Tag: chart analysis

U.S. Dollar To Hit $121; Crude Oil To Hit $176?

Posted on by Aibek Burabayev

It turned out that the dollar weakness we observed in February was about to be over right after the earlier update. I thought we would see more downside for the DX in the area between 94.4 and 92.5 (Fibonacci retracement levels) before the rally resumes, and most readers supported that idea. However, the rally started immediately.

The inflationary pressure underpins the dollar, as the Fed has turned strongly hawkish on the interest rate and tapering. Let us check out the updated daily chart below.

Dollar

In my previous post, we saw the DX piercing down the dotted gray uptrend. Those punctures turned out to be false breaks, as fallouts of the channel were temporary, and the move up resumed overcoming above the preset confirmation level of 97.4. Continue reading "U.S. Dollar To Hit $121; Crude Oil To Hit $176?" →

Gold Rises Ahead Of CPI Inflation Report

Posted on by The INO.com Team

As of 4:44 PM EDT gold futures basis, the most active June 2022 contract is trading up $11.70, a gain of 0.60% at $1949.50. There were some alarming forecasts for the upcoming release of the latest inflationary data vis-à-vis the CPI (Consumer Price Index) on Tuesday, March 12. Just last week, estimates were released by the Federal Reserve Bank of Cleveland, which revealed a detailed estimate of the upcoming CPI report indicating that the level of inflation in March could run as high as 8.41%. Furthermore, estimates for the first quarter of 2022 predict inflationary pressures quarter over quarter could swell as high as 9.1%.

inflation

The chart above is a 240-minute candlestick chart of gold futures. We have included trendlines highlighting a series of lower highs as well as a series of higher lows. This has created a compression triangle and breakout above the current resistance level. This indicates that gold has concluded its consolidation period and moved back into a solid rally mode. This puts our next target for potential resistance at $1967.60. Above that price point, there is resistance at $2000 and major resistance at $2016. Continue reading "Gold Rises Ahead Of CPI Inflation Report" →

Jobs Report Supports Aggressive Rate Hikes

Posted on by The INO.com Team

The most recent jobs report supports aggressive Fed rate hikes, to reduce inflation, but other factors need to be resolved to solve the big global picture.

The Bureau of Labor Statistics released some welcome news today. 431,000 Americans became gainfully employed in March, and the jobless rate was within 0.1% of 3.5%, coming in at 3.6%. Economists polled had forecasted that over 500,000 jobs would be added. However, that has little relevance with today’s report indicating that the labor market in the United States is vibrant and strong. The strength of today’s report shows that America’s workforce is now only 1.6 million jobs, or 1% of the levels that existed before the pandemic. It must be noted that higher employment is a byproduct of a tight labor market that has had to offer higher wages to attract new workers.

This solid report will give the Federal Reserve the necessary data to continue to raise rates, most likely at a much more aggressive rate. However, the Federal Reserve will have a near-impossible mission to have a soft landing as they reduce the current inflation rate to an acceptable target rate which has been 2%. Continue reading "Jobs Report Supports Aggressive Rate Hikes" →

The War In Ukraine Will Raise Global Inflation

Posted on by The INO.com Team

Why would the war in Ukraine greatly raise the global inflation rate?

This question is extremely applicable to the current conflict because it will exponentially magnify the record high level of inflation, which began years ago as the Federal Reserve and central banks embarked on one of the most accommodative monetary policies ever. Continue reading "The War In Ukraine Will Raise Global Inflation" →

Feds Hawkish Demeanor Puts Pressure On Gold

Posted on by The INO.com Team

This week's market participants seemed complacent in regards to the Russian invasion of Ukraine and the current level of inflation. Four of the five trading days this week were characterized as having lower closes than its opening price and lower closes compared to the prior day's closing price.

On Wednesday, when the Federal Reserve concluded its FOMC meeting, gold hit its lowest value with the April futures contract trading to a low of $1895. Although gold recovered from its low, its closing price was the lowest value of closes this week. Thursday was the only day in which gold closed above its open and above the prior day's closing price. Continue reading "Feds Hawkish Demeanor Puts Pressure On Gold" →