Daily Market Analysis

 

 

Latest Economic and Fundamental Insights

 

The dollar index held steady around 103.9 on Friday after four straight sessions of declines, as investors cautiously awaited the October jobs report to gauge the strength of the labor market ahead of the Federal Reserve’s policy meeting and the upcoming U.S. presidential election.

Gold stabilizes after sharp decline

Recent data showed strong personal income and spending numbers, a rise in core inflation that remained above target, and an unexpected drop in jobless claims. This has reinforced the perception that the U.S. economy is resilient in the face of higher borrowing costs, and given the Fed more room to avoid aggressive cuts.

However, political uncertainty in the US supported gold, as the prospect of another Trump presidency raised expectations of expansionary fiscal policy and higher tariffs, prompting investors to hold gold as a hedge against long-term inflation risks.

Moreover, the ongoing tensions in the Middle East and the war in Ukraine have enhanced the appeal of gold as a safe haven asset.

Gold rises; investors cautious on Fed decision

Gold prices rose in early Asian trade after falling overnight. Gold fell as investors booked profits after strong gains over the past month.

Overall strong economic data from the US supports a more cautious approach to the Fed’s rate-cutting path in the coming months.

Investors will focus on the US October employment report and PMI data due today to gauge the Fed’s next move.

Asian markets started what is likely to be a key month on a cautious note, with most stocks lower and Treasury yields hitting three-month highs on Friday, as investors await U.S. payrolls data, although a rate cut next week is very much on the cards.

Oil prices rise amid escalating conflicts in the Middle East, with Brent crude trading at $75.00 and West Texas Intermediate at $70.00.

-Israeli intelligence indicates that Iran is preparing to attack Israel from Iraqi territory in the coming days, possibly before the U.S. presidential election on Nov. 5, Axios reported Thursday, citing two unnamed Israeli sources.

The Axios report added that the attack is expected to be carried out from Iraq using a large number of drones and ballistic missiles.

Oil prices were also supported by expectations that OPEC+ may delay a planned increase in oil production in December by a month or more, citing concerns about weak oil demand and rising supply, four sources familiar with the matter told Reuters on Wednesday. Two of the sources said a decision to delay the increase could come as early as next week.

But prices are set to fall more than 1% on the week, struggling to recover from a 6% loss on Monday after an Israeli strike on Iran’s military on Oct. 26 bypassed oil and nuclear facilities and did not disrupt energy supplies.

“Although the crude oil market is looking to post gains for a third straight day, it has failed to erase the significant gap to the downside that followed Monday’s reopening,” said Tony Sycamore, market analyst at Sydney-based IG.

He added that the recovery in West Texas Intermediate crude is expected to extend again towards the level at which it closed last Friday at around $71.80, as tensions in the Middle East return to focus.

-Bitcoin price stabilizes above $72,000 area. Bitcoin is showing positive signs and may soon target its all-time high.

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Smart technical reports

 

 

How they work

A likely scenario is proposed for today, and the probability of this scenario being achieved, according to technical analysis, may be between 60% and 75%.

If the first scenario fails, the probability of the second scenario being achieved will be between 60% and 75% certain.

The first scenario fails when the price reaches the level of the alternative scenario condition, and the alternative scenario is immediately activated and the prediction from the first scenario is cancelled.

These reports are not considered a substitute for the trader’s decision, but rather they are a tool to assist the follower in making his own decisions, as a reference based on the origins of classical technical analysis.

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GOLD

 

General trend: Upward

Time interval: half an hour (30 minutes)

Current price: 2751.87

Scenario 1: Buy gold with a break and stability above 2760.76, targeting 2766.78 and 2773.32

Alternative scenario: Sell gold with a break and stability below 2748.97, targeting 2742.52 and then 2734.69

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

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CRUDE OIL

 

Trend: Upward

Interval: Half an hour (30 minutes)

Current price: $70.23 per barrel

Scenario 1: Buy oil by breaking the $70.69 level, targeting $71.16 and then $71.72.

Alternative scenario: Sell oil with a break and stability by closing a candle below the $70.01 levels, targeting $69.49 and then $68.90.

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

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EURUSD

 

General trend: Down

Interval: Half an hour (30 minutes)

Current price: 1.08746

Scenario 1: Sell EUR/USD after breaking 1.08625, targeting 1.08456 and then 1.08252.

Alternative scenario: Buy the EUR/USD with a break and hold with a candle closing above 1.08853, targeting 1.09037 and then 1.09262.

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

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GBPUSD

 

Trend: Down

Interval: Half an hour (30 minutes)

Current price: 1.28977

Scenario 1: Selling the pound dollar with a break and stability below the 1.28827 level, targeting the price of 1.28587 and then 1.28365

Alternative scenario: Buy the pound dollar with a break and hold with a close above 1.29127, targeting 1.29368 and then 1.29655.

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

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NAS100

 

Trend: Down

Interval: Half an hour (30 minutes)

Current price: 20063

Scenario 1: Selling the Nasdaq with a break and stability with a close below 19999, targeting a price of 19874 and then 19767

Alternative scenario: Buy Nasdaq with a break and hold with a close above 20156 with a target price of 20259 then 20377

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

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Economic Calendar

 

(Times are in GMT+3)

-From USA Average Hourly Earnings (Monthly) (October) 15:30
-From USA Non-Farm Employment Report (October) 15:30
-From USA Unemployment Rate (October) 15:30 -From USA
Manufacturing PMI (October) 16:45
-From USA ISM Manufacturing PMI (October) 17:00

Fundamental Analysis

 

 

The dollar index held steady around 103.9 on Friday after four straight sessions of declines, as investors cautiously awaited the October jobs report to gauge the strength of the labor market ahead of the Federal Reserve’s policy meeting and the upcoming U.S. presidential election.

Nonfarm payrolls data is expected to show 113,000 jobs added in October, down from 254,000 in September, although recent hurricanes could weigh on those numbers.

Previous data had indicated a rise in private sector employment in October, and initial claims fell to their lowest levels since May 2021, indicating a strong labor market.

Moreover, personal consumption expenditures inflation figures pointed to easing price pressures, while the US economy grew less than expected in the third quarter.

These factors have boosted expectations of a rate cut by the US Federal Reserve next week, albeit likely at a more moderate pace of 25 basis points.

The dollar remained steady against other major currencies but faced pressure from the yen following less dovish comments from the Bank of Japan.

Gold held steady at around $2,750 an ounce on Friday after losing more than 1% in the previous session, as markets weighed safe-haven demand in the face of pressure from a less accommodative Federal Reserve.

Oil prices extended gains on Friday, jumping more than $1 a barrel to trim weekly losses, as geopolitical tensions in the Middle East escalated after reports that Iran was preparing to launch a retaliatory strike on Israel from Iraq in the coming days.