Article by: ETO Markets
As the trading day progresses, market participants will have their eyes fixed on the U.S. Jobless Claims and the Philly Fed index, which are key indicators for the health of the American economy. Furthermore, Federal Reserve Chair Powell is scheduled to deliver a speech, making his insights and remarks of particular interest to traders and investors. These events promise to influence forex markets and set the tone for the week's price forecasts.
With a mix of Asian and U.S. economic data and the Federal Reserve Chair's perspective, this week's forex outlook is poised for dynamic price movements, making it essential for forex traders to remain alert and adjust their strategies accordingly.
Powell's dovish remarks on Thursday further strengthened gold, reaching its highest point in nearly three months, and rose to $1,982 during Asian early trading on October 20th. Federal Reserve Chairman Powell stated that there would be no further interest rate hikes, combined with geopolitical tensions in the Middle East, resulting in a significant influx of safe-haven funds, supporting gold prices. However, Thursday's U.S. employment data indicated continued strength in the U.S. economy. Although Powell expressed a desire to pause rate hikes, the active labor market could still lead to further monetary policy tightening.
For the technical outlook of XAU/USD, the extreme fluctuations in the gold market first saw a drop of nearly $… within two weeks, followed by a subsequent increase of $… over the next two weeks. Currently, the gold price faces strong resistance at $…, and from the RSI perspective, gold is already overbought. The previous resistance level of $… has now transformed into a new support level. If this level cannot be breached, it will be challenging to reverse the upward trend in gold. Additionally, the high point reached on July 20th at $… has posed a certain obstacle to the gold price's ascent. If this level is broken, gold is likely to rise to $… and eventually attempt to break the high point of May 4th at $…
WTI oil prices declined to around $86.80 per barrel in the Asian session due to potential US-Venezuela deals that could boost global crude oil production. The United States is considering exemptions on Venezuelan oil exports, expected to increase production in the OPEC nation and divert barrels from China.
The US President's office is reportedly planning to relax energy-related sanctions for Venezuela's oil and gas sector. The American Petroleum Institute reported a significant drop in API Weekly Crude Oil Stock, down to 4.383M from the previous 12.94M.
In the midst of these developments, OPEC shows no support for Iran's proposal to impose an oil embargo on Israel. The conflict in the Gaza Strip intensifies following a hospital explosion, resulting in over 500 civilian deaths, with accusations exchanged between Israel and Hamas...
