Weekly Technical Analysis for Major Currency Pairs, Commodities,

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In light of the release of U.S. inflation data, which showed that inflation remains under control with signs of slowing down, along with data revealing a decline in the labor market—an outcome the Federal Reserve aims for—and with the rapid escalation of geopolitical events and the emergence of unexpected confrontations, it is crucial to discuss the impact of these developments on global markets.

In this week’s episode of the weekly technical and economic analysis for gold, major currency pairs, key commodities, and indices for the period from Monday, October 14 to Friday, October 18, 2024, we will discuss all the related analyses regarding gold and financial markets, as well as the upcoming economic and geopolitical events for the week. Through technical analysis, we will review the expected trends in the markets, including gold, the U.S. dollar, and crude oil, and how these assets will be affected in light of the current tense conditions.

Economic and Geopolitical Analysis:

This week, we anticipate a series of important data releases, starting on Tuesday, October 15, with the Canadian Consumer Price Index (CPI) followed by the British CPI on Wednesday. On Thursday, we have very important data for the Euro, including the CPI and the interest rate decision from the European Central Bank. For the U.S. dollar, we will see key data like Core Retail Sales, which measure consumer spending levels. If these figures come in stronger than expected, it could drive the dollar higher, negatively impacting gold due to their inverse relationship. Additionally, we will see jobless claims and the Philadelphia Manufacturing Index. Any positive readings indicating growth in the industrial sector could support the dollar and put pressure on commodities.

We also have the U.S. crude oil inventory report, which plays a key role in determining oil prices and in turn impacts other markets. Current forecasts suggest that these data releases will significantly affect currency markets, gold, and indices.

On the geopolitical front, tensions in the Middle East continue to play a significant role in market movements. The escalating confrontations may lead to increased demand for gold as a safe haven. At the same time, the potential for widening conflicts could drive oil prices higher due to supply disruption fears. These tensions may support gold and oil in the short term while putting pressure on U.S. stock indices, which could see some decline due to heightened geopolitical risks.

Technical Analysis:

U.S. Dollar Index (DXY):
The U.S. Dollar Index has reached the critical level of 103. So far, the index has been unable to break past this level due to inflation data showing signs of slowing, which has capped dollar gains. The positive scenario expects a continued rise above 103, potentially pushing the dollar to 104.500 and 106. However, if it fails to break 103, the index may face selling pressure, retreating to 102 and 100.5.

Currency Pairs:

• EUR/USD: Prices staying below 1.10300 keep the pair under pressure. If the critical support level at 1.09300 is broken, we may see a decline towards 1.08000 and 1.07000.
• GBP/USD: Prices remaining below the 55-day moving average and under the 1.30500 level strengthen the bearish outlook. If 1.301500 is breached, the pair could fall towards 1.29100 and 1.28500.
• USD/JPY: Stability above 148 yen supports a positive outlook towards 153 and 158 yen.
• USD/CHF: The pair faces corrective pressure, and if prices stay below 0.86000, we may see a drop towards 0.85000.
• AUD/USD: Breaking the 0.76050 level could lead to losses towards 0.67500 and 0.66000.
• NZD/USD: Prices hovering around 0.61000 support the bearish scenario, and breaking this level could drive prices towards 0.60000 and 0.59000.
• USD/CAD: If the pair surpasses 1.30900, we may see an upward wave targeting 1.30600 and 1.30500.
• GBP/JPY: Breaking 196 yen could drive the pair towards 200 and 205 yen.
• EUR/JPY: Prices remaining above 164 yen strengthen the positive outlook towards 167 and 170 yen.
• EUR/GBP: Staying below 0.80800 could lead to declines towards 0.83000 and 0.82000.
• USD/TRY: Prices stabilizing above 34 lira support the upward trend towards 34.50 and 35 lira.

Cryptocurrencies:

• BTC/USD: Bitcoin stabilizing above $60,000 could push it towards $65,000, and if that level is broken, it could rise towards $72,000 and $80,000.
• ETH/USD: Prices stabilizing above $2300 could drive Ethereum towards $2600.
• XRP/USD: Prices stabilizing above 55 cents may support a move towards 65 and 80 cents.

Commodities:

• Gold: Staying above $2,640 per ounce supports a rise towards $2,690 and $2,740.
• Silver: Prices staying above $30.50 support a rise towards $32.50.
• Crude Oil: Prices staying above $74 per barrel may support a positive move towards $80 and $86 per barrel.
• Natural Gas: Breaking the $2.50 level could lead to declines towards $2 and $1.40.

Global Indices:

• Dow Jones: Surpassing 42,250 points could push the index towards 43,000 and 44,000 points.
• S&P 500: Prices staying above 5,700 points support a rise towards 5,850 and 6,000 points.
• Nasdaq: Breaking 20,400 points could drive the index towards 21,000 and 21,800 points.
• Russell 2000: Surpassing 2,225 points could drive the index towards 2,300 and 2,400 points.
• FTSE: Prices staying above 8,200 points may support a rise towards 8,400 and 8,600 points.
• DAX: Prices staying above 19,200 points support a rise towards 19,700 and 20,200 points.
• CAC: Breaking 7,600 points could push the index towards 8,000 and 8,400 points.
• Nikkei: Stability above 39,000 points supports a rise towards 41,000 and 43,000 points.

Conclusion:

Considering the anticipated data releases and technical analysis, we expect a week filled with volatility. We advise traders to focus on the movement of the dollar and gold, as these data will determine the direction of the markets for the upcoming week. Regarding geopolitical tensions, they may create new opportunities for gold to rise.

We recommend focusing on the critical data expected on Thursday, October 17, including Core Retail Sales and unemployment claims, which could have a significant impact on the markets.

Best regards, and see you in the next analysis.