enDaily Analysis 12/04/2024
Latest Economic and Fundamental Insights
The dollar index steadied near a five-month high above 105 on Friday and is on track to rise about 1% for the week as traders have retreated from bets on multiple rate cuts by the Federal Reserve this year due to strong US economic data.
Safe-haven gold hits record highs and heads for fourth weekly gain
- Gold hit an all-time high of $2395.29 an ounce
- Silver hits highest level since February 2021
- Silver, platinum and palladium poised for weekly gains
- “The only thing that’s definitely driving central bank gold buying is the wars going on around the world. If you look back through history, that’s always happened because gold is a safe haven,” said analyst Lukman Santos.
Despite recent hot inflation data and a strong US jobs report last week, which raised further questions about the need for rate cuts this year, gold is poised for its fourth straight weekly rise, up more than 15% so far this year.
“We expect gold prices to rise in the next two months. And from a technical perspective, this rally is the result of gold prices breaking out of a 42-month record consolidation period. It’s like a rocket ship being launched now,” said Vincent.
Elsewhere, the European Central Bank kept interest rates at a record high but signaled it could start cutting them as early as June.
Chinese yuan steadies as strong fixing offsets dollar strength
Fed finally leads the race to cut rates
Yen struggles against rising dollar and US Treasury yields
JPMorgan to report Q1 earnings this Friday
Oil rebounds as Middle East tensions persist, but set for weekly loss
- Brent crude trades at $90.00 and West Texas Intermediate crude at $85.00
The gains offset some of the previous session’s losses, which were dominated by concerns about stubborn US inflation that have reduced hopes of an early June rate cut.
Warplanes suspected to be Israeli bombed the Iranian embassy in Damascus in an attack that Iran has vowed to avenge, exacerbating tensions in a region already on edge due to the Gaza war.
Israel has not claimed responsibility for the attack, but Iran’s Supreme Leader Ayatollah Ali Khamenei said on Wednesday that Israel “must be punished, and it will be punished” for the attack.
The United States expects a strike from Iran against Israel, but it will not be big enough to drag Washington into war, according to a US official. Iranian sources said Tehran has signaled a response aimed at avoiding a major escalation.
Bitcoin holds its gains above the $69,200 zone. BTC could gain upside momentum if it breaks above resistance levels of $70,800 and $71,250.
Bitcoin price moves higher above the $71,200 resistance level. BTC shows positive signs and could soon extend its gains above $72,500.
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.
GOLD
General trend: bullish
Time interval: half an hour (30 minutes)
Current price: 2386.52
The first scenario: Buy gold at a break and hold above 2391.84, with a target price of 2398.27 and 2405.60. Alternative scenario: Sell gold at a break and hold below 2380.46, with a price target of 2374.01 and then 2366.66.
Comment: Trading above supports and averages suggests an upward trend
General trend: bullish
CRUDE OIL
Trend: bullish
Time interval: half an hour (30 minutes)
Current price: $85.31 per barrel
The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $85.56, targeting a price of $86.03, then 86.59. Alternative scenario: Selling oil at a break of $84.88, targeting a price of $84.36, then 83.78.
Comment: Trading above supports and averages suggests an upward trend
EURUSD
General trend: – Bearish
Time interval: half an hour (30 minutes)
Current price: 1.07096
The first scenario: sell the euro/dollar at a break of 1.07012, targeting a price of 1.06852, then 1.06639. Alternative scenario: buy the euro/dollar at a break of 1.07239, targeting a price of 1.07424, then 1.07649.
Comment: Trading below resistances and averages suggests a decline
GBPUSD
Trend: down
Time interval: half an hour (30 minutes)
Current price: 1.25396
The first scenario: selling the pound dollar at a break and holding below the level of 1.25265, targeting the price of 1.25068 then 1.24488. The alternative scenario: buying the pound dollar at a breaking point and holding steady by closing above 1.25601, targeting the price of 1.25887 then 1.26108.
Comment: Trading below resistances and averages suggests a decline
NAS100
Trend: down
Time interval: half an hour (30 minutes)
Current price: 18493
The first scenario: Selling the Nasdaq at a break and holding steady with a close below 18455, targeting the price of 18413 then 18370. Alternative scenario: Buying the Nasdaq at a break and holding steady with a close above 18514, targeting the price of 18554 then 18600.
Comment: Trading below resistances and averages suggests a decline
Economic Calendar
(Times are in GMT+3)
China Trade Balance (USD) (March)
Fundamental Analysis
The currency also followed a rise in Treasury yields, as the benchmark US 10-year yield jumped to a five-month high above 4.5%.
Data released on Wednesday showed that US consumer prices accelerated for the second straight month in March, defying expectations of a slowdown in price increases.
Meanwhile, data on Thursday showed that US producer prices rose less than expected last month.
Markets are now pricing in only 40 basis points of total easing from the Federal Reserve this year, down from around 60 basis points at the start of the week.
The dollar’s rise was also bolstered after the European Central Bank decided to keep interest rates on hold on Thursday, but signaled its willingness to cut rates soon.
Gold prices rose on Friday to reach a record high as central bank buying amid geopolitical tensions kept the yellow metal’s momentum, while strong US economic data failed to dent the appeal of bullion.
Oil prices rose on Friday as rising tensions in the Middle East raised the risk of supply disruptions from the oil-producing region, although prices are on track to end the week with losses amid expectations of US rate cuts this year.
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