Technical Analysis Today

[Zerologic]

Gold prices returned to moderate gains around $2660

Yesterday the price of gold rose drawing a bullish candlestick from a low of $2638 to a high of $2668. The rise in this precious metal benefited from sentiment to avoid geopolitical risks and easing demand for the US Dollar.

The moderate movement in Gold prices may be due to investors waiting for the Fed's new policy on interest rates. Several Fed officials have made statements but have not given any new clues regarding the next direction of monetary policy. A largely neutral speech does not mean dovish or hawkish in the current view that the central bank will cut interest rates by 25 basis points at its November 7 meeting. According to the CME group's FedWatch tool, the current forecast for a 25 bps cut is 90.6%, and the rate forecast is unchanged at 9.4%.

Even though gold still has the potential to continue its upward trend, several analysts stated that there are many obstacles for gold, including Chinese stimulus, a strengthening dollar, a weakening euro, and also profit-taking. Data from China has a double impact, weak data reduces demand for gold, but a broader economic slowdown could hurt the market.

 

[Zerologic]

AUDUSD drops awaiting Australian employment data

AUDUSD prices yesterday extended their decline amid traders waiting for Australian employment data which will be released today.

AUDUSD fell to form a low of 0.66579 and a high of 0.67042 on the FXOpen platform extending the previous decline. The decline in AUD was also caused by market sentiment avoiding risk amid hopes that former Donald Trump would win the upcoming election. Trump supports a closed economic culture that impacts risk-sensitive currencies.

On the other hand, the dollar index (DXY) extended its gains to 103.524 amid speculation that the Fed would cut interest rates in November. According to the CME group's FedWatch tool, the 4.50%-4.75% cut has risen by 94.1% and the forecast 4.75%-5.00% cut is only 5.9%. A cut in interest rates would probably cause the currency to weaken.

Today investors will focus on several important news Retail sales and Unemployment claims US and Australian employment data.

Australia's Employment Change is forecast at 25.2k from previous data of 47.5k, while the Unemployment Rate is forecast to remain unchanged at 4.2%.

On the other hand, US Core Retail Sales are predicted to be the same as previously at 0.1%. Retail sales are predicted to increase 0.3% from the previous 0.1%. Meanwhile, Unemployment Claims is predicted to be 241k from the previous 258k.

 

[Zerologic]

EURUSD plunged after the ECB cut interest rates by 25 basis points

EURUSD prices have extended yesterday's decline following the ECB cutting interest rates by 25 bp. EURUSD price fell to a low of 1.08104 from a high of 1.08788, candle closing at 1.08294.

At yesterday's meeting, the ECB reduced the Rate on Deposit Facility by 25 basis points (bp) to 3.25%, as expected. Likewise, the Main Refinancing Operation Interest Rate was reduced by 25 bp to 3.4%. This is the second 25 bp rate cut by the ECB in a row. The ECB is predicted to cut its benchmark interest rate by another 25 bp in December.

The statement by the President of the European Central Bank (ECB) Christine Lagarde shows that price pressures in the European zone are under control. He also could not confirm the possibility of cutting interest rates in December and the decision will be based on incoming data.

On the other hand, the USD strengthened due to speculation over Trump's victory and expectations of the Fed cutting interest rates heavily in November. Retail sales data also added to USD strength even though unemployment claims data was as expected. If Trump wins the election, it is expected to result in higher tariffs on imports from Asian and European countries, tax cuts, and an easing of financial conditions.

Meanwhile expectations of the Fed cutting interest rates by 50 bp are now down 86.2% and the forecast for unchanged interest rates is 13.8% according to the CME Group's FedWatch tool.

 

[Zerologic]

Why is the price of Silver surging but not setting a new all-time high?

Last week we witnessed the rise in gold prices which again set a new all-time high for the umpteenth time in 2024. And last week we also saw the price of Silver rise from a low of 31,678 to a high of 33,751. The increase in Silver prices during this day drew a long-body bullish candlestick almost without a shadow. Only tens of pips difference between the highest price and the closing price.

However, the soaring price of Silver has not set a new all-time high, even though it will be the highest throughout 2024. If we pull the monthly chart back, the all-time high price of Silver was set in 2011 in April at $49.21 per ounce. The soaring silver price at that time was due to concerns about monetary inflation and government solvency in developed countries, especially in the Eurozone.

According to Morgan Stanley, Silver investments are more volatile than gold, with half of Silver used in heavy industry and high technology, including smartphones, tablets, car electrical systems, solar panels, and many other products and applications, according to the World Silver Survey. Silver prices are also cheaper than gold.

Even though Silver is more widely used in industry, analyst still predicts an increase in demand in the industrial sector next year as achieved in 2023 when industrial take of 654.4 million ounces reached a record high.

 

[Zerologic]

Gold price rebounded after reaching a new ATH of $2740

On Monday, the gold market price resumed its rise and reached a record high of $2740.34 from an open price of $2717.80 with a low of $2713.83. The soaring gold price is thought to be due to increasing demand for safe-haven assets amidst the deepening Middle East conflict. Israel steps up attacks in Beirut and prepares to launch a retaliatory attack against Iran. Meanwhile, Yahya Sinwar, the leader of Hamas, was reportedly killed by Israeli Markava tank fire. On the other hand, Lebanon attacked Israel with 200 missiles which made warning sirens sound in Israeli territory.

Apart from the Middle East conflict, gold also getting support from steps taken by the People's Bank of China (PBoC) to further loosen credit conditions by lowering interest rates. The PBoC's move to reduce the one-year and five-year principal loan interest rates not only has an impact on increasing the attractiveness of gold but also on greater demand for gold from Chinese investors who are the largest market for this precious metal commodity.

However, further increases were hindered after gold reached a record high of $2740, gold prices fell due to gold profit-taking and brought it down to around $2719.

The forecast for the Fed to cut interest rates by 50 bp according to the CME Group's FedWatch Tool increased by 86.8%, while the forecast for interest rates was unchanged at 13.2%.

Today, apart from the IMF meeting which discusses global economic issues, BRICS also held an annual meeting which also discussed global economic, political, and security issues.

 

[Zerologic]

USDCAD hovers ahead of BOC interest rates

USDCAD price hovers near 1.38500 resistance ahead of today's BOC interest rate announcement. Yesterday the price drew a small body bearish candlestick with a high of 1.38370 and a low of 1.38129 indicating a low volatility market. The bullish sentiment seems to be fading somewhat ahead of the BOC rate call.

The BOC is predicted to cut interest rates by 50 bp from the previous 4.25% to 3.75%. Looking at Canadian inflation data in 2024 from the declining first and second quarters gives hope that the expected 50 bp rate cut may become actual. CPI inflation in the first quarter showed 2.8 and fell in the second quarter by 2.7. Meanwhile, Chain price index for GDP data rose from 3.5 in the first quarter to 3.9 in the second quarter.

On the other hand, the uncertainty of the US election still raises questions about who will be the winner. Although Trump may emerge as the winner, market sentiment is still nervous.

Today investors will focus more on the BOC's monetary and interest rate reports which can have a direct impact if the actual data differs greatly from expectations.

 

[Zerologic]

EURGBP rises ahead of PMI data release

Yesterday's EURGBP price rose drawing a long body bullish candlestick and there was a shadow at the bottom of the candle. The price formed a low of 0.83028 and a high of 0.83441 and moved up near the middle band line.

The pair faces challenges due to market rumors that the ECB will cut interest rates again in December. The rumors emerged after Reuters reported on Wednesday that European Central Bank (ECB) policymakers had begun debating whether interest rates would need to fall below neutral levels during the current easing cycle. Currently, the ECB interest rate is 3.40%, which has decreased from the previous 3.65%.

Sterling also faces headwinds following falling consumer and producer inflation rates, along with weak labor market data in the UK, which boosted hopes of the Bank of England cutting interest rates by 25 bp in November. The BoE interest rate is currently still at 5.00%.

Investors today will focus on several important news events from BOE Governor Andrew Bailey's speech which could provide clues to a hawkish or dovish statement. Apart from that, investors will also focus on PMI data from several European countries, the US and the UK.

 

[Zerologic]

USDJPY declines when DXY falls

Yesterday's upward trend in USDJPY paused and the price drop drew a bearish candlestick with a high of 152,822 and a low of 151,809. Even though it dropped, it still formed a lower high. The decline in USDJPY prices is in line with the decline in the dollar index (DXY ) from 104,455 to 104,012.

Bullish sentiment for the USDJPY pair has started since mid-September 2024 after the price touched a low of 139,572, gradually the price tends to rise with higher highs and lower highs. The rising trend in the Japanese Yen exchange rate has given rise to speculation about the possibility of the central bank carrying out currency intervention. This is implied by comments from Finance Minister Kato who stated, that we are seeing rapid and unilateral movements in the forex market and will monitor it with a strong sense of urgency including keeping an eye on speculative trading.

On the other hand, the BOJ may not raise interest rates after slightly dovish guidance from Governor Kazuo Ueda who stated that when there is great uncertainty, you usually want to proceed cautiously and gradually. The statement implies that BoJ needs more time to gain confidence that inflation can sustainably reach its 2% target.

Meanwhile, the Fed is predicted to continue the path of reducing interest rates at a moderate pace. According to the CME group's FedWatch tool, the probability of a 50 bp cut is up 95.5%, while the probability of interest rates remaining unchanged is only 4.5%.

Today there is no high-impact news related to the USDJPY pair, but Friday's market may experience a little turmoil before market closing.

 

[Zerologic]

There was a gap in USDJPY at market opening, the Japanese election was the reason

USDJPY price at market opening opened much higher than last week's close with one candlestick jumping with a gap above the previous candlestick. Even the USDJPY gap appears on the daily timeframe.

Last week's closing price was USDJPY at 152.291, while Monday's opening price was at 153.166 on the FXOpen platform. One of the reasons for the weakening of the Japanese Yen against the US Dollar was the Japanese election on October 27 last Sunday. Preliminary results show that the Liberal Democratic Party (LDP) failed to obtain a majority of votes. If the vote results do not change, this would be the LPD's first defeat in 15 years and a blow for Prime Minister Shigeru Ishiba who has only been in office for one month.

On the other hand, the data report released Thursday showed a contraction in business activity as gross as manufacturing, and also a decline in the core inflation rate below the BoJ's target of 2% has dampened expectations of further interest rate increases in 2024, also putting pressure on the JPY. Tokyo's headline Consumer Price Index (CPI) rose 1.8% YoY in October compared with 2.2% in the previous month. Meanwhile, Core CPI, which excludes fresh food prices, grew 1.8% in October, down from 2% in the previous month but slightly above market expectations of 1.7%.

Meanwhile, speculation of less aggressive Fed easing supports USD buyers and pressures JPY. The Fed is expected to lower interest rates at its November meeting. According to the CME group's Fedwatch tool today, the probability of the Fed cutting interest rates by 25-50 bp is 97.7% and a decrease of 0-25 bp is only 2.3%. This forecast allows the Fed to cut interest rates by 50 basis points at its next meeting.

 

[Zerologic]

Steady gold prices are still moving within the previous range

Gold prices on Monday drew a small bullish candle after a bearish gap occurred on Monday morning at market opening. The gap is faintly visible on the daily timeframe, but clear on the hourly timeframe. The gap occurs because the open price at $2735 is lower than the closing price of the previous candle at $2746. Gold has now formed a low of $2724 and a high of $2745.

Gold's bullish trend on Monday weakened amid reports of weak Chinese demand. data released by the China Gold Association (CGA) shows a decline in demand from the world's largest consumer of Gold in the first three quarters of 2024, compared with the same period last year. Total consumption was 742 tonnes between January and September, which was 11.18% lower than the same period last year. Gold jewelry consumption in China fell 27.53%, to 400 tonnes when compared with the same period in 2023. Gold used in industrial processes reached 59 tonnes, down 2.78%.

On the other hand, precious metals are still supported by safe-haven flows amidst the Middle East conflict which is still ongoing with uncertainty as to when it will end. After Israel launched a retaliatory attack on Iran, Iran's leaders responded by retaliating against the attack, allowing the conflict to continue.

Furthermore, uncertainty over the outcome of the US Election and expectations of the Fed cutting interest rates in November also support the attractiveness of gold as an asset that does not give yields.

In general, gold is negatively correlated with USD, today investors are focusing on several high-impact news, CB consumer confidence, and JOLTS Job Openings.

 

[Zerologic]

AUUSD extends losses ahead of Australian inflation data

AUDUSD price yesterday drew a bearish candlestick extending the bearish sentiment of the previous day. Price drew a bearish candle with a slight shadow at the bottom of the candle with a low of 0.65445 and a high of 0.65850 closing at 0.65597.

The reason behind the decline in AUDUSD prices is the strengthening of the USD which puts more pressure on risk assets, including the AUD. Apart from that, uncertainty about the effectiveness of China's stimulus continues to contribute to the Australian Dollar.

The RBA interest rate is now at 4.35%, Governor Michele Bullock's dovish statement may leave interest rates unchanged in the near term. Current market sentiment reflects a 50% probability of a 25 basis point rate cut by the end of the year.

On the other hand, expectations of the Fed's interest rate cut may provide support to the AUDUSD pair.

Today investors will focus on Australian CPI data which may have a short-term influence. CPI in this quarter is expected to fall 0.3% from the previous 1.0%. Meanwhile, year-on-year CPI is expected to fall 2.3% from the previous 2.7%.

 

[Zerologic]

Silver prices fall when gold rises

In Wednesday's trading, Silver drew a bearish candlestick with a shadow at the bottom of the candle. The price formed a low of 33,404, a high of 34,517, the price closed at 33,749. Wednesday's low was lower than Tuesday's low despite afterward buyer pressure.

On the other hand, the Gold price continued its rise and drew a bullish candlestick with a small body, forming a low of $2770 and a high of $2789. Gold and Silver tend to have a positive correlation, but there seems to be a demand anomaly between the two at the moment, even though in the long term, they still tend to be in the same direction.

The anomaly in Gold and Silver prices may be due to consolidation in China's solar industry and slower growth, which will hamper Silver in the short term.

Meanwhile, investors will wait for the Fed's policy which is predicted to cut interest rates in November. According to the Fedwatch tool, the possibility of the Fed cutting interest rates by 25-50 bp is 95.6%, and the forecast for unchanged interest rates is only 4.4%.

Today investors are also waiting for China's economic data, Manufacturing PMI is forecast at 49.8, the same as the previous revision. And US economic data, the Employment Cost Index, is predicted at 0.9%, the same as the previous revision.

 

[Zerologic]

CHF strengthened when USD depreciated ahead of NFP data

USDCHF drew a bearish candle on Thursday with a low of 0.86323 dropping from a high of 0.86659. Even though USDCHF fell, overall it was still within the price range of the previous week. The CHF currency is considered a safe-haven currency because of Switzerland's status as a country with a strong and stable economy and also its neutral political stance in global conflicts so investors tend to buy the CHF currency to hedge.

Yesterday's US PCE data showed a value of 0.3%, the same as expected, 0.3% higher than the previous revision of 0.2%. Meanwhile, the US Employment Cost Index data was 0.8% lower than expected, 0.9% from the previous revision of also 0.9%. Unemployment Claims data showed 216k smaller than the expected 229k from the previous revision of 228k.

According to the CME group's Fedwatch tool, the Fed's target rate possibilities at the next November 7 meeting, the Fed a cut of 25-50 bp is 94.2%, while the possibility of interest rates remaining unchanged is only 5.8%.

Today investors will focus on NFP data which is expected to fall by 106k from the previous data revision of 254k. Large differences in actual data and forecasts may cause volatility in the short term.

 

[Zerologic]

Bullish gap EURUSD price back near the previous high

In trading earlier this week, the EURUSD price opened at 1.08739, much higher than last Friday's closing price at 1.08309. The bullish gap is also clearly visible on the H4 timeframe.

It seems that the time approach of the US elections which will be held on November 5 provides support for the strengthening of the USD. The US dollar index (DXY) is now at 104.317 up from 103.679. It is not yet known who will be the winner of the US election, the ABC News poll results also show a tight competition between Trump and Harris with Harris' poll results being slightly superior to Harris's with 47.9% for Harris and 46.9% for Trump.

Apart from the US election, another factor driving the USD is the US employment report data. The NFP report indicated that estimated employment payrolls for several industries were affected by the hurricane, which was identified on the Florida Gulf Coast on September 26, 2024. NFP data was 12k smaller than the expected 106k, while the Unemployment Rate was 4.1% the same as the previous period's revision. Meanwhile, ISM Manufacturing PMI 46.5 was smaller than expected 47.6 smaller than the previous revision 47.2.

In the future, investors will also pay attention to the Fed's interest rates, which are predicted to cut interest rates by 25 bp from the previous 5.00% to 4.75%. According to the FedWatch tool, the possibility of the FED cutting interest rates by 25-50 bp is 95.4% and the possibility of interest rates remaining unchanged is only 4.6%.

Today there doesn't seem to be any high-impact news on the economic calendar, in Japan the bank holiday commemorates Culture Day which allows the Tokyo session to be affected by this bank holiday.

 

[Zerologic]

Gold prices remain steady above $2728 ahead of the US election

The price of gold on Monday formed a small candle like a Doji which indicates an indecision market. Even though it tends to fall, the decline is still stuck above the price level of $2728. The price formed a high of $2747 and a low of $2729 to close at $2735. Investors are still waiting for the US elections to be held today.

Gold got a slight boost from a weaker USD as bets on a Trump win were reduced. Analysts estimate that Trump's victory could have an impact on gold because Trump's policies might maintain high interest rates thereby increasing foreign capital inflows.

However, ahead of this election, the USD weakened, ABC News poll results showed Harris leading 48.0% while Trump polled 46.8%. Although it is not certain that the poll results are correct, this has caused bets on Trump to decrease.

On the other hand, the Fed might cut interest rates by up to 50 bp, which could trigger demand for gold because it is considered a safe-haven asset that does not provide returns. According to the FedWatch tool, the probability of the Fed cutting interest rates by 50 bp is 98.0% and the probability of interest rates remaining unchanged is only 2.0%.

Geopolitical risks are currently still a topic of discussion that can encourage gold as a safe-haven option amidst global uncertainty. After Israel attacked Iran, it seemed that tensions were continuing, Iran's leader, Ayatollah Ali Khamenei, said that anything that disturbed Iran's security would get a devastating response, and maybe they would even change their nuclear policy if Israel and the US as their main allies attacked Iran.

Today's important economic data may be of concern to the market, ISM services, Presidential elections, and Congressional Elections.

 

[Zerologic]

In the midst of the US election NZDUSD jumped from 0.59662 to 0.60145.

The US election has been taking place since November 5 with a tight competition between Kamala Haris and Donald Trump. The NZDUSD pair drew a bulls candle yesterday with a low of 0.59662 and a high of 0.60145 and closed at 0.60054 below the middle band line.

As is known, NZD is one of the commodity currencies that is influenced by their commodity exports, so the US election is crucial for this currency because the change of president may differ in the economic policies implemented.

New Zealand is China's trading partner, if Trump becomes the winner of the election, it could be less supportive of New Zealand's partnership with China because Trump promised to levy 60% import tariffs on China if he wins, which would increase risks to economic growth.

Meanwhile, analysts estimate that the Reserve Bank of New Zealand (RBNZ) will cut interest rates again by 50 basis points at its last monetary policy meeting this year on November 27.

New Zealand employment data released today showed the actual data was 4.8% smaller than the expected 5.0%, although it was higher than the previous revision of 4.6%. Less actual data good for currency. Meanwhile, the Change in the number of employed people report shows -0.5% smaller than expected -0.4% from the previous revision of 0.2%. actual data is lower than expected which is less good for the currency.

 

[Zerologic]

GBPUSD plunges as Trump wins the US presidential election.

Trump's victory in the 2024 US presidential election has had a strong impact on the USD. It was observed that the USD strengthened in all currency pairs after Trump won over Kamala Harris. From the Associated Press, Trump currently gets 72,083,871 votes (51%) and Harris gets 67,274,910 votes (47.6%).

The USD strengthened, including the British Pound Sterling which yesterday plunged from a high of 1.30471, dropping to 1.28333. The price forms a bearish candle with a long body and a shadow at the bottom of the candle. Price falls from above crossing the middle band line and breaking the lower band line.

Trump's promise of an aggressive expansion of US tariffs on all cross-border trade has caused the USD to strengthen against other currencies. Trump has vowed across-the-board tariffs of 10% to 20% on all imports coming into the United States and tariffs of 60%-100% on Chinese imports.

Apart from the US election results which are in the spotlight, the Fed and BoE policies which are predicted to cut interest rates are also the focus of the GBPUSD pair.

Today the Bank of England (BoE) will make a decision on interest rates, which are expected to cut by 25 basis points from 5.00% to 4.75%.

 

[Zerologic]

USDCAD failed to continue its upside rally and fell ahead of the Fed's decision

USDCAD price yesterday drew a bearish candle with a high of 1.39474 and a low of 1.38414 and closed at 1.38621 on the FXOpen platform.

Previously, the USDCAD pair had a strong rally from a low of 1.38131 to a high of 1.39578 due to the influence of Trump's victory in the US elections held on November 5. However, the rally paused and was turned down yesterday.

Ahead of the Fed's interest rate announcement, USDCAD had started to show its decline, and there was no turbulence after the Fed cut interest rates by 25 basis points at 4.75% as expected from the previous 5.00%.

The dollar index (DXY) formed a similar pattern, after rising due to Trump's victory yesterday, falling at 104.187 from a high of 105.252, down around 0.75%.

Next, investors will focus on Canadian employment data which will be released today. Employment Change is predicted to fall to 27.9k from the previous 46.7k, while the Unemployment Rate is predicted to rise to 6.6% from the previous 6.5%.

 

[Zerologic]

Silver prices fell amid the cryptocurrency market Bullrun

Trump's victory in the 2024 US election has had a broad impact on financial markets. Apart from having an impact on strengthening the USD, it is also the reason for the Bullrun in the crypto market. The dollar index (DXY) is now at 104.951, up 0.57%. Meanwhile, in the crypto market, many crypto coins experienced significant prices including Bitcoin in 7 days rising more than 15%, Ethereum 28%, Solana, 26%, Doge 78%, ADA 78%, with almost all crypto coins experiencing price increases.

However, amidst the bull run in the crypto market, the price of Silver actually fell. In Friday's trading, Silver drop formed a bearish candle with a high of 32,059 and a low of 31,184 and closed at 31,295.

Silver and gold are often positively correlated, these two precious metals often move side by side even though there are different movement anomalies. After Trump was confirmed to have won the US election, gold and silver prices fell sharply because Trump's policy of increasing tariffs by 50% for Chinese traders weighed on gold and silver, where China is one of the largest importers of gold and silver globally. However, China is also the second largest silver-producing country after Mexico, in 2022 Mexico produced 5,600 MT and China produced 3,400 MT based on statistics based on the US Geological Survey.

With Trump's promise of an inward economic policy, it could revive the trade war with China, which in fact currently dominates popular international trade with cheaper prices, thereby threatening the domestic economy.

Today on the economic calendar investors may only wait for New Zealand inflation data which is not much related to Silver, while banks in Canada and the US are closed today which could affect market liquidity.

 

[Zerologic]

Gold prices plunge to a low of $2610, the Trump effect weighs on gold

Gold prices on Monday fell sharply extending previous declines. Gold price drew a bearish long-body candle with a high of $2685 a low of $2610 and a close at $2618. Gold price crossed the lower band and MA 50 indicates a sharp decline.

The price of gold experienced a significant decline after Trump won the 2024 US presidential contest. Several reasons caused the price of gold to fall, including the strengthening of the USD, increasing performance on the US stock market, increasing performance of Bitcoin, Donald Trump's claim that he wants to end the Middle East conflict, and the possibility of the Fed holding down interest rates due to high fiscal deficit.

Trump's promise to increase trade tariffs is also predicted to increase the price of goods and inflation which could slow the Fed from lowering interest rates.

In the crypto market, the performance of Bitcoin and its friends also weighed on gold. Bitcoin just hit a new record high of $82k, due to expectations that Trump will loosen crypto regulations. Gold experienced a decline because perhaps portfolio managers switched to riskier assets.