1. Forex Market Insight
This week, the Federal Reserve will announce its latest interest rate resolution. However, the economic expectations and dot plot will not be announced.
Nevertheless, Fed Chairman Jerome Powell will hold a press conference, as the market is widely expecting the Fed to announce the decision to taper its bond purchases at its November meeting. Bearing this, the euro will trigger dramatic fluctuations.
(EUR/USD 1-hour chart)
Today, pay attention to the 1.1622-line. If the euro runs steadily below the 1.1622-line, maintain the bearish trend. With this, pay attention to the support at 1.1535 and 1.1501 in turn. If the strength of the euro breaks through the 1.1622-line, then pay attention to the repressive strength at 1.1663 and 1.1708.
GBP Intraday Trend Analysis
The Bank of England rate hike is expected to heat up to support the pound. Many recent analyses have pointed out that the U.K. interest rate hike is inevitable and predict that the Monetary Policy Committee (MPC) will raise rates by 15 basis points in December this year, which is the best compromise outcome.
Barclays Bank stated in its recent forward-looking report that if the structural problems in the U.K. are to be solved, the Bank of England Monetary Policy Committee (MPC) will raise interest rates by 15 basis points in December, followed by 25 basis points each in February and May next year.
Bank of England Governor Andrew Bailey has also hinted more than this rate hike, recently he also released a clearer “turn hawk” signal. In addition, he said that the current U.K. inflation rate is higher than the central bank set 2% target, and must be managed to slow inflation.
Against the backdrop of an unexpected rise in inflation but weakening growth momentum, the hawkish members of the MPC made a more convincing case than the doves. The money market prices will remain close to 100 basis points between now and mid-2022, compared to just 15 basis points before the MPC meeting in August.
While supply chain disruptions and rising energy prices are a global phenomenon, the MPC highlighted the risk of continued inflationary pressures, the risk of excessive expectations, and the risk of wage disruptions.
(GBP/USD 1-hour chart)
The pound today is mainly focused on the direction of the breakout of the 1.3669 to 1.3712 range. If it falls below the 1.3669-line, it will open up further downside. At that time, pay attention to the support at the 1.3574 and 1.3522 positions. If it breaks through the 1.3712-line, it will open up a further upside potential. At that time, pay attention to the suppression of 1.3761 and 1.3801 positions.
2. Precious Metals Market Insight
Gold prices are currently trading near $1780, as the market’s expectation for the Fed’s resolution this week to taper debt and rising interest rates next year continue to increase, which put heavy pressure on gold prices.
However, due to the slow growth of the U.S. economy, the labor market is still facing serious problems. This led to the rise of stagflation concerns, which limited the decline in gold prices before the Fed’s resolution.
This week’s focus on the Fed’s November interest rate resolution. The Fed’s meeting will not announce economic expectations and dot plot, but Powell will be holding a press conference.
With this, global commodity trends are likely to be affected by the resolution, but investors must remain highly vigilant.
(Gold 1-hour chart)
Today, gold pays attention to the first line of 1782. If the price of gold runs steadily above the first line of 1782, then pay attention to the suppression on the first line of 1800. If the price of gold falls below the first line of 1782, it will open up a further downside space. At that time, pay attention to the support of the two positions at 1768 and 1760.
3. Commodities Market Insight
WTI Crude Oil
Oil prices rose by 11% in October on signs that consumption outpaced supply and led to a decline in inventories. The continued shortage of natural gas boosted demand for oil products, which also helped push oil prices higher in October. Adding to this, the OPEC+ meeting this week may shape the direction of oil prices.
(Crude oil 1-hour chart)
Today, oil prices are focused on the direction of the 80 to 82.83 range. If it breaks above the 82.83-line and upwards, it will open up a further upside potential. At that time, it will possibly test the suppression of the 85-line again. If it falls below the 80-line, it will open a further downward space. At that time, pay attention to the strength of support at 76.89 and 75.04.
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