Daily Market Analysis

 

 

 

Latest Economic and Fundamental Insights

 

The dollar index held steady around 104.6 on Wednesday, remaining in a narrow range so far this week as investors await the minutes of the Federal Reserve’s latest policy meeting for more insights into the path of interest rates.

-Gold prices are stable on the Federal Reserve interest rate expectations

Recent data indicated that US inflation has resumed its downward trend, but many Fed policymakers remained cautious about cutting interest rates too early and ruled out the need to raise rates. (Fedwatch)

Federal Reserve policymakers said the U.S. central bank should wait several more months to ensure inflation is indeed back on track to its 2% target before cutting interest rates.

Gold is known as an inflation hedge, but rising interest rates increase the opportunity cost of holding non-yielding gold.

-US households continued to feel the impact of inflation in late 2023 even as price pressures eased, with most Americans saying their financial situation changed little in the past year.

Minutes from the Federal Reserve’s latest policy meeting, expected at 1800 GMT, could provide further insights into the timing of widely expected interest rate cuts.

The Shanghai Futures Exchange will lift trading limits and margin requirements for gold and silver futures starting May 23.

Encouraged by China’s recent measures and pledges to fix the weaker parts of its faltering economy, domestic investors are buying stocks in the cheap stock market, while most foreign investors are optimistic but taking it slowly.

Elsewhere, Israel urged “the countries of the civilized world” to oppose the request of the Prosecutor of the International Criminal Court to issue arrest warrants against its leaders, and to announce that they will ignore the arrest warrants.

-Oil declines for the third session, as uncertainty regarding the timing of interest rate cuts from the US Federal Reserve affected demand expectations, with Brent crude trading at $82.00 levels, as well as West Texas Intermediate crude at $77.00 levels.

Fed spokespeople this week have largely called for caution and more confidence that inflation will return to 2% before they cut interest rates.

Industry data also showed that US crude inventories increased by 2.48 million barrels last week, defying expectations for a decline of 3.1 million barrels.

Moreover, the risk premium resulting from tensions in the Middle East diminished as oil supplies were not affected.

-Bitcoin price started a downward correction from the $72,000 area. BTC is now consolidating near $70,000 and may be looking at another increase in the near term.

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Smart technical reports

 

 

How they work

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

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

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

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

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GOLD

 

General trend: bullish

Time interval: half an hour (30 minutes)

Current price: 2415.04

The first scenario: Buy gold at a break and hold above 2420.49, with a target price of 2426.92 and 2434.05.

Alternative scenario: sell gold at a break and hold below 2409.11, with a target price of 2402.66 and then 2396.43.

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

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CRUDE OIL

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: $77.91 per barrel

The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $78.28, targeting a price of $78.75, then 79.31. Alternative scenario: Selling oil at a break of $77.60, targeting a price of $77.08, then 76.49.

Comment: Trading above supports and averages suggests an upward trend

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EURUSD

 

General trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.08581

The first scenario: Buying Eurodollars at a break of 1.08695, targeting a price of 1.08880, then 1.09104.

Alternative scenario: sell the euro/dollar at a break and hold firm by closing the candle below 1.08468, targeting the price of 1.08308 then 1.08095.

Comment: Trading above supports and averages suggests an upward trend

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GBPUSD

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.27414

The first scenario: Buy the pound dollar at a break and hold at the highest level of 1.27563, targeting the price of 1.27849, then 1.28071.

Alternative scenario: sell the pound dollar at a break and hold firm by closing below 1.27228, targeting a price of 1.27030 then 1.26806.

Comment: Trading above supports and averages suggests an upward trend

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NAS100

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 18805 The first scenario: Buying the Nasdaq at a break and holding steady with a close above 18854, targeting the price of 18923 then 19004 Alternative scenario: Selling the Nasdaq at a break and holding steady with a close below 18752 with a price of 18695 then 18644

Comment: Trading above supports and averages suggests an upward trend

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Economic Calendar

 

(Times are in GMT+3)

From USA Existing Home Sales (April) 17:00

From the United States of America US crude oil inventory 17:30
Federal Open Market Committee meeting minutes 21:00

 

Fundamental Analysis

 

 

The dollar index settled around 104.6 on Wednesday, remaining in a narrow range so far this week as investors await minutes from the Federal Reserve’s latest policy meeting for more insights on the path of interest rates.

So far this week, Fed spokesmen have called for caution before cutting interest rates, with Fed Governor Christopher Waller saying he will need to see several more months of good inflation data.

Atlanta Fed President Raphael Bostic also said Monday that he believes “our new steady state is likely to be higher than what people have known over the past decade, and we may even go back to where we were in the 1990s and 2000s.” However, markets see a roughly 61% chance of a rate cut by the Fed in September and a higher chance of 73% in November.

The dollar remained steady across the board, but fell sharply against the New Zealand dollar after the Reserve Bank of New Zealand stopped being hawkish.

Gold prices steadied on Wednesday and hovered above the key $2,400 level touched earlier this week, supported by safe-haven buying and the possibility of an interest rate cut from the US Federal Reserve later this year.

West Texas Intermediate crude futures fell to around $78 a barrel on Wednesday, falling for a third straight session, as uncertainty over the timing of interest rate cuts from the US Federal Reserve weighed on demand expectations.