Forex market today

[Polakandil]

Gold prices fall drawing lower lows

Yesterday's gold price finally fell, drawing lower lows after several days of trading moving in a range.

Yesterday the price of gold reached a high of $2652 and a low of $2605. The candlestick opens at $2642 and closes at $2521 crossing the middle band line from the upside.

The decline in gold prices is predicted due to the rise in the US dollar following solid economic data and reduced speculation of a major interest rate cut by the Fed.

Besides that, the Chinese Central Bank (PBoC) reported unchanged gold reserves of 72.8 million ounces (2,264 tons) at the end of September, which means that the Chinese Central Bank did not buy gold even though the central banks of other countries such as India, Türkiye, and Poland continued to buy gold.

From another angle rising tensions in the Middle East weigh on speculative interest.

Today the Federal Open Market Committee (FOMC) will announce the minutes of its September meeting. But the minutes may not be a shocking document after Fed officials' comments flooded the news following the extraordinary NFP report. Meanwhile, on Thursday the US will release the Consumer Price Index (CPI) for September with a Core CPI forecast of 0.2% from the previous data revision of 0.3%.

 

[Polakandil]

Reserve Bank of New Zealand keeps interest rate at 4.75%, USDCAD extends hikes.

USDCAD yesterday drew a long body bullish candlestick with slight shadows on the top and bottom of the candle. USDCAD price formed a high of 1.37180, and a low of 1.35318 on the FXOpen platform. USDCAD climbed higher after breaking the upper band line at 1.36477.

At yesterday's meeting, the RBNZ decided to maintain interest rates at 4.75%. This decision appears to still cause the CAD to weaken further against the USD due to strong demand for US dollars caused by previous US economic data.

In the summary of the October 2024 meeting, members of the Monetary Policy Committee agreed that the stance of monetary policy has been consistent with ensuring low and stable inflation. New Zealand's annual consumer price inflation is assessed to currently be within the Committee's 1 to 3 percent target band and is expected to converge to the target midpoint.

Today investors will focus on the FOMC Meeting Minutes which will determine the direction of US interest rate policy in the future.

 

[Polakandil]

USDCHF fell still within the range when the US CPI data was released

Yesterday the USDCHF price drew a bearish candlestick with a small wick on the top candle. The price formed a high of 0.86138 and a low of 0.85568 on the FXOpen platform. Even though the price is falling, the movement is in the range between the middle and upper band lines.

Yesterday's US economic data showed core CPI 0.3% greater than the forecast 0.2%, the same as the previous revision of 0.3%. CPI goods and services purchased by consumers was 0.2% from the forecast of 0.1%, the same as the previous revision of 0.2%. CPI year of year 2.4% from a forecast of 2.3% lower than the previous revision of 2.5%. On the other hand, Unemployment Claims data showed 258k, greater than forecast, 231k from the previous revision of 225k.

Mixed US economic data seems to be one of the reasons for USDCHF's decline yesterday. According to the CME group's FedWatch tool, the target rate probability for the November 7 FED meeting is predicted to be cut by 25 bps at 83.3% and the forecast rate is unchanged at 16.7%.

On the other hand, geopolitical risks in the Middle East still overshadow the uncertainty of global geopolitical risks. If the escalation of war continues, it might increase safe-haven flows that benefit the Swiss Franc.

Today there will still be US economic news releases that may be of interest to investors, core CPI and CPI month of month.

 

[Polakandil]

Silver gapped down seen at Monday's market open

Silver is now traded at around 31,179 on the FXOpen platform. Last weekend Silver prices rose drawing a bullish candlestick with a low of 31,055 and a high of 31,624 extending the previous day's rise.

Silver prices experience a gap down at market opening and can even be seen on the daily timeframe, where the open price is far below the close price of the previous candle.

Last week's summary Silver faced downward pressure by drawing a bearish candle with a long shadow at the bottom of the candle, reflecting the price under pressure and trying to rise again at the end of the week. Briefly Silver prices rose to 32,955 but fell again to 30,119.

The robust US economic data including the labor market and CPI which supports a stronger USD seems to affect the value of Silver because it lifts US Treasury yields making it less attractive for Silver which does not provide yields.

Gold and Silver often go hand in hand, but it seems that Silver's movement is lagging behind Gold, this may be weighed down by weak industrial demand and weak Chinese interest.

Today the Japanese bank holiday commemorates Health-Sports Day, also the Canadian bank holiday commemorates Thanksgiving Day, and the US bank holiday commemorates Columbus Day. Bank holidays can affect transaction volume in the forex market.

 

[Polakandil]

USDCAD extends the increase that started on October 2

Yesterday's USDCAD price was still drawing a bullish candlestick with higher highs and lower highs which reflects a bullish market.

Although Canadian economic data released on Friday showed job growth was higher than expected and showed signs inflation pressures may be easing. However, the market may still doubt the possibility that the Bank of Canada will cut interest rates by 50 bps. Investors may still be watching to see whether the labor market recovery is sustainable.

On the other hand, the dollar index (DXY) shows an increase in value at 103.212 which started at the beginning of October. This increase was also triggered by US economic data last week which showed CPI data rising 0.2% and an increase in payroll employment of 254k in September, although: PPI final demand was unchanged in September. Prices for final demand services increased 0.2 percent, and the index for final demand goods decreased 0.2 percent. Prices for final demand rose 1.8 percent for the 12 months ended in September.

Today investors will focus on Canadian CPI data which may be one of the benchmarks for the BoC in formulating interest rate policy.

 

[Polakandil]

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.

 

[Polakandil]

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.

 

[Polakandil]

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.