Gold (XAU)
Key news events today
CPI (12:30 pm GMT)
What can we expect from Gold today?
US CPI data is one of the most anticipated economic events of the week. With headline CPI rising to 3.2% YoY in July from 3.0% YoY from the previous month and the forecast for August pointing to another increase to 3.6% YoY, inflationary pressures appear to be returning to the forefront. This would cause the Federal Reserve to maintain its hawkish monetary policy stance and perhaps even increase interest rates once more at next week’s FOMC meeting. A hotter than expected CPI reading is more than likely to function as a bullish catalyst for the DXY and thus drive gold prices lower.
Next 24 Hours Bias
Weak Bearish
Technical
The XAU/USD (Gold/US Dollar) chart currently exhibits a bearish overall momentum, signaling a potential downward trend in price movement. There’s a likelihood of a bearish continuation towards the 1st support level.
The 1st support at 1901.14 is considered a strong support zone, as it aligns with an overlap support, the 78.60% Fibonacci Retracement, and the 78.60% Fibonacci Projection, indicating Fibonacci confluence. Additionally, the 2nd support at 1889.19 is characterized as a multi-swing low support.
On the resistance side, the 1st resistance at 1913.49 represents an overlap resistance, while the 2nd resistance at 1931.97 is also marked as an overlap resistance.
Oil
Key news events today
EIA Crude Oil Inventories (2:30 pm GMT)
What can we expect from Oil today?
The latest OPEC monthly report highlights a shortfall of 3 million barrels of crude per day in the fourth quarter of 2023 as Saudi Arabia and Russia both extend their voluntary production cuts. Global oil markets potentially face the biggest supply deficit in more than a decade and with demand remaining strong, crude prices have surged since mid-July.
Meanwhile, API crude oil stocks increased by 1.2M barrels versus an estimate of a 2M drawdown. This surprise increase in stockpiles was not enough to hold back crude prices as WTI oil rose from $88.00 to touch $88.50 following this news release.
Next 24 Hours Bias
Weak Bullish
Techncial
The WTI chart currently indicates a weak bearish momentum with low confidence as the RSI is displaying a bearish divergence versus the price, suggesting the possibility of a reversal in the near future. There is a potential scenario where price could experience a bearish reaction close to or upon reaching the 1st resistance level and subsequently drop towards the 1st support level.
The 1st resistance level at 88.77 is identified as an overlap resistance that coincides with the 161.80% Fibonacci extension level. Furthermore, the 2nd resistance level at 91.03 is noted as a resistance level that aligns with the 78.60% Fibonacci projection level.
To the downside, the intermediate support level at 87.30 is marked as pullback support while the 1st support level at 85.59 is identified as an overlap support that aligns with the 23.60% Fibonacci retracement level. Additionally, the 2nd support level at 84.30 is marked as a pullback support.
