Today's Market Insights

Market Overview

After last week's core PCE was released, data showed weaker than last month's 0.3% growth, and it is also lesser than expected. The results further eased the possibility of hawkish statements coming into the field, freeing the burden on some markets as the data suggested to some that the plans for the FED rate cuts would still come later this year. This caused a drop in the yields and the dollar and a rally in the equities market. However, the rebound on the equities was not enough to save the market from recording a drop in an overall weekly counting. 

The Dow Jones Industrial Average closed at 38,686.32 on Friday versus 39,069.59 a week ago. The tech-heavy Nasdaq Composite closed at 16,735.01 versus 16,920.79 a week prior, and the S&P 500 ended at 5277.51, compared with 5,304.72 a week earlier.

The fall in the yields allowed a huge number of investors to sell bonds due to the pull caused by hawkish statements made earlier during the week before the PCE release. This made it difficult for the metals markets in the early run, but GOLD still recorded its 4th straight monthly gain. 

However, the results are not as appreciated by other analysts. Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut said the data didn't change much in terms of interest-rate expectations.

“The core PCE this morning didn't really do anything ... It was just a status quo type of report so there is no indication that the Federal Reserve is going to be on hold longer, or going to cut rates sooner.”

U.S. crude settled down 1.18% at $76.99 a barrel and Brent settled at $81.62, down 0.29% on the day.

Some major news is also in line to report in the coming week with Monday opening with Final and ISM Manufacturing PMI in some countries, including the US.

GOLD - While GOLD has fallen below the key structure at 2332.174, bullish structures in the 4h chart are still holding up. However, there is a possibility that the GOLD can create a lower leg from here toward 2295.536. COT reports are also showing a slowdown for the bulls. Thus, we may expect a near-term sell-off. 

SILVER -The Silver is showing a possible M formation about to be completed and confirmed. There is a possibility that the price can go lower than 29.900 and toward 29.018.

DXY - The dollar has fallen after failing to go beyond 105.071. While the market is showing higher highs and lows, the market is also being squeezed. With the outlook looking positively on a dovish sentiment, we expect the price to go lower. However, the markets are sensitive to data release and changes will be made as the price goes along.

GBPUSD - GBP is strong in the COT reports while the price is respecting bullish structures. We see the market bullish and we expect the price to go beyond 1.27938.

AUDUSD -The structure in this market is very bullish. We can see the price is held up by 0.65869. We expect the price to go beyond 0.67142.

NZDUSD -NZD structure is looking very bullish and is seemingly in the position to continue moving upward. However, there is a possibility for price to stay consolidated. Currently, the price is testing 0.61408.

EURUSD - The EUR market is looking bullish and is being rejected by the trendline. The price has also settled comfortably above the structure however, there is a chance for the price to return to a downtrend.

USDJPY - The YEN is losing out against the dollar despite the DXY drop. This is also further proven by the COT reports showing more sellers entering for the Yen. We can see clear Yen weakness and expect the price to tick higher.

USDCHF - The structure is now bearish and is testing 0.90054. The price may drop lower and we can see the momentum and volume for bears coming in strongly.

USDCAD - The market is currently consolidating but we expect the price to move lower as the bearish structure is respected. However, there is still a possibility for the price to be held up at 1.36052.

COT Reports Analysis

CAD - Weak (4/5)

CHF - Weak (5/5)

GBP - Strong (5/5)

JPY - Weak (5/5)

EUR - Strong (5/5)

AUD - Weak (2/5)

NZD - Strong (3/5)

USD - Strong (3/5)

GOLD - Strong (4/5)

SILVER- Strong (4/5)