The Daily Brief: Your Economic Rundown

Market Overview

The Iron Dome Failed？

After the latest attacks on Israeli soil by Iran, many missiles hit their target. While the damage was minimal, it showed that Israel's defenses can be breached.

How did this happen？ It was due to the intensity of the attack. The U.S. government stated that this attack was twice as large as last April's. Unlike last time, which involved mostly rockets and drones, this attack used 180 ballistic missiles.

Notably, there were no warnings for this attack, unlike the one in April, when Iran was more vocal.

Now, let‘s shift focus to the economy. Can Israel fend off these attacks while maintaining its economic health？ Sustaining defense systems will be a challenge. For example, one Arrow Interceptor costs $3.5 million, and one David’s Sling costs $1 million. These are just a few of the many defense systems Israel may use.

On the other hand, Irans ballistic missiles cost only around $100,000 each. Over time, with a sustained barrage, Iran may hold the upper hand. They reportedly have 3,000 more ballistic missiles, and the latest attack was only a fraction of their arsenal.

Israel has one significant advantage: its relationship with Washington. While Israel's economy alone may struggle to sustain its defense, its ally, the U.S., will likely help replenish supplies. The question is, for how long can this continue？

Netanyahu made a statement saying that Iran made a big mistake and he seeks revenge.

Conclusion？ They are now formally at war, and world powers are choosing sides.

Market Analysis

GOLD - GOLD is flat in recent trading, with traders split on how the market will react to the recent escalations in West Asia and the upcoming November rate cuts. However, will the rate cut even happen？ Perhaps this will be the last one. After all, inflation is delayed, and we wont feel its effects until later. In other words, a couple of months from now, we may see another wave of rate hikes to counter oil inflation.

SILVER - SILVER has broken through support, indicating the possibility of further decline. However, I hesitate to confirm this. While structurally it suggests a continued fall, the double bottom with a range floor implies it‘s still possible for SILVER to increase from here. We need more confirmation to see where we’re headed.

DXY - The dollar found strength after the likelihood of a 50-basis-point rate cut dropped to 0%. However, the 25-basis-point cut is still on the table. Until the world feels the impact of oil inflation, expected in a few months, the dollar will have a weaker outlook.

GBPUSD - The pound is already on the losing side, but their hesitation to cut rates could prove beneficial in the future. We will see how the market progresses and the potential rise alongside the upcoming November rate cut.

AUDUSD - The Australian dollar is currently falling, dropping below 0.67531 and moving toward 0.67142. We expect the market to drop further, as anticipated, due to the market's sensitivity to global security risks.

NZDUSD - The Kiwi is set to drop soon, reflecting its loss after tomorrows rate cut decision. A supersized cut is expected for the Kiwi, leading to a decline. This structure supports further selling.

EURUSD - The Euro remains consolidated with no clear direction. However, amid the intensifying war, the Euro is expected to weaken. We await further price action to confirm movement but anticipate more selling.

USDJPY - The Yen is gaining strength, recovering from the significant losses of last week. We expect further selling to enter the market.

USDCHF - The Franc has gained strength, returning to the range below 0.85541. We expect this market to continue ranging as global insecurity worsens.

USDCAD - Loonie strength has yet to materialize, but current structures suggest further buying, followed by a significant fall. We await further confirmation, but anticipate the market rising in the near term. Stronger CAD performance is yet to come.