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Commodities Silver

Silver Price Forecast: XAG/USD Set to Climb Higher as Descending Trend-Line Breakout Unfolds

Silver Price Forecast: XAG/USD Set to Climb Higher as Descending Trend-Line Breakout Unfolds Silver (XAG/USD) continues its bullish run, building on its recent strong upward momentum. On Monday, the precious metal reached its highest level in nearly two months, continuing to post impressive gains in the European session. As of now, silver trades just below the $31.00 mark, showing an increase of around 0.70% for the day. The technical outlook suggests that this rally could extend further, and any corrective declines could provide new buying opportunities. Recent Momentum and Breakout Above Descending Trend-Line The recent rally in silver can be attributed to a breakout from a short-term descending trend line, which was breached last Friday. This breakout acted as a fresh catalyst for bullish traders, signaling a potential reversal in the broader trend and laying the groundwork for further gains. In addition to the breakout, technical indicators are showing positive signs. Oscillators on the daily chart, such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), are beginning to gain positive traction. This development adds further weight to the bullish outlook for silver, as it suggests that the path of least resistance for XAG/USD remains to the upside. XAG/USD Daily Price Chart Source: TradingView, prepared by Richard Miles Immediate Resistance Levels to Watch With silver climbing toward a new high, the next significant resistance level lies around the $31.45-$31.50 supply zone. This level could act as a temporary barrier, but if silver manages to break through, further upside momentum is likely. A successful move beyond this zone would open the door to reclaiming the $32.00 mark. Above $32.00, silver would be in a strong position to challenge its one-decade high in the mid-$32.00 range, a level last touched in May. If the precious metal manages to sustain this momentum, it could signal a significant shift in market sentiment, potentially attracting even more bullish interest from traders and investors. Support Levels and Buying Opportunities On the downside, immediate support is seen in the $30.50-$30.45 horizontal zone. This area has the potential to cushion any meaningful corrective slide in the silver price. Furthermore, the descending trend-line, which was previously a resistance level, has now turned into a support level, currently hovering near the $30.00 psychological mark. This level could act as a key pivotal point for short-term traders and should provide a solid foundation for silver’s upward movement. In the event of a deeper pullback, this support zone is likely to attract new buyers, viewing the dip as an opportunity to re-enter the market at favorable levels. A significant drop below $30.00, however, could lead to more aggressive selling pressure. A break below this level might expose the XAG/USD to a steeper fall toward the $29.40-$29.35 region, which is the next critical support zone. Risk of Downside Acceleration While the overall bias for silver remains bullish, a convincing break below the $30.00 level could change the near-term outlook. Such a move would likely trigger aggressive technical selling, potentially accelerating the decline toward the $29.00 psychological level. If the selling pressure continues, the next significant support zone lies in the $27.70 area, which represents the monthly low. Additionally, there is intermediate support near the $28.20-$28.15 region, which could also act as a temporary cushion. If the price reaches these levels, traders may reassess the situation and consider whether the decline is a temporary correction or signals a shift toward a bearish market sentiment. However, given the current technical setup and fundamental factors supporting silver, any declines are likely to be short-lived, with buyers stepping in at key support levels. The Broader Outlook for Silver Several factors continue to support the bullish case for silver, beyond the recent technical breakout. Rising concerns about inflation, geopolitical tensions, and a weaker US dollar all contribute to the positive momentum for precious metals. Silver, often considered both an industrial and a safe-haven asset, benefits from these macroeconomic trends. As inflation continues to be a key concern for global markets, precious metals like silver become more attractive as a hedge against rising prices. Moreover, silver’s role in industrial applications, particularly in renewable energy technologies such as solar panels, adds a layer of demand for the metal. This dual role allows silver to perform well both in times of economic uncertainty and during periods of industrial growth. Furthermore, a softer US dollar boosts the appeal of silver and other commodities priced in the currency. A weaker dollar makes silver more affordable for buyers using other currencies, potentially increasing demand and pushing prices higher. What Lies Ahead for Silver? As silver continues its upward trajectory, traders should keep a close eye on key technical levels. The $31.45-$31.50 resistance zone is the immediate hurdle that needs to be overcome for the rally to continue. A break above this zone would confirm further upside momentum, with the next target at the $32.00 mark and potentially higher toward the mid-$32.00s. On the downside, the $30.50-$30.45 horizontal zone and the $30.00 psychological mark are critical support levels. A dip toward these levels could be seen as a buying opportunity, but a break below $30.00 might lead to more aggressive selling and expose silver to a deeper corrective phase. However, given the overall positive technical setup and the supportive fundamental backdrop, the outlook for silver remains bullish. Any corrective dips are likely to be short-lived, with buyers stepping in at key support levels. As long as silver remains above the $30.00 mark, the path of least resistance is to the upside, with the potential for further gains shortly. In conclusion, silver’s recent breakout from a descending trend line, combined with positive momentum from technical indicators, suggests that XAG/USD is well-positioned for further gains. The key resistance levels around $31.45-$31.50 and $32.00 will determine the next phase of the rally, while support near $30.00 provides a strong foundation for any corrective moves. As traders monitor these key levels, the overall outlook for silver remains favorable, with the potential for the white metal

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Analysis Commodities Gold Technical Analysis

Gold Price Bulls Have the Upper Hand Near All-Time High Ahead of Fed Meeting

Gold Price Bulls Have the Upper Hand Near All-Time High Ahead of Fed Meeting The gold price (XAU/USD) has reached a fresh all-time high near the $2,589-2,590 area, marking a significant milestone for the precious metal. However, despite this impressive peak, the gold price has pulled back slightly, trading around the $2,581-2,582 region during the early European session. This brief dip can be attributed to profit-taking in response to a generally positive risk tone in the broader market. Even so, expectations of aggressive policy easing from the Federal Reserve (Fed) continue to act as a supportive factor for the gold price, limiting any significant downward movement. Factors Driving Gold’s Price Surge Rising Bets for a Fed Rate Cut One of the primary reasons for the current bullish momentum in gold is the rising expectation of an oversized rate cut from the Federal Reserve. After recent economic data showed that inflation in the US was subsiding, markets began pricing in the possibility of a 50 basis points (bps) rate cut at the upcoming Federal Open Market Committee (FOMC) meeting. The softer US Consumer Price Index (CPI) and Producer Price Index (PPI) reports have reinforced the belief that the Fed may adopt a more dovish stance, further boosting gold’s appeal as a safe-haven asset. US Treasury Yields and the Dollar Near Lows With inflation easing, US Treasury bond yields and the US Dollar (USD) remain near their lowest levels in 2024, providing additional support for gold. Since gold is a non-yielding asset, lower bond yields make it more attractive to investors seeking a store of value, especially during economic uncertainty. The weaker dollar also enhances the appeal of gold, making the metal cheaper for buyers holding other currencies. Safe-Haven Demand Amid Geopolitical Risks Aside from monetary policy expectations, geopolitical tensions also play a significant role in supporting gold prices. Reports of an attempted assassination of Republican presidential candidate Donald Trump at his Florida golf club on Sunday have added to the uncertainty. Additionally, the protracted Russia-Ukraine war and rising instability in the Middle East have heightened the demand for safe-haven assets like gold. These factors continue to bolster the precious metal’s price, even as bullish traders remain cautious ahead of key central bank events later in the week. XAU/USD Daily Price Chart Source: TradingView, prepared by Richard Miles The Impact of Central Bank Events on Gold Prices FOMC Meeting and Its Influence on Gold The gold market is now focusing on the two-day FOMC policy meeting, which begins on Tuesday. The outcome of this meeting is crucial for determining the future direction of gold prices. If the Fed announces an aggressive 50 bps rate cut, it could further weaken the US dollar and lower bond yields, both of which would be bullish for gold. However, traders seem hesitant to place fresh bets until the policy decision is made, reflecting a sense of caution in the market. Bank of England and Bank of Japan Policy Meetings In addition to the Fed, the Bank of England (BoE) and the Bank of Japan (BoJ) are also scheduled to release their monetary policy updates later this week. These events could introduce further volatility into the markets, potentially providing fresh momentum for gold. If either central bank signals a more accommodative monetary stance, it could drive additional interest in safe-haven assets, reinforcing the bullish outlook for gold. Technical Outlook: Gold’s Uptrend and Key Levels to Watch Well-Established Uptrend Points to Further Gains From a technical perspective, gold’s recent move along an ascending channel since June highlights a well-established uptrend. This supports the prospect of further gains in the near term. However, the Relative Strength Index (RSI) on the daily chart is nearing the overbought zone, which warrants caution for bullish traders. This suggests that while the overall trend is bullish, there may be some resistance at higher levels. Key Resistance Levels The gold price is likely to face stiff resistance around the $2,600 mark, which is currently the top end of the upward-sloping channel. This round figure is expected to act as a key pivotal point. If the price breaks above this level decisively, it could signal a fresh breakout, paving the way for further appreciation in gold prices. Beyond $2,600, the next potential resistance levels could emerge at $2,620 and $2,650. Support Levels to Watch On the downside, the $2,565-2,564 area now acts as immediate support. A break below this level could see gold prices decline toward the $2,532-2,530 zone, which is another strong support area. Any further pullback might be limited near the $2,500 psychological level, where fresh buyers could step in. However, if gold falls below the $2,485 region, it could trigger more significant selling pressure. The $2,470 horizontal support and the $2,464 confluence (comprising the ascending channel support and the 50-day Simple Moving Average) are also key levels to monitor. A decisive break below these levels might shift the near-term bias in favor of bearish traders. Daily Market Movers: Key Drivers for Gold Price Movements Conclusion: A Bullish Outlook with Caution Ahead In conclusion, gold prices have surged to new all-time highs amid rising expectations for a Fed rate cut and ongoing geopolitical tensions. The fundamental backdrop remains supportive of further gains, as easing inflation, low Treasury yields, and a weak dollar all act as tailwinds for the precious metal. From a technical standpoint, gold’s uptrend remains intact, with the $2,600 level acting as a key resistance point. On the downside, the $2,500 mark and the $2,470-2,464 region provide strong support levels. As traders await the outcome of this week’s central bank meetings, the gold market could see increased volatility. However, any significant dips are likely to be viewed as buying opportunities, with the path of least resistance still pointing to the upside. The focus now shifts to the FOMC meeting on Wednesday, followed by the BoE and BoJ updates, which will play a pivotal role in shaping Gold’s next move.

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Free Trading Guides

Crypto Fundamentals and How to Trade Safely: A Comprehensive Guide

Crypto Fundamentals and How to Trade Safely: A Comprehensive Guide Cryptocurrency, often called “crypto,” is a digital or virtual form of currency that uses cryptography for security. Since the advent of Bitcoin in 2009, cryptocurrencies have gained immense popularity and transformed from a niche concept into a significant player in the financial world. However, the volatility and the evolving nature of the crypto market make it crucial for traders to understand its fundamentals and how to trade safely. This article covers the basics of cryptocurrency and provides actionable steps on how to trade it safely. Part 1: Understanding Crypto Fundamentals Before diving into trading, it’s essential to understand the underlying principles of cryptocurrencies. Here’s a breakdown of the core concepts: 1.1 What is Cryptocurrency? Cryptocurrency is a decentralized digital currency that operates on blockchain technology. Unlike traditional fiat currencies (like the US Dollar or Euro), cryptocurrencies are not controlled by any central authority like a government or bank. Bitcoin (BTC) was the first cryptocurrency, but today, thousands of cryptos, such as Ethereum (ETH), Ripple (XRP), and Binance Coin (BNB), exist, each with unique features. 1.2 Blockchain Technology At the heart of every cryptocurrency lies blockchain technology. A blockchain is a decentralized ledger of transactions maintained by a network of computers (called nodes). Every transaction made using cryptocurrencies is recorded in this ledger and is immutable, meaning it cannot be altered or deleted. The decentralized nature ensures transparency, security, and trust. 1.3 Key Cryptocurrency Terminologies Here are some essential terminologies in the crypto world: 1.4 Types of Cryptocurrencies There are various types of cryptocurrencies, each serving a different purpose: 1.5 The Role of Exchanges Cryptocurrency exchanges are platforms where you can buy, sell, or trade cryptos. Major exchanges like Binance, Coinbase, and Kraken allow users to trade cryptos using fiat currencies or other digital assets. It’s essential to understand how exchanges work, their fees, and the risks involved, such as liquidity and security issues. Part 2: How to Trade Crypto Safely Trading cryptocurrencies can be highly profitable, but it comes with significant risks. To ensure safety while trading, you need to be equipped with the right strategies and knowledge. 2.1 Research is Key (DYOR – Do Your Own Research) Crypto trading requires thorough research. Always make sure you understand the asset you are investing in. Some factors to consider include: Never rely solely on hype or social media tips. 2.2 Choose the Right Exchange A secure exchange is crucial for safe crypto trading. Here are some points to evaluate: Some popular and trustworthy exchanges include Binance, Coinbase, and Kraken. 2.3 Use a Secure Wallet Exchanges are often targeted by hackers, so it’s safer to transfer your crypto assets to a private wallet. Here are the types of wallets to consider: Use cold wallets for long-term storage, especially for large amounts. 2.4 Manage Risks with Diversification Never put all your funds into a single cryptocurrency. Diversify your portfolio by investing in different assets, such as Bitcoin, altcoins, and stablecoins. Diversification reduces the impact of a single asset’s volatility on your overall portfolio. 2.5 Develop a Trading Strategy Having a clear trading strategy is crucial for success. Here are a few popular approaches: Choose a strategy that suits your risk tolerance and time availability. 2.6 Set Stop Losses and Take Profits A stop-loss order automatically sells your cryptocurrency if the price drops to a certain level, protecting you from significant losses. Similarly, a take-profit order locks in profits by automatically selling your crypto when it reaches a predetermined price. Setting these limits helps you manage emotions, especially in a market as volatile as crypto. 2.7 Stay Informed About Market Conditions The crypto market is highly influenced by news, government regulations, technological developments, and market sentiment. Stay updated with the latest crypto news and use technical analysis tools to understand price trends and market sentiment. 2.8 Beware of Scams The crypto world is unfortunately rife with scams, including phishing attacks, Ponzi schemes, and fake exchanges. To avoid falling victim: Part 3: Conclusion Cryptocurrency trading can be a profitable venture, but it requires a deep understanding of the market, strong research skills, and a strategic approach to minimize risks. By focusing on the fundamentals of cryptocurrency and applying the safety measures discussed, you can navigate the world of crypto trading with confidence. Always remember that the crypto market is still relatively young, and with that comes both opportunities and risks. The key to long-term success is continuous learning, staying informed, and practicing safe trading strategies. By mastering these basics and keeping a cautious approach, you can trade crypto safely and successfully!

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Analysis Currencies Market Forecasts USD/JPY

BoJ Nagakawa Japan Economy on Track Since July Meeting

BoJ Nagakawa Japan Economy on Track Since July Meeting Bank of Japan (BoJ) board member Junko Nagakawa addressed the media on Wednesday, providing insights into Japan’s economic trajectory since the central bank’s last meeting in July. She expressed optimism about the country’s recovery, citing that the economy remains on track based on recent data. However, Nagakawa also highlighted key challenges such as volatile markets and uncertainties surrounding interest rate decisions. In this article, we’ll break down Nagakawa’s comments and explore what they mean for Japan’s economy and monetary policy in the near future. Japan’s Economic Outlook Since July: Progress and Stability In her remarks, Junko Nagakawa emphasized that Japan’s economy is progressing well, with data from the months following the BoJ’s July meeting supporting this positive trend. The board member acknowledged that growth has been steady, driven by improving business activity and consumer spending. Despite this, she also stressed that Japan’s recovery is still fragile and dependent on several key factors. Economic Indicators Show Positive Momentum Nagakawa’s remarks indicate that the BoJ’s assessments of recent economic indicators point towards stability. These include favorable employment figures, rising consumer spending, and corporate investment that suggests confidence in Japan’s economic recovery. Key Economic Indicators: Interest Rates: Challenges in Defining Japan’s Neutral Rate One of the key areas of uncertainty for the BoJ is determining the country’s neutral interest rate— the rate that neither stimulates nor restricts economic activity. Nagakawa admitted that it’s challenging to pin down the precise level of Japan’s neutral rate, due to various complex factors influencing the economy. The Importance of Monitoring Inflation and Economic Reactions Nagakawa emphasized that the central bank needs to carefully observe how inflation and the broader economy react to any changes in the BoJ’s short-term interest rate. Japan has struggled with low inflation for years, and policymakers are cautious about any premature tightening that could stifle growth. On the other hand, letting inflation rise too quickly could also pose risks, particularly with Japan’s aging population and heavy public debt burden. Factors Influencing Japan’s Neutral Rate: Market Volatility: A Persistent Concern for BoJ Nagakawa touched on another key issue—market instability. She remarked that global and domestic markets remain volatile, posing potential risks to Japan’s economic recovery. According to Nagakawa, it is essential to investigate the reasons behind market fluctuations and respond appropriately. Understanding the Factors Behind Market Movements Market volatility can be triggered by several factors, both domestically and globally. For Japan, external factors such as geopolitical tensions, changes in global trade policies, and shifts in major economies like the US and China can heavily influence market stability. Domestically, fluctuations in Japan’s inflation expectations, currency movements, and government fiscal policy can all play a role. Potential Causes of Market Instability: Next Rate Hike: Uncertainty Remains While Nagakawa acknowledged that Japan’s economy is making progress, she refrained from commenting on the timing of the next interest rate hike. This aligns with the BoJ’s cautious approach, as the bank continues to weigh the risks of premature tightening against the need to eventually normalize monetary policy. BoJ’s Cautious Stance on Rate Hikes Japan’s central bank has maintained an ultra-loose monetary policy for several years, aimed at boosting inflation and economic growth. However, with inflation creeping upwards and the economy showing signs of resilience, there has been growing speculation about when the BoJ might start raising rates. Nagakawa’s remarks suggest that while the BoJ is aware of the need for eventual tightening, it remains cautious about moving too quickly. She highlighted the importance of monitoring economic and inflation data before making any decisions about future rate hikes. Factors Influencing Rate Hike Timing: Conclusion: Cautious Optimism Amid Uncertainty Junko Nagakawa’s remarks paint a picture of cautious optimism regarding Japan’s economic outlook. While the economy remains on track, challenges such as market volatility and uncertainties surrounding inflation and interest rates persist. The Bank of Japan’s cautious stance on future rate hikes reflects a careful balancing act, as policymakers aim to sustain economic growth without letting inflation rise too quickly. As global and domestic factors continue to evolve, it remains to be seen how the BoJ will navigate these complex challenges in the months ahead. For now, the central bank appears content to maintain its ultra-loose policy, while closely monitoring the economy’s reaction to ongoing developments. By carefully assessing inflation, market conditions, and economic growth, the BoJ will continue to play a central role in guiding Japan’s economic recovery, with future decisions likely to hinge on how well the economy holds up in the face of both domestic and international challenges.

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Commodities Oil – US Crude

Crude Oil Flirts with Fresh Low After Russia Upholds OPEC Targets

Crude Oil Flirts with Fresh Low After Russia Upholds OPEC Targets Overview: Crude Oil Dips to 2023 Lows Crude oil prices continued their downward slide on Tuesday, reaching $67.00 per barrel as markets await the publication of the monthly OPEC report. The drop comes amid reports that Russia is maintaining its production quotas in line with the OPEC+ agreement, even as its revenues from crude sales fall to their lowest level since February. The US Dollar Index (DXY) also retreated slightly after rallying on Monday, with the greenback trading above 101.50. However, a light US economic calendar this week means traders are focused on larger macroeconomic events, including the upcoming OPEC report and geopolitical developments. At the time of writing, West Texas Intermediate (WTI) crude oil trades at $67.37 per barrel, while Brent crude is priced at $70.95 per barrel. Both benchmarks are teetering near their lowest levels of the year, reflecting growing concerns over global demand and supply conditions. Market Dynamics: Russia’s Oil Revenues Take a Hit Russia Honors Production Quotas Amid Revenue Declines Despite falling revenues from crude sales, Russia has stuck to its OPEC+ production quotas, providing some stability in global oil markets. Russian oil prices have fallen to around $60 per barrel, well below the broader market consensus. This decrease in revenue is concerning for Moscow, which is already facing significant economic pressure due to its ongoing military involvement in Ukraine. The lower crude prices are expected to exacerbate Russia’s economic challenges, especially as the war in Ukraine drags on with no end in sight. Russia’s adherence to its production quotas comes as OPEC+ seeks to stabilize global oil markets in the face of weakening demand and geopolitical uncertainty. While Russia’s decision to uphold its output limits helps maintain the fragile balance, it also highlights the challenges OPEC+ faces in navigating the complex dynamics of oil supply and demand. Anticipation Builds for OPEC’s Monthly Report The market is holding its breath as it awaits the release of OPEC’s monthly market report, which is expected to be published at 12:00 GMT. Traders are hoping the report will provide further clarity on the state of the global oil market, including demand forecasts and potential changes in production levels. The report could be a critical factor in determining the near-term direction of crude prices, especially if OPEC signals any significant shifts in output policy. If OPEC continues to maintain its current production levels without making additional cuts, crude prices may face further downward pressure. However, any hint of deeper cuts or a more aggressive stance by OPEC could provide a boost to prices, potentially bringing them back towards the $70 per barrel mark. Geopolitical Factors and Market Movers US Dollar Eases Ahead of Geopolitical Events The US Dollar Index (DXY) eased slightly on Tuesday after a strong rally on Monday. With little on the US economic calendar this week, traders are focused on larger geopolitical events. A key event that could influence market sentiment is the first, and possibly only, debate between former US President Donald Trump and Vice President Kamala Harris as they vie for the White House in 2024. Although the debate will take place after US markets close, it could have an indirect effect on market sentiment, especially in relation to the US Dollar. The easing of the US Dollar provides a small amount of relief to crude oil prices, as a stronger Dollar typically weighs on commodities like oil, which are priced in USD. However, with the Dollar still trading above 101.50, the broader macroeconomic environment remains a headwind for oil prices. Tropical Storm Francine and Potential Disruptions to Oil Production Another key factor weighing on the oil market is the potential impact of Tropical Storm Francine, which is moving towards the Gulf of Mexico. According to reports from Bloomberg, the storm is gaining strength, prompting oil drillers in the region to evacuate crews and halt offshore crude production. While the full impact of the storm is yet to be determined, any significant disruption to production in the Gulf of Mexico could provide some support for oil prices in the short term. In addition to the potential for production disruptions, Hungary’s energy company Mol Group has taken over the responsibility of ensuring the safe flow of Russian oil through Ukraine. This move follows Ukraine’s decision to sanction Russian oil giant Lukoil, which was previously responsible for maintaining the flow of oil through Ukrainian territory. The sanctions and the ongoing geopolitical tensions between Ukraine and Russia continue to cast a shadow over the stability of oil supplies from the region. China’s Crude Imports Expected to Decline Further weighing on crude oil prices is news that China’s crude imports are expected to decline by another 1.2% year over year, according to Liao Na, the chief consultant of energy and chemicals at Mysteel OilChem. As the world’s largest importer of crude oil, any significant decline in Chinese demand has the potential to depress global oil prices further. Given the broader slowdown in the Chinese economy, this trend is likely to continue in the coming months, creating additional headwinds for crude prices. Oil Technical Analysis: Key Levels to Watch Potential for Further Declines From a technical perspective, crude oil prices could face additional downside pressure in the near term. The recent dip to $67.00 per barrel suggests that prices may be vulnerable to further declines, particularly if the upcoming OPEC report does not provide a clear indication of future production cuts. If market sentiment continues to deteriorate, crude prices could drop towards $65.00 or even $60.00 per barrel. The $67.11 level, which was briefly breached on Friday, remains a key support zone to watch. A sustained break below this level could open the door for further declines, with the next major support level coming in at $64.38—the low from March and May of 2023. Upside Resistance Levels On the upside, the first level of resistance for crude oil prices is $75.27 per barrel. If prices can break through

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Currencies USD/JPY

USD/JPY Steadies Above YTD Low as Focus Shifts to US Inflation Data

USD/JPY Steadies Above YTD Low as Focus Shifts to US Inflation Data Overview: USD/JPY Trades Sideways Near 143.00 The USD/JPY pair remains steady near the 143.00 mark as it enters Tuesday’s European session. This level represents a recovery from Monday’s year-to-date (YTD) low of 141.70. Traders appear to be holding off on making significant moves ahead of the release of the United States (US) Consumer Price Index (CPI) data for August, which is due on Wednesday. The sideways trading pattern reflects market participants’ cautious sentiment as they wait for key inflation data, which could have a major influence on the future path of interest rates set by the Federal Reserve (Fed). Market Focus: US Inflation and the Fed’s Rate-Cut Path US Dollar Index Holds Steady as Inflation Data Looms The US Dollar Index (DXY), which tracks the value of the greenback against six major global currencies, is holding near 101.60, maintaining the gains made in recent sessions. The S&P 500 futures posted slight losses during European trading hours, indicating a cautious mood among investors ahead of the inflation release. Traders are expecting the upcoming inflation data to provide clear signals about the future trajectory of Fed monetary policy, particularly concerning interest rate cuts. The CPI data for August is anticipated to play a crucial role in shaping market expectations regarding the Fed’s rate cut decisions. Market participants foresee the headline annual CPI rate decelerating to 2.6%, down from July’s reading of 2.9%, which would mark the lowest rate since March 2021. Core inflation, which excludes volatile items like food and energy, is expected to increase by 3.2%, reflecting steady underlying price pressures. Confusion Over Fed’s Rate Cut Size Persists The inflation data has taken on even more importance following last week’s US Nonfarm Payrolls (NFP) report for August, which provided mixed signals about the state of the labor market. The NFP figures were not definitive enough to clarify whether the Fed will proceed with a gradual or more aggressive rate-cut strategy at its upcoming policy meeting. A softer inflation reading would likely reinforce expectations for a 50-basis points (bps) interest rate cut at the Fed’s meeting next week. However, if the inflation numbers remain stubbornly high or sticky, it could muddy the waters and deepen uncertainty over whether the central bank will adopt a more cautious approach to cutting rates. Japanese Yen Outlook: Firm Despite Slower GDP Growth BoJ Expected to Tighten Policy Further While much of the market focus remains on US inflation and the Fed, the Japanese Yen (JPY) has held its ground. Investors are still betting that the Bank of Japan (BoJ) will continue to tighten its monetary policy for the remainder of the year, despite the country’s slower-than-expected economic growth in the second quarter. Japan’s annualized GDP came in at 2.9%, falling short of the forecasted 3.2% and marking a slight slowdown from the previous quarter’s growth of 3.1%. Nevertheless, inflationary pressures in Japan remain persistent, which has led many traders to maintain expectations that the BoJ will eventually follow through with policy tightening. This belief has kept the Yen firm, even as other currencies fluctuate around inflation data and interest rate speculation. Key Factors Impacting USD/JPY Sideways Trading Pattern Ahead of CPI Release With the US CPI release on the horizon, traders have adopted a cautious approach, and the USD/JPY pair is trading sideways around the 143.00 mark. Monday’s dip to a YTD low of 141.70 was quickly reversed, reflecting a lack of momentum in either direction as market participants await more definitive signals from the inflation data. If the CPI report aligns with expectations of softer inflation, it could signal a potential slowdown in the Fed’s rate hikes, which might weaken the US Dollar and drive USD/JPY lower. On the flip side, if the CPI or core inflation figures remain elevated, the market could price in a more aggressive stance from the Fed, supporting the US Dollar and pushing USD/JPY higher. However, in the near term, the pair seems to be range-bound, with little volatility expected until the inflation report provides fresh direction. Fed’s Interest Rate Cut Uncertainty The path for US interest rates remains uncertain, adding to the sideways movement of USD/JPY. Investors are divided over the magnitude of the Fed’s next rate cut. The chances of a 50-bps rate cut seem to hinge on how inflation data plays out this week. While a lower inflation print would likely encourage the Fed to act more aggressively, a stronger-than-expected report could cause the central bank to tread more cautiously. This uncertainty is reflected in the subdued trading of USD/JPY, as traders are reluctant to take significant positions ahead of the Fed’s decision. BoJ’s Hawkish Turn Expected Amid Persistent Inflation In contrast to the uncertainty surrounding the Fed, there is a clearer expectation that the BoJ will shift toward a more hawkish policy stance in the coming months. Despite weaker GDP growth in the second quarter, Japan’s inflation remains a concern, prompting speculation that the BoJ will eventually need to raise interest rates further to combat rising prices. This expectation has provided underlying support for the Japanese Yen, although USD/JPY has been largely driven by US Dollar dynamics in recent weeks. Technical Analysis: USD/JPY in a Holding Pattern Key Support and Resistance Levels From a technical perspective, USD/JPY is in a holding pattern as it trades near the 143.00 level. Monday’s low of 141.70 provides a key support area, while the recent highs near 143.50 serve as immediate resistance. A break above 143.50 could signal further upside potential, particularly if US inflation data comes in stronger than expected and bolsters the case for a more aggressive Fed stance. On the downside, a move below 141.70 could open the door for a deeper correction, especially if softer inflation data leads to reduced expectations for Fed rate cuts. Conclusion: USD/JPY Awaits Fresh Cues from US Inflation Data The USD/JPY pair remains steady as traders await critical US inflation data, which will likely determine the next significant

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Analysis Commodities Gold Technical Analysis

Gold Price Remains Depressed as USD Gains Traction Ahead of US Inflation Data

Gold Price Remains Depressed as USD Gains Traction Ahead of US Inflation Data Overview of Gold Price Movements and Market Sentiment Gold price (XAU/USD) is experiencing a slight decline as it enters the European session on Tuesday, though it manages to stay above the critical psychological level of $2,500. The recent pullback from gold comes as the US Dollar (USD) strengthens for the third consecutive day, driven by reduced market expectations of a larger 50-basis points (bps) interest rate cut by the Federal Reserve (Fed) in September. This has diminished demand for gold, a traditional safe-haven asset, while a generally positive tone in equity markets further weakens its appeal. Factors Influencing Gold Price Movements While gold’s downward trajectory is noticeable, its decline remains limited due to traders eagerly awaiting the upcoming US inflation data, which will likely determine the next significant price movements. Investors are cautious about placing fresh bets on gold while waiting for clearer indications on the Fed’s rate-cut path. These cues are expected to come from key inflation reports, including the US Consumer Price Index (CPI) and Producer Price Index (PPI), which will be released on Wednesday and Thursday. The outcome of these reports will influence near-term USD price dynamics and shape the future movement of XAU/USD. Market Movers Impacting Gold Price USD Strength and Fed Rate Cut Speculation One of the primary factors weighing on the gold price is the strength of the USD, which has benefited from mixed US employment data released last Friday. This data has reduced the likelihood of a 50-bps rate cut by the Fed in September. The CME Group’s FedWatch tool now indicates a 71% probability of a 25-bps rate cut and a 29% chance of a 50-bps cut at the upcoming Federal Open Market Committee (FOMC) meeting on September 17-18. Fed Officials’ Remarks on Monetary Policy Recent comments from various Fed officials have provided further insight into the central bank’s potential course of action. New York Fed President John Williams indicated that inflation expectations remain well anchored, suggesting that monetary policy could be adjusted toward a more neutral stance, depending on incoming data. Similarly, Fed Governor Christopher Waller highlighted the importance of maintaining economic momentum, signaling that the time has come to start reducing interest rates. Chicago Fed President Austan Goolsbee also emphasized that the Fed is finally catching up with market sentiment, acknowledging the need for a policy shift. These comments suggest that, despite the USD’s recent strength, the broader market remains optimistic about the potential for rate cuts. This, in turn, points to the likelihood that any significant gold price depreciation may be limited in the near term. US Inflation Data and Market Expectations The upcoming release of US inflation data is a key factor influencing both USD and gold price movements. On Wednesday, investors will closely watch the CPI data, followed by the PPI figures on Thursday. These reports are expected to provide crucial insights into the Fed’s future rate-cut strategy, and market participants are bracing for potential volatility in response to these figures. A higher-than-expected inflation reading could support the USD, applying downward pressure on gold, while a weaker print might boost the yellow metal as it reinforces the case for a more aggressive rate cut by the Fed. XAU/USD Daily Price Chart Source: TradingView, prepared by Richard Miles Technical Outlook for Gold Price Range-Bound Trading and Bullish Consolidation From a technical standpoint, gold price has been trading within a relatively tight range over the past three weeks, forming a rectangle pattern on the daily chart. This consolidation phase follows gold’s recent rally to an all-time high and is viewed as a bullish consolidation. Oscillators on the daily chart remain in positive territory, further validating the optimistic outlook for gold. However, it is important to exercise caution before positioning for further appreciation in gold prices. A decisive breakout through the upper boundary of the trading range—near the all-time high of $2,530-$2,532—is necessary to confirm a continuation of the bullish trend. Key Support and Resistance Levels In the event of a downside move, key support levels lie around the $2,485 region, followed by the $2,470 horizontal zone. This lower boundary of the current trading range represents a critical support area, and a decisive break below this level could trigger technical selling, leading to deeper losses. In such a scenario, the gold price might accelerate its decline toward the 50-day Simple Moving Average (SMA), which is currently positioned near $2,446, with the next support target in the $2,410-$2,400 region. Summary of Key Factors To summarize, the gold price is struggling to find meaningful upward momentum due to the USD’s strength, driven by reduced expectations of a 50-bps Fed rate cut. Nevertheless, downside risks are limited as traders await the upcoming US inflation data, which will provide fresh insights into the Fed’s monetary policy outlook. While the technical setup for gold remains bullish, a sustained breakout above the $2,530-$2,532 region is necessary to confirm further gains. On the other hand, a break below the $2,470 support level could open the door to deeper losses in the near term. As market participants look toward the US inflation figures, the gold market remains in a holding pattern, with both bulls and bears awaiting clear direction from this key economic data release.

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Analysis AUD/USD Currencies Technical Analysis

AUD/USD: Potential Dip to 0.6650 Before a Likely Rebound – UOB Group

AUD/USD: Potential Dip to 0.6650 Before a Likely Rebound – UOB Group The Australian Dollar (AUD) is under pressure, with UOB Group FX strategists Quek Ser Leang and Alvin Liew forecasting a dip to 0.6650 before any significant rebound. The outlook suggests that the AUD may continue to face downward pressure, potentially moving lower to 0.6620 if the bearish momentum persists. Here’s a detailed analysis of the AUD/USD pair’s potential movements in both the short and medium term. Short-Term Outlook: Immediate Pressure on AUD/USD The AUD/USD pair has been exhibiting notable volatility in recent sessions. On the previous Friday, the pair briefly rose to 0.6768 but then experienced a sharp decline, closing the day lower by 1.05% at 0.6670. This sharp drop, while substantial, may not be the end of the downward movement. According to UOB Group’s strategists, there is still scope for the AUD to dip further, with 0.6650 being a critical support level in the immediate term. Key Levels to Watch: The strategists emphasize that while the sharp drop on Friday appears to have been overdone, the bearish momentum may still push the AUD lower. The 0.6650 level is seen as a crucial point where a potential rebound could occur. However, the next support level at 0.6620 is not expected to be breached immediately, suggesting that any further decline may be limited in scope, at least in the short term. AUD/USD Daily Price Chart Source: TradingView, prepared by Richard Miles Medium-Term Outlook: Monitoring Key Resistance Levels Looking ahead to the next 1-3 weeks, UOB Group’s analysis indicates that the downward momentum in the AUD/USD pair has increased, although it remains relatively modest. The sharp decline last Friday, which resulted in the AUD closing at 0.6671, suggests that the pair may continue to face downward pressure, with a possible dip to 0.6620 on the horizon. Key Levels for the Medium Term: The medium-term outlook is heavily dependent on whether the AUD can stay below the ‘strong resistance’ level at 0.6770. If the pair remains below this level, the downward momentum is likely to persist, potentially leading to further declines. However, if the AUD breaches this resistance, the bearish outlook may be invalidated, and the pair could see a reversal towards higher levels. Factors Influencing AUD/USD Movements Global Economic Uncertainty One of the key factors contributing to the current pressure on the AUD/USD pair is the broader global economic uncertainty. The Australian Dollar is often viewed as a proxy for global risk sentiment due to Australia’s significant exposure to commodity exports. When global economic conditions are uncertain or when there is a risk-off sentiment in the markets, the AUD tends to weaken. This has been evident in the recent price action, where concerns over global growth and economic stability have weighed on the currency. Commodity Prices and Trade Relations Another critical factor impacting the AUD is the movement in commodity prices, particularly those related to Australia’s key exports, such as iron ore and coal. Any fluctuations in these prices can have a direct impact on the AUD/USD pair. Additionally, Australia’s trade relations, especially with China, play a significant role in determining the currency’s strength. Any negative developments in these areas can further pressure the AUD. Central Bank Policies The monetary policies of both the Reserve Bank of Australia (RBA) and the Federal Reserve (Fed) are also crucial in shaping the outlook for the AUD/USD pair. Any indications of policy divergence between the two central banks can lead to significant movements in the pair. For instance, if the Fed adopts a more hawkish stance while the RBA remains dovish, the AUD could weaken further against the USD. Strategic Implications for Traders Given the current outlook, traders should approach the AUD/USD pair with caution in the coming days and weeks. The key support levels at 0.6650 and 0.6620 will be crucial in determining the pair’s next move. A breach of these levels could signal further downside potential, while a rebound from these levels could offer a buying opportunity for those looking to capitalize on a potential recovery. Key Points for Traders: Conclusion The AUD/USD pair is currently under pressure, with UOB Group’s strategists forecasting a potential dip to 0.6650 before any significant rebound is likely. The downward momentum, while not overly strong, suggests that the pair could move lower to 0.6620 in the medium term if the bearish trend continues. However, the key to this outlook will be whether the AUD can stay below the critical resistance level of 0.6770. Traders should monitor these levels closely and be prepared for potential volatility as global economic conditions and market sentiment evolve.

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Analysis Currencies Fundamental Analysis

Key Market Updates in Forex: Monday September 9 2024

Key Market Updates in Forex: Monday September 9 2024 Overview As the week begins, the US Dollar (USD) remains resilient against its major rivals. Investors are treading cautiously ahead of significant events, including the release of US inflation data and the European Central Bank’s (ECB) monetary policy announcement. Monday’s economic calendar will feature Sentix Investors Confidence for the Eurozone and July Consumer Credit Change for the US. USD Index Holds Firm Amid Market Caution The USD Index, which tracks the greenback’s performance against a basket of major currencies, continues to edge higher early Monday, approaching 101.50. This follows a positive close last Friday, where the USD managed to regain strength despite an initial bearish reaction to the US employment data for August. Risk aversion played a key role in the USD’s recovery, with Wall Street’s main indexes declining sharply. The Nasdaq Composite, for instance, lost 2.7% on Friday. US stock index futures were also showing positive signs early Monday, with gains between 0.4% and 0.6%. This cautious optimism reflects investors’ wariness ahead of the key economic data releases and central bank decisions scheduled for later in the week. US Dollar Performance Against Major Currencies Over the past week, the USD has shown varying levels of strength against major currencies. Notably, the USD was strongest against the New Zealand Dollar (NZD), appreciating by 1.59%. Conversely, it lost ground against the Japanese Yen (JPY), declining by 1.93%. Currency Pair 7-Day Change USD/EUR -0.09% USD/GBP 0.26% USD/JPY -1.93% USD/CAD 0.62% USD/AUD 1.55% USD/NZD 1.59% USD/CHF -0.26% This performance reflects the complex interplay of market forces, including economic data releases and shifting investor sentiment. Key Data: US Nonfarm Payrolls and Market Reactions The US Bureau of Labor Statistics reported an increase of 142,000 in Nonfarm Payrolls (NFP) for August, which fell short of the market expectation of 160,000. Additionally, the previous month’s NFP figure was revised down significantly from 114,000 to 89,000. Despite this, the unemployment rate edged slightly lower to 4.2% from 4.3%, and annual wage inflation, as measured by the change in Average Hourly Earnings, rose to 3.8% from 3.6%. While the headline NFP number disappointed, the overall labor market data was mixed, with some positive aspects that provided support for the USD. The wage growth figures, in particular, suggest that inflationary pressures remain present, which could influence the Federal Reserve’s monetary policy decisions in the near term. Major Currency Movements EUR/USD: Reversal After Spike EUR/USD spiked to a weekly high above 1.1150 during the American session on Friday, driven by the initial market reaction to the US jobs data. However, the pair quickly reversed course, closing the day in the red below 1.1100. Early Monday, EUR/USD remains on the back foot, declining towards 1.1050. Investors are likely cautious ahead of the ECB’s upcoming policy meeting, which could have significant implications for the euro’s direction. GBP/USD: Struggling for Direction GBP/USD ended the previous week virtually unchanged, trading just below 1.3100 early Monday. The pair is struggling to find a clear direction as traders await the release of the UK labor market data on Tuesday. This data will provide fresh insights into the state of the UK economy and could influence the Bank of England’s policy outlook, thereby impacting the pound’s trajectory. USD/JPY: Rebounding After Four Days of Losses USD/JPY registered losses for the fourth consecutive day on Friday, touching its lowest level in a month below 142.00. However, the pair staged a rebound at the start of the week, trading above 143.00 early Monday. Japan’s inflation data remains a key focus for traders, with the Liberal Democratic Party (LDP) official and leadership candidate Sanae Takaichi noting that domestic inflation, excluding external factors, remains weak. Gold Prices Under Pressure Gold prices turned south in the late American session on Friday, closing the week slightly below the $2,500 mark. XAU/USD continued to stretch lower on Monday, with prices last seen trading just below $2,490. The downward pressure on gold is largely attributed to the USD’s resilience and the market’s cautious stance ahead of key economic events. Despite the pullback, gold remains sensitive to shifts in risk sentiment, and any escalation in geopolitical tensions or signs of economic weakness could revive demand for the safe-haven asset. Conclusion As the week unfolds, the US Dollar’s performance will be closely tied to the outcomes of the US inflation data and the ECB’s policy announcement. Major currency pairs, including EUR/USD, GBP/USD, and USD/JPY, are likely to experience heightened volatility as traders digest these key events. Gold, meanwhile, will remain in focus as a barometer of market sentiment, with its price movements reflecting the broader risk environment. Investors are advised to stay alert to these developments as they could set the tone for the financial markets in the days ahead.

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Analysis Commodities Fundamental Analysis Gold Market Forecasts

Gold Price Under Pressure Below $2500 Amid Stronger USD; Downside Limited

Gold Price Under Pressure Below $2500 Amid Stronger USD; Downside Limited Gold (XAU/USD) has been struggling to maintain its position above the $2,500 psychological mark, facing selling pressure for the second consecutive day. The precious metal remains under pressure as the stronger US Dollar (USD) gains traction, following a mixed US Nonfarm Payrolls (NFP) report. While the downside seems limited, the market remains cautious as various factors, including US economic concerns and geopolitical tensions, continue to influence gold’s price movements. Factors Contributing to Gold’s Recent Performance Stronger USD Weighs on Gold One of the primary factors exerting downward pressure on gold is the recent strength of the USD. The mixed NFP report, released by the US Bureau of Labor Statistics (BLS), has reduced the likelihood of a larger rate cut by the Federal Reserve. This has led to a modest recovery in US Treasury bond yields, which in turn, has bolstered the USD. A stronger dollar typically makes gold less attractive to investors holding other currencies, as it raises the cost of purchasing the non-yielding yellow metal. Impact of US Nonfarm Payrolls Report The August NFP report showed an increase of 142,000 jobs, falling short of the expected 160,000. However, the unemployment rate edged lower to 4.2% from 4.3% in July, and wage inflation, as measured by the change in Average Hourly Earnings, rose to 3.8% from the previous 3.6%. Despite the weaker-than-expected job growth, the labor market’s overall resilience led to reduced expectations of a larger rate cut by the Fed, further supporting the USD and contributing to gold’s downward movement. Geopolitical Tensions and Economic Slowdown Concerns Despite the pressure from a stronger dollar, gold has found some support due to growing concerns about a potential US economic slowdown. The rather unimpressive NFP report has fueled fears of an economic downturn, which has tempered investors’ appetite for riskier assets. Moreover, the ongoing geopolitical tensions, particularly the lack of progress in ceasefire negotiations between Israel and Hamas, have also bolstered demand for safe-haven assets like gold. Market Sentiment and Future Outlook Mixed Market Sentiment The market’s current sentiment towards gold is mixed, reflecting the uncertainty surrounding the future direction of the precious metal. On one hand, the stronger USD and reduced bets on a larger rate cut by the Fed present headwinds for gold. On the other hand, concerns about the US economy and geopolitical risks provide a cushion for any potential downside. This tug-of-war has resulted in gold’s price oscillating within a familiar range over the past few weeks, as traders await clearer signals for the next directional move. Technical Analysis: Gold Price Support and Resistance Levels From a technical perspective, gold has traded within a range, forming a rectangle pattern on short-term charts. This pattern indicates indecision among traders, who remain uncertain about the next leg of gold’s directional move. However, this range-bound activity could also be seen as a bullish consolidation phase, following the strong rally that brought gold close to its all-time peak. Key Support Levels: Key Resistance Levels: Market Movers: Key Factors to Watch As gold continues to trade within a tight range, several key factors could influence its price movement shortly: US Economic Data: Investors will closely monitor upcoming US economic data releases, particularly those related to inflation, consumer spending, and labor market conditions. Any signs of economic weakness could prompt a shift in market expectations regarding the Fed’s monetary policy, impacting the USD and, consequently, gold. Federal Reserve Policy: The Fed’s upcoming policy decisions, particularly regarding interest rates, will be crucial in determining the direction of the USD and gold. If the Fed signals a more dovish stance, it could weaken the USD and provide a boost to gold prices. Geopolitical Developments: Ongoing geopolitical tensions, particularly in the Middle East, will continue to play a significant role in shaping market sentiment. Any escalation in conflicts or disruptions to global supply chains could increase demand for safe-haven assets like gold. China’s Economic Performance: China’s economic data, particularly related to inflation and industrial production, will also be closely watched by gold traders. Any signs of economic weakness in China could increase demand for gold as a safe-haven asset. Conclusion Gold prices remain under pressure below the $2,500 mark, with a stronger USD acting as a headwind. However, the downside seems limited due to concerns about a potential US economic slowdown and persistent geopolitical tensions. The market is currently in a state of indecision, with gold trading within a familiar range. Traders should exercise caution and closely monitor key support and resistance levels, as well as upcoming economic data and geopolitical developments, for clues on the next directional move in gold prices.

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