Daily Price Outlook

The AUD/USD currency pair prolonged its upward rally and gained some further positive momentum on the day. However, this boost came after a decline in the US Dollar and a drop in US Treasury yields. Moreover, Australia's Bureau of Statistics shared some good news for the Aussie economy in August. They reported that the Trade Balance, which measures the country's exports and imports, improved significantly. This means that Australia sold more goods to other countries, and that is great for the Australian Dollar.

Moving on, there are some challenges for the AUD/USD pair. People are being careful because they're not sure what the US Federal Reserve will do with interest rates. Plus, the Reserve Bank of Australia (RBA) is also not very optimistic, and this makes the Australian Dollar weaker. So, while things are good now, there are worries for the future.

Australian Trade Improvements and RBA's Interest Rate Decision

It's important to highlight that in August, Australia sold more stuff to other countries than it bought, and this is good news for the Australian Dollar. In August, their Trade Balance improved a lot, reaching 9,640 million, which was even better than what people expected. In July, it was 8,039 million, so things got better.

However, the Reserve Bank of Australia (RBA) had a meeting recently and decided to keep the interest rate as it is, at 4.10%. But there's a chance they might raise it to 4.35% by the end of the year because prices have been going up a lot, and the RBA wants to control that. The new leader of the RBA, Michele Bullock, said they might need to make money a bit harder to get because prices are still high and might stay high for some time.

Factors Boosting the AUD/USD Pair

Another factor that has been boosting the AUD/USD pair was a dip in the US Dollar Index (DXY) from its 11-month high. This happened because some recent data about jobs in the US wasn't great, and US Treasury yields took a step back. Notably, the US economy's service sector slowed down a bit in September, and the number of new jobs created in the private sector was lower than expected. This news made the US Dollar lose some strength.

However, the major event is still to come: the Jobless Claims and Nonfarm Payrolls reports due on Friday. If those reports are good, the US Dollar could bounce back. This could also make the bond market more unpredictable.

In today's Daily Technical Outlook for AUD/USD on October 5, the currency pair is currently trading at $0.6363 with a 4-hour chart timeframe.

Key price levels include a pivot point at $0.6423, immediate resistance at $0.6511, and subsequent resistances at $0.6591 and $0.6682. On the support side, immediate levels are found at $0.6342, followed by $0.6253 and $0.6173.

Technical indicators show a relatively neutral stance, with the RSI at 51.87, indicating a balanced sentiment. Additionally, the 50 EMA stands at $0.6377, indicating a short-term bearish trend as the price is currently just below this level.

The observed chart pattern highlights the struggle of AUD/USD to breach the 50 EMA, implying a bearish sentiment. As for fundamental news, there are no specific updates to report.

In conclusion, the overall trend for AUD/USD appears to be bearish below the $0.6377 level, with a short-term forecast indicating a continued struggle to surpass this resistance point in the coming days, reinforcing the bearish outlook.

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Daily Price Outlook

During the early European session on Thursday, the USD/JPY currency pair faced some renewed selling pressure. It dropped closer to the 148.00 mark after seeing a small increase in the previous day. This marks the second day of decline in the past three days. However, the reason for its downward trend can be attributed to several factors. Firstly, the Japanese Yen has been strengthening, exerting downward pressure on the pair. Furthermore, the US Dollar is facing some challenges as there is growing uncertainty surrounding whether the Federal Reserve will raise interest rates in the future. This uncertainty is causing the USD to retreat from its recent gains and contributing the losses in USD/JPY pair.

Multiple Factors Behind the Ongoing Decline of the USD/JPY Pair

Another factor that has been pushing the USD/JPY pair down is the growing concerns surrounding global trade tensions. The ongoing trade disputes between the United States and various trading partners, including China, have created an atmosphere of uncertainty in the financial markets. Investors tend to seek refuge in safe-haven currencies like the Japanese Yen (JPY) during times of trade-related uncertainties, which results in increased demand for the JPY and a corresponding decline in the USD/JPY pair.

Meanwhile, the decline in the USD/JPY pair is linked to a Japanese practice called "Gotobi," where certain financial transactions occur on days ending in "5" or "0." This practice can impact currency movements. There's also speculation of Japanese authorities intervening in the foreign exchange (FX) market, especially when the JPY weakened below 150.00 against the USD. As a result, some traders are adjusting their positions accordingly.

US Dollar Dynamics and Impact on USD/JPY Pair

Apart from this, the broad-based US Dollar has been losing some ground after reaching an almost 11-month high earlier this week. The reason for this decline is the disappointing US ADP jobs report released on Wednesday, along with a slowdown in the US services sector. These developments give the Federal Reserve a reason to consider holding off on raising interest rates. When the Fed is less likely to hike rates, it puts pressure on US Treasury bond yields, which in turn weakens the USD.

However, it's important to note that some Fed officials have recently suggested that they may need to tighten monetary policy more to control inflation. The market also expects at least one more rate increase by year-end. This anticipation could support higher US bond yields and the US Dollar, so it's wise to be cautious about making aggressive bearish bets on the USD/JPY pair.

Looking forward, investors may choose to wait before making big moves as they await the important US monthly employment report (NFP) coming out on Friday. Meanwhile, on Thursday, traders will pay attention to the usual Weekly Initial Jobless Claims data from the US.

USD/JPY - Technical Analysis

In today's daily technical outlook for USD/JPY on October 5, the currency pair is currently trading at 148.62 with a 4-hour chart timeframe. Key price levels to note include a pivot point at 149.091, immediate resistance at 149.931, and subsequent resistances at 150.545 and 151.403. On the support side, immediate levels are found at 148.46, followed by 147.619 and 147.006.

Technical indicators paint a bearish picture, with the RSI at 36.3, indicating a bearish sentiment, and the MACD line below the signal line, suggesting potential downward momentum. Furthermore, the price is currently below the 50 EMA, signaling a short-term bearish trend. Despite an observed upward channel providing support at 148.460, the overall indicators are in the sell zone, urging caution and highlighting the importance of monitoring a potential breakout below this level to consider a selling opportunity.

In conclusion, the overall trend for USD/JPY remains bearish below the pivot point of 149.091, with a short-term forecast suggesting continued resistance at specified levels in the coming days, reinforcing the bearish outlook.

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Daily Price Outlook

Despite the strong US dollar, the EUR/USD currency pair is bouncing back after a two-day slide, hovering near a 10-month low reached on Tuesday. It's now trading higher around 1.0480 during early European trading on Wednesday. The rebound is thanks to better-than-expected Eurozone PMI data, which is boosting confidence in the Euro. However, Eurozone Retail Sales didn't fare as well, falling 2.1% YoY in August, worse than the expected -1.2%. This disappointing retail sales figure might limit the gains for the EUR/USD pair as it counters the positive impact of the PMI data.

EUR/USD Under Pressure Amid Fed's Rate Outlook

It's important to note that the EUR/USD pair is under pressure due to concerns about the US Federal Reserve's plans for interest rates. The US Dollar Index (DXY) has pulled back from an 11-month high it hit on Tuesday, and it's currently trading around 106.90. The US Dollar got stronger because of good US job numbers and higher yields on US Treasury bonds. The 10-year US Bond yield reached its highest level since 2007, reaching 4.85% on Wednesday. This was driven by better-than-expected US JOLTS Job Openings data, which showed there were 9.61 million job openings in August, beating expectations.

Furthermore, the Fed has a more aggressive stance on keeping interest rates up for a longer time, which is boosting confidence in the US dollar. Cleveland Federal Reserve President Loretta Mester even suggested they might raise rates at the next meeting if the economy stays strong. However, Atlanta Fed President Raphael Bostic took a more patient approach, saying there's no rush to change rates. Investors are waiting for more US job data, including the ADP report on Wednesday and the Nonfarm Payrolls report on Friday.

Eurozone Economic Highlights and ECB Outlook

On the Euro side, the positive Eurozone HCOB Purchase Manufacturing Index (PMI) data could offer some support for the Euro. The report for September showed that the Composite PMI improved slightly to 47.2 from the previous 47.1, which was expected to stay the same. German Composite PMI also inched up to 46.4 from 46.2 before, and the Services PMI increased to 50.3, surpassing the expected 49.8.

Thereby, the European Central Bank (ECB) is being careful about raising interest rates. Some officials are hopeful about inflation, while others, like ECB Chief Economist Philip Lane, are cautious. These different opinions show that the Eurozone's economic situation is uncertain and could affect the Euro's strength.

EUR/USD - Technical Analysis

The EUR/USD pair has exhibited a notable trajectory in the financial market as of October 04. Currently, the currency pair is trading around the 1.0501 mark, reflecting the intricate interplay of global financial factors and currency dynamics. From a technical standpoint, several pivotal price points have emerged. The pivot point for the pair is identified at 1.0501. On the bullish side of the spectrum, immediate resistance looms at 1.0551, with subsequent resistances identified at 1.05912 and 1.06601. Conversely, for potential downward shifts, immediate support is situated at 1.04505, succeeded by supports at 1.04015 and 1.03262.

Diving into the technical indicators, the Relative Strength Index (RSI) for the EUR/USD stands at 34. An RSI below 50 suggests a bearish sentiment, and with the current value being even closer to 30, it is inching towards the oversold territory. The 50-Day Exponential Moving Average (50 EMA) is marked at 1.055. With the current price of the pair being below this level, it indicates a short-term bearish trend. The 50 EMA is also offering resistance at this mark, further solidifying the bearish perspective.

From a chart pattern perspective, the observed downward channel suggests a selling trend for the pair. This sentiment is echoed by the 50-day EMA, which also advocates for a selling trend, further establishing the resistance around the 1.055 mark.

In terms of the broader trend, the prevailing sentiment for the EUR/USD pair appears to be bearish. Over the short term, market participants might look to adopt a strategy of selling below 1.055 and considering buy positions above this level. As always, it's crucial for traders and investors to stay updated with any fundamental news that might influence market dynamics and adjust their strategies accordingly.

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Daily Price Outlook

During the European session, the GBP/USD pair extended its sideways movement for a second consecutive day. It currently hovers near its lowest level since March 16, a point it reached earlier this week. It has slipped below the 1.2100 mark, raising concerns of a potential continuation of its downtrend, which originally commenced three months ago, stemming from a peak in July.

However, the bearish sentiment is largely attributed to growing expectations that the Federal Reserve may opt to raise interest rates once again, consequently boosting US bond yields. This upward movement in yields is strengthening the US dollar, as it attracts investors seeking higher returns. Moreover, a ongoing risk-off marker sentiment further bolstering the demand for the US dollar as a safe haven asset and contributed to the GBP/USD pair losses.

Adding to the mix is the unexpected decision by the Bank of England to leave interest rates unchanged. This unexpected move continues to exert downward pressure on the British pound, further complicating the outlook for the currency pair

Factors Supporting the Strong Performance of the US Dollar

It's worth noting that the US Dollar is remained strong and stands near a 10-month high. This is because of the Federal Reserve's more aggressive stance on monetary policy, which is acting as a challenge for the GBP/USD pair. Investors believe that the Fed will keep interest rates high for a while longer. Some Fed officials have even suggested another rate hike this year to control inflation.

Furthermore, the recent jobs report showed a significant increase in job openings, hinting at possible wage increases. This might push the Fed to keep raising rates into 2024, which is good for the USD. On the other hand, the US bond market is causing some worries as borrowing costs rise rapidly. This makes investors more cautious about risky investments and favors the safe-haven US Dollar.

Factors Affecting GBP/USD Performance

Another factor that has been pushing the GBP/USD pair down is the unexpected decision by the Bank of England (BoE) to maintain its current policy stance in September. This surprising move has left investors uncertain about the future of UK monetary policy and has put downward pressure on the British Pound (GBP).

Looking forward, the market participants are awaiting the final UK Services PMI data, hoping it will provide new insights. Simultaneously, they are closely monitoring critical US economic indicators, such as the ADP report on private-sector employment and the ISM Services PMI.

GBP/USD - Technical Analysis

On October 04, the GBP/USD trading trajectory has taken an intriguing turn. Presently, this currency pair is floating around the 1.20551 pivot point, reflecting the complexities and nuances of the international currency market. The significant technical levels to monitor in the short term include immediate resistance at 1.21071, followed by 1.21398 and 1.21878. Conversely, the asset has marked its immediate support level at 1.20041, with additional cushions positioned at 1.19537 and 1.18987.

From the perspective of chart patterns, the GBP/USD's movement is showing signs reminiscent of a Fibonacci retracement. The pair appears poised to bounce off the 1.2050 region, potentially aiming for the 23.6% Fibonacci retracement level at 1.2100 or the 38.2% level at 1.2137. This suggests that the GBP/USD might undergo a short-term bullish correction.

In conclusion, despite the overarching bearish sentiment for the GBP/USD pair, there seems to be potential for a bullish correction, particularly if the price sustains above the 1.2050 level. Traders might consider initiating buy orders above this threshold and explore selling options should this level be breached. As always, it's crucial to remain vigilant of any emerging fundamental news that could recalibrate the market landscape.

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Daily Price Outlook

Gold prices (XAU/USD) have been declining for eight consecutive days, nearing a seven-month low reached on Tuesday. However, this drop is primarily driven by the Federal Reserve's (Fed) indication of a more aggressive approach to raising interest rates, reducing gold's appeal as an investment choice. Moreover, the higher U.S. Treasury bond yields and the strength of the U.S. Dollar are further diminishing gold's attractiveness.

Investors are now awaiting two critical reports, the US ADP employment report, and the ISM Services PMI, hoping to identify potential short-term trading opportunities. Gold is facing challenges due to the Fed's intentions, high bond yields, and a robust U.S. Dollar, and traders are optimistic about favorable news that could reverse this trend.

Fed Rate Hikes and Gold's Challenges

It is worth noting that many people believe the Fed will keep raising interest rates for a while, which is not suitable news for gold because it doesn't pay interest. However, this belief was reinforced by the JOLTS report, which revealed a significant number of job openings in the U.S., signaling a robust demand for workers and a competitive job market. Furthermore, the rise in wages can potentially contribute to inflation, a matter the Fed is closely monitoring.

If inflation remains high, the Fed could continue raising rates well into 2024. This has triggered a sell-off in the U.S. bond market, pushing the yield on 10-year government bonds to its highest level in 16 years and bolstering the strength of the U.S. Dollar. However, gold's price drop might slow down because it's been falling a lot recently, and there's also some nervousness in the market. Traders are keeping an eye on reports like the US ADP and ISM Services PMI for short-term trading opportunities, but the big focus is on the US NFP report coming out on Friday.

Political Turmoil and Safe-Haven Gold

Across the ocean, Republican Kevin McCarthy, who successfully led efforts to fund the government until November 17, has been removed from his role as the U.S. House speaker. This disagreement within the Republican party has created confusion in the market, especially with the 2024 elections approaching and concerns about a possible recession on the horizon. These uncertainties are making investors nervous. Thereby, people tend to seek safety in assets like gold, which was seen as one of the key factor that could limit the number of bearish bets on XAU/USD (gold price) by traders.

Looking forward, traders are closely watching the ADP report, which is anticipated to reveal the addition of approximately 153,000 private-sector jobs in September, a decline from the 177,000 added in the previous month. Furthermore, the expected drop in the ISM Service PMI from 54.5 to 53.6 in September could also influence XAU/USD trading.

GOLD(XAU/USD) - Technical Analysis

Today, Gold (XAU/USD) is trading around the $1,830 mark per troy ounce, echoing the tremors and shifts of the global economic dynamics. Over the past 24 hours, several pivotal price thresholds have been identified. These include a pivot point set at $1,830, immediate resistance at $1,842, followed by subsequent resistances at $1,868 and $1,880. On the flip side, Gold finds its immediate support at $1,816, with further cushions at $1,797 and $1,786.

From a technical standpoint, the Relative Strength Index (RSI) for Gold stands at 20, signaling an oversold condition. Traditionally, an RSI reading below 30 is seen as an oversold marker, hinting at a possible price bounce or reversal in the near future. Furthermore, Gold's price positioning relative to the 50-Day Exponential Moving Average (50 EMA) — currently pegged at $1,865 — indicates a short-term bearish sentiment. However, should Gold breach this EMA, it could signal an incoming bullish wave.

Chart patterns also offer insightful cues. The current RSI, indicating oversold conditions, suggests a potential bullish reversal on the horizon. Moreover, the robust support zone anchored at $1,816 could serve as a magnet for potential buying, suggesting a bullish trend in the making. This implies that if Gold manages to sustain its stance above this crucial support realm, we might witness a surge in bullish momentum. However, a breach below this level could beckon sellers to the fore.

In wrapping up, the current trajectory for Gold leans towards a cautiously optimistic stance. The precious metal might embrace a bullish trend if it manages to hover above the $1,816 benchmark. Yet, any descent below this juncture could tilt the scales bearish. In the short term, given the constellation of technical indicators and the dance of support-resistance, Gold might aim to touch the resistance echelons of $1,842, or potentially even $1,868, in the upcoming trading sessions.

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Daily Price Outlook

During the early European session on Tuesday, the AUD/USD currency pair continued its bearish trend, failing to find support as it remained firmly below the mid-0.6300s. It is trading at 0.6313, showing a marginal 0.78% loss for the day. However, the decline in its value can be attributed to the Federal Reserve's adoption of a more hawkish stance, the upward trajectory of US bond yields, and the persistent strength of the US dollar.

Furthermore, the market participants seems cautious to place any strong position as they await the Reserve Bank of Australia (RBA) to reveal its monetary policy decisions.

US Manufacturing Data and Federal Reserve Comments Impacting AUD/USD

It's important to mention that the US ISM Manufacturing PMI for September came in at 49.0, up from the previous reading of 47.6. This was slightly higher than the expected 47.7 but still indicates that the US manufacturing sector is shrinking. In more detail, the Prices Paid Index dropped from 48.4 to 43.8, showing a decrease in prices paid by manufacturers.

On the positive side, the Employment Index increased from 48.4 to 51.2, indicating some improvement in job prospects. Furthermore, the New Orders Index went up from 46.8 to 49.2, suggesting a slight increase in new orders.

On another note, Federal Reserve Governor Michelle Bowman mentioned that it is likely they'll raise interest rates and keep them high for a while. On the other hand, Fed Vice Chair for Supervision Michael Barr has taken a more cautious stance, emphasizing the importance of how long interest rates will remain high. Barr believes that they can control rising prices without negatively impacting job opportunities.

Therefore, the AUD/USD currency pair may face some additional pressure as the stronger US data and hints of higher interest rates could boost the US dollar's attractiveness relative to the Australian dollar.

Economic Outlook and Key Events in Australia and the US

In Australia, the Reserve Bank is expected to keep interest rates steady at 4.1% during Michele Bullock's first meeting as governor. Market watchers will pay close attention to the RBA's statement, especially for any hints about potential future rate hikes, which could help support the Australian dollar against the US dollar.

Looking ahead, traders will be closely monitoring the RBA's interest rate decision on Tuesday. In the US, the focus will shift to employment data, with the ADP report coming on Wednesday and Nonfarm Payrolls on Friday. These reports can influence the currency market dynamics.

AUD/USD - Technical Analysis

The AUD/USD pair decisively penetrated the 0.6400 mark, approaching the anticipated initial bearish target of 0.6330. Market projections suggest further downward momentum, with subsequent targets at 0.6270 and then 0.6200.

In the foreseeable future, the bearish outlook is poised to prevail, underscored by its position beneath the EMA50. It's pivotal to note that any sustained breach above 0.6400 could halt this decline, ushering in potential recovery efforts. For today's trading landscape, the AUD/USD is projected to fluctuate between a support level of 0.6280 and a resistance point of 0.6380.

Daily Price Outlook

Gold, represented as XAU/USD, has been on the downward trend for seven consecutive days, hitting its lowest point in almost seven months. However, this bearish trend is mainly attributed to the Federal Reserve's hawkish outlook, surging US bond yields, and the robust performance of the US dollar. It is worth noting that the Federal Reserve has warned about ongoing inflation, signaling the possibility of at least one more interest rate hike in 2023. Hence, their reaffirmation of the "higher-for-longer" stance has added to market concerns, intensifying the downward pressure on gold's value.

Furthermore, the robust macroeconomic data from the United States strengthens expectations of additional tightening measures by the Federal Reserve. In the meantime, the sustains higher US Treasury bond yields and propels the US Dollar to its highest point since November 2022, diverting investment flows away from the non-yielding gold.

In contrast to this, the mild weaker mood in the stock markets provided some backing for the safe-haven gold, helping to limit losses as per the daily chart, which showed extremely oversold conditions. Nevertheless, the overall situation implies that the XAU/USD pair is more likely to head lower, and any significant recovery could be viewed as a chance for bearish traders to enter the market.

Gold Prices Decline Amidst Rate Hike Expectations

It's worth noting that gold prices are currently on their longest losing streak since August 2022 due to growing expectations of more interest rate hikes by the Federal Reserve. Fed officials, including Governor Michelle Bowman and Vice Chair Michael Barr, emphasize the need for continued restrictive monetary policy to control inflation.

Cleveland Fed President Loretta Mester also highlights the risk of higher inflation and the necessity of raising rates. Additionally, strong economic indicators, such as the US ISM Manufacturing PMI and rising consumer spending, indicate a likelihood of further policy tightening. As a result, the US Dollar is consolidating its gains, undermining the gold prices.

Looking forward, traders will pay close attention to the RBA interest rate decision on Tuesday and the US JOLTS Job Openings report later in the day. Later in the week, the focus will shift to US employment data, with the ADP report coming out on Wednesday and the Nonfarm Payrolls on Friday.

GOLD(XAU/USD) - Technical Analysis

The gold price continues its downward momentum, approaching the anticipated extended target of $1809.35. Market analysts foresee this bearish trend surpassing this benchmark, potentially advancing towards the $1765.20 mark.

Given the prevailing circumstances, the bearish outlook is poised to dominate the near-term landscape, underscored by the downward influence of the EMA50. It's imperative to highlight that any breakthrough above $1838.35 could disrupt this declining trend, ushering in potential intraday recovery efforts. For today's trading, the gold price is projected to oscillate between a support level of $1795.00 and a resistance point of $1830.00.

Daily Price Outlook

During the early European trading session, the USD/CAD pair continued its upward momentum, marking the third consecutive day of gains. It surged to its highest level since late March, driven by several key factors. Firstly, the Canadian dollar, often referred to as the Loonie, faced increasing pressure due to the declining oil prices, which pushed the USD/CAD pair higher. Another factor boosted the currency pair is the Federal Reserve's adoption of a more hawkish stance, which underpinned the US dollar and contributed to the USD/CAD pair gains.

Strength of the US Dollar and Its Impact on USD/CAD

The US dollar has been getting stronger lately, reaching a 10-month high. This is mainly because people believe that the Federal Reserve (Fed) will continue to be strict with its monetary policy. The US is also seeing strong economic data, which supports this belief. Cleveland Fed President Loretta Mester's comments have added to this, suggesting that the Fed will keep interest rates high for a while. As a result, the yields on the 10-year US government bonds are at their highest in 16 years. Additionally, with the market feeling cautious, investors are choosing the safe US dollar, which is helping the USD/CAD pair go up.

Challenges for the Canadian Dollar (CAD)

The Canadian Dollar (CAD) is facing challenges as people believe the Bank of Canada (BoC) won't raise interest rates anymore. This belief grew stronger when Canada's economy didn't grow in July, with manufacturing seeing its biggest drop in over two years. In June, the economy even shrank by 0.2%. This suggests the BoC might keep interest rates steady despite rising prices. In the meantime, the falling oil prices for four consecutive days are undermining the CAD and contributing the USD/CAD gains.

USD/CAD - Technical Analysis

The USD/CAD pair exhibited notable strength in its previous session, successfully exceeding our initial target of 1.3585 and advancing to our secondary objective at 1.3680. The currency pair has begun today's trading with a further ascent, breaking past this level, thereby reinforcing its dominant bullish trajectory for both intraday and short-term perspectives, paving the way towards a potential target of 1.3805.

Given the current dynamics, the bullish outlook remains robust and is further endorsed by the EMA50. However, it's crucial to mention that if the pair fails to maintain its position above 1.3680, it could reverse into a bearish correction.

Today, the anticipated trading bracket for USD/CAD is delineated between a support level of 1.3640 and a resistance threshold of 1.3780.

Daily Price Outlook

Gold (XAU/USD) price failed to stop its downward trend and dropped significantly at the end of September, decreasing by more than 4.5%. This marks the second consecutive quarterly decline, and it was also the largest weekly drop in over two years. However, the main reason behind this decline is the growing belief that the Federal Reserve will keep interest rates higher for a longer period. Fed's indicated that it may raise interest rates one more time by the end of the year. This move makes other investments more attractive than gold because gold doesn't provide any interest or yield. As a result, investors are moving their money away from gold, causing its price to fall.

Gold's Brief Friday Boost Fades Quickly Amid Fed Expectations

It's worth noting that gold prices received a modest boost last Friday, thanks to some economic data, specifically the PCE Price Index, coming out of the United States. However, this uptick was short-lived, primarily because this data failed to alter the prevailing belief that the Federal Reserve (Fed) would persist in implementing a more stringent monetary policy. Consequently, US Treasury bond yields went up again on Monday, which posed a challenge for gold since it doesn't yield any interest. Thereby, gold witnessed its sixth consecutive day of decline, plummeting to its lowest value since March 10th.

Gold Prices Decline Due to Increased Risk Appetite

In addition to the Fed's anticipated stringent approach, another key factor contributing to the decline in gold prices is the growing confidence among investors to adopt riskier investment options, often referred to as a "risk-on" sentiment. This shift in sentiment was spurred by some favorable economic data emerging from China, surpassing expectations, coupled with the passing of a temporary funding bill by the US government over the weekend. These developments have led investors toward riskier assets, diverting their attention away from safe-haven choices like gold.

Nonetheless, a couple of factors are acting as a cushion to prevent gold from experiencing a significant drop. Firstly, the US Dollar witnessed a slight dip, making gold relatively more attractive. Secondly, the Relative Strength Index (RSI) on the daily chart has indicated that gold was oversold, signaling that it might not be an opportune moment for bearish traders to make substantial bets against gold. These factors collectively work to ease the downward pressure on gold prices.

Looking forward, investors will keep their eyes on a potentially eventful week. It begins with the US ISM Manufacturing PMI release on Monday, but the real highlight is the US NFP report due on Friday. In simpler terms, these key figures could exert a significant influence on the trajectory of gold prices.

GOLD(XAU/USD) - Technical Analysis

On a 4-hour chart timeframe, Gold currently navigates crucial price levels with a pivot point set at $1,874. Looking at the immediate resistances, the first is situated at $1902, followed by higher resistances at $1955 and $2035. Conversely, for support levels, an immediate support is observed at $1820 with subsequent supports placed at $1793 and the more distant one at $1712.

The technical indicators shed further light on the asset's current stance. The Relative Strength Index (RSI) presents a value of 18. Such a low RSI suggests the asset is in an oversold condition, typically interpreted as a bearish sentiment. However, caution must be exercised as oversold conditions can occasionally precede a price rebound.

Another significant technical pointer is the 50-Day Exponential Moving Average (EMA). With a current value standing at $1889 and the price of Gold trading below this, it hints at a short-term bearish trend for the asset.

Turning to chart patterns, Gold's chart reveals the formation of Lower Lows. Additionally, the presence of the Three Black Crows candlestick pattern emphasizes a strong selling bias. Historically, these patterns are strong bearish indicators, suggesting that there might be further declines in the near term.

No fundamental news has been provided as part of this outlook. In conclusion, Gold's trend appears bearish, especially if it sustains below the $1858 mark. However, if it manages to breach this level, the outlook might tilt towards the bullish side. For the short term, given the prevailing bearish indications, it wouldn't be surprising to see Gold test the immediate support level at $1820 in the coming days. 

Daily Price Outlook

During the early European session, the EUR/USD pair struggled to make significant gains and mostly hovered around the mid-1.0500s. However, the reason behind this was the growing belief that the Federal Reserve (Fed) might tighten its policies further, causing US Treasury bond yields to rise.

This, in turn, strengthened the US Dollar (USD) and weighed on the EUR/USD pair. Moreover, the possibility of the European Central Bank (ECB) postponing any additional interest rate hikes also weighed on the pair. On the flip side, a general risk-on sentiment in the market limited the demand for the safe-haven US Dollar, providing some support to the EUR/USD pair.

Market Sentiment Boosts EUR/USD, but ECB Rate Cut Speculations Linger

The global market sentiment is rising thanks to better-than-expected Chinese PMI data and the US government passing a temporary funding bill. This positive mood is keeping the US Dollar (USD) from surging and is giving some support to the EUR/USD pair. Conversely, many people think the European Central Bank (ECB) might cut interest rates in the future, keeping the Euro lower.

Recent data suggests that high inflation in the Eurozone might be slowing down, and there's even speculation about the Eurozone economy shrinking in the coming months. This has led to doubts about further ECB rate hikes, especially after the latest consumer inflation figures dropped from 5.3% to 4.5% in September.

US Dollar Strength Amid Fed's Tightening and Upcoming Data

The broad-based US dollar is generally strong because most believe the Federal Reserve (Fed) will keep tightening its policies. This makes the EUR/USD pair struggle to go up. The US PCE Price Index, a measure of inflation, increased as expected, showing a 3.5% rise in the past year through August.

However, the Core PCE Price Index, which the Fed prefers, eased slightly to 3.9% in August. Despite this, higher consumer spending and rising gas prices indicate that inflation will remain a concern. This means the Fed will likely stick to its tough stance, keeping interest rates high, which supports the US dollar and higher bond yields.

Looking ahead, traders seem cautious to place any strong bids as they are waiting for crucial US economic data coming at the start of the month. The week starts with the US ISM Manufacturing PMI release and a speech by Fed Chair Jerome Powell. These events will affect the US dollar's value and provide direction for the EUR/USD pair later in the North American session.

EUR/USD - Technical Analysis

The EUR/USD forex pair displays intriguing movements around the 1.0600 level, hinting at a mild bearish tilt. Yet, the stochastic indicator's positive momentum suggests possible bullish activity, targeting the 1.0675 region. However, any decline below 1.0550 could curb bullish prospects. Today's trading might range between 1.0520 support and 1.0660 resistance.

Technically, the 4-hour chart's pivot point is 1.0572, with resistances at 1.0658, 1.0739, and 1.0907; supports lie at 1.0488, 1.0405, and 1.0238. The RSI, at 45, shows neutrality leaning bearish.

The 50-Day EMA stands around 1.06082, potentially indicating the market's short-term trend. A notable downward trendline presents resistance at 1.0600; breaching this could change momentum. In summary, EUR/USD's short-term trajectory hinges on the 1.0600 mark, with a potential move towards the 1.0658 resistance if bullish momentum continues.