduced appetite for riskier assets are also contributing to gold’s appeal. However, traders are holding off on fully committing to an extended rally until after the release of key US macroeconomic data.

Daily Market Movers: Gold Price Supported by Fed Rate-Cut Expectations, Lower Bond Yields, and Weaker USD

  • Thursday’s ADP report showed that the US private sector added only 99,000 jobs in August, the smallest increase since January 2021. This was well below the forecast of 145,000, with July’s figure also revised downward to 111,000 from the originally reported 122,000.
  • Job openings fell to a three-and-a-half-year low in July, according to Wednesday’s report, signaling a softening labor market.
  • While the ISM Services PMI for August rose slightly to 51.5, the Employment Index declined from 51.1 to 50.2, reinforcing concerns about a slowing economy.
  • US Initial Jobless Claims dropped to 227K, down from the previous week’s 232K, but the labor market is still showing signs of strain.
  • Comments from Fed officials, including San Francisco Fed President Mary Daly and Chicago Fed President Austan Goolsbee, support the case for rate cuts. Daly emphasized that the economy is slowing and inflation is falling, while Goolsbee suggested that labor and inflation trends justify easing policy.

Dovish Fed expectations are weighing on US Treasury yields and the USD, which in turn is bolstering gold prices. According to the CME Group’s FedWatch Tool, there is now a 40% chance of a 50-basis-point rate cut at the Fed’s September 17-18 meeting.

Technical Analysis: Gold Price Set for New Highs if $2,525 Barrier Is Cleared

From a technical standpoint, gold’s next immediate hurdle is the $2,524-$2,525 supply zone. A decisive break above this level could trigger further bullish momentum. Indicators on the daily chart remain positive and are not yet signaling overbought conditions, which suggests that the upward trend could continue.

Should gold clear the all-time high of $2,531-$2,532, first reached on August 20, it would confirm a strong bullish outlook and likely lead to more gains.

On the downside, the $2,500 psychological level is expected to offer immediate support. If breached, gold could drop toward the $2,471-$2,470 range. A break below this could open the door for deeper losses toward the 50-day Simple Moving Average (SMA) near $2,440, and potentially the $2,400 mark and 100-day SMA around $2,388.

Outlook: Focus on US NFP Report

The market’s attention is now firmly on the US Nonfarm Payrolls report, expected to show 160,000 job additions in August, with the unemployment rate ticking down to 4.2%. This data will be crucial in shaping expectations for the Fed’s next policy move, and it could play a pivotal role in determining the next direction for gold prices.

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Silver Price Forecast

Silver Price Forecast: XAG/USD Holds Below $28.50 as Traders Eye US PMI Data

Silver Price Forecast: XAG/USD Holds Below $28.50 as Traders Eye US PMI Data

Silver (XAG/USD) is trading with a mild bearish bias around $28.25 early Thursday during the Asian session. A modest recovery in the US Dollar (USD) is weighing on silver prices. However, speculation that the US Federal Reserve (Fed) may implement a deeper interest rate cut in its upcoming meeting this month is helping to limit silver’s losses.
The weaker US JOLTS report released on Wednesday has increased expectations for a 50 basis point (bps) rate cut by the Fed. According to the CME FedWatch tool, which gauges market sentiment regarding the Fed funds rate, there is now a 57% chance of a 25 bps rate cut and a 43% probability of a 50 bps cut at the Fed’s September meeting. The possibility of imminent rate cuts may help support silver prices in the near term, as lower rates make silver more affordable for buyers.

The upcoming US August Nonfarm Payrolls (NFP) report on Friday is expected to show an addition of 161,000 jobs. A weaker-than-expected result could put pressure on the US Dollar and lift silver prices, as silver is denominated in USD.

On the downside, concerns about China’s economic growth and demand may undermine silver prices. China, the world’s largest silver exporter, is facing growth pessimism. Analysts at Bank of America Global Research recently revised China’s 2024 GDP forecast down from 5.0% to 4.8%. Additionally, the weaker Chinese Caixin Services PMI, which dropped to 51.6 in August from 52.1 in July, is contributing to demand concerns for the white metal.

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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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