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Gold prices dwindle following US PCE data
399197 June 29, 2024 03:51 FXStreet Market News
- Gold falls from daily highs, pressured by elevated US Treasury yields.
- May US PCE Index meets forecasts, fuels hope for 2024 Fed rate cuts.
- US 10-year yield hits 4.339%, a high since June 12; DXY at 105.80, down 0.08%.
Gold prices retreated during FridayÂ’s session after an inflation report revealed progress in the disinflationary process and raised hopes that the Federal Reserve (Fed) would cut interest rates in 2024. Even though the golden metal jumped and hit a four-day high of $2,339, it retreated somewhat, with XAU/USD trading at $2,324, down 0.12%.
Bullion prices seesawed after the announcement of the US Personal Consumption Expenditures (PCE) Price Index report for May, which was aligned with estimates and painted an optimistic outlook for American consumers hit by higher prices.
Initially, XAU/USD climbed to a four-day high, but as traders digested the data, US Treasury yields climbed and Gold dropped.
The yield in the US 10-year Treasury note is advancing by five and a half basis points, up to 4.339%, the highest level since June 12. Despite this, the Greenback has failed to follow suit yet recovered from reaching daily lows, with the US Dollar Index (DXY) hovering at around 105.80, down 0.08%.
Other data showed that American consumer sentiment improved slightly compared to JuneÂ’s preliminary reading, which trailed MayÂ’s report.
Some Fed officials crossed the newswires, adopting a cautious approach. Richmond’s Fed President Thomas Barkin didn’t provide any hints regarding cutting interest rates, yet commented that monetary policy shows signs of “lagging,” implying the economy eventually will slow down.
His colleague, San FranciscoÂ’s Mary Daly, stated that inflation is cooling, that monetary policy is working, and that inflation is expected to hit the FedÂ’s target by the end of 2025.
Daily digest market movers: Gold price advances, capitalizing on soft US Dollar
- US PCE for May was lower than AprilÂ’s by 0.3%, coming in at 0% MoM, as expected. Core PCE increased by 0.1% MoM, matching estimates but below the previous reading of 0.3%.
- Fnal reading of US Consumer Sentiment for June was 68.2, down from MayÂ’s 69.1 but an improvement over the preliminary reading of 65.8. Inflation expectations remained steady at 3% for both the short and long term.
- According to CME FedWatch Tool, odds for 25-basis-point Fed rate cut in September are at 69%, up from 64% before US PCE release.
- December 2024 fed funds rate futures contract implies Fed will ease policy by just 35 basis points (bps) toward the end of the year.
Technical analysis: Gold price slumps after testing Head-and-Shoulders neckline
Gold remains on the defensive after a Head-and-Shoulders chart pattern emerges, which hints bullion might edge lower. Momentum shows that neither buyers nor sellers are in control, but the Relative Strength Index (RSI) remains tilted bearish.
If XAU/USD drops below $2,300, the next stop would be the May 3 low of $2,277, followed by the March 21 high of $2,222. Further losses lie underneath, with sellers eyeing the Head-and-Shoulders chart pattern objective from $2,170 to $2,160.
Conversely, if Gold reclaims $2,350, that will expose additional key resistance levels like the June 7 cycle high of $2,387, ahead of challenging the $2,400 figure.
Gold FAQs
Gold has played a key role in humanÂ’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesnÂ’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a countryÂ’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
United States CFTC S&P 500 NC Net Positions increased to $-65.2K from previous $-114.1K
399196 June 29, 2024 03:51 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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Australia CFTC AUD NC Net Positions: $-23.7K vs $-41.7K
399195 June 29, 2024 03:49 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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Eurozone CFTC EUR NC Net Positions down to €-8.4K from previous €8K
399194 June 29, 2024 03:49 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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United Kingdom CFTC GBP NC Net Positions: £44K vs previous £47.6K
399193 June 29, 2024 03:46 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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Japan CFTC JPY NC Net Positions down to ¥-173.9K from previous ¥-147.8K
399192 June 29, 2024 03:45 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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United States CFTC Gold NC Net Positions: $246.2K vs $243.1K
399191 June 29, 2024 03:40 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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United States CFTC Oil NC Net Positions up to 271.2K from previous 246.8K
399190 June 29, 2024 03:40 FXStreet Market News
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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MUFG: EUR/USD outlook amid French elections and June NFP print
399188 June 29, 2024 03:09 Forexlive Latest News Market News
EURUSD monthly
MUFG discusses the potential impact of the French elections and the June NFP print on EUR/USD. The focus is on the risk premium already priced into EUR/USD and how the election results could influence further movements.
Key Points:
-
Current Situation:
- Stabilization: EUR/USD has stabilized around the 1.0700 level after initially dropping by two big figures following the announcement of snap elections in France.
- Risk Premium: MUFG estimates a 1.0% risk premium is currently priced into EUR/USD.
-
First Round of Elections:
- Impact of Results: The first round of the French elections on Sunday will provide a clearer picture of the support for right and left parties.
- Potential Outcomes:
- Strong Performance by RN & NPF: If right-wing parties like National Rally (RN) and left-wing parties like New Popular Front (NPF) perform strongly, EUR/USD could move closer to the 1.0500 level.
- Surprise from Centrists: If centrist parties or Les Republicains perform better than expected, this could lead to spread narrowing and modest EUR gains.
-
Next WeekÂ’s NFP Print:
- Economic Data: The June Non-Farm Payrolls (NFP) print will also be a key event to watch, potentially adding to EUR/USD volatility depending on the results.
Conclusion:
MUFG highlights that the French elections and the June NFP print will be crucial events for EUR/USD. Strong performances by RN & NPF could push EUR/USD towards 1.0500, while better-than-expected results from centrists could support modest EUR gains. The current 1.0% risk premium suggests that markets are already pricing in some degree of political risk, but the actual election results will likely dictate the direction of EUR/USD in the coming week.
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Few people realize how much disruption is coming from AI
399187 June 29, 2024 02:40 Forexlive Latest News Market News
The future isn’t a mystery.
Generative AI is coming for almost everything.
Why? Machines will soon be able to see and hear in real time and interact with the world. That will unlock robotics.
That’s why Elon Musk is pivoting Tesla to a robotics company. He sees the writing on the wall and realizes that it will be easier to build robots to operate in a closed factory than cars operating on chaotic streets. The main challenge will be constructing the robots and sourcing the raw materials (steel, aluminum, copper and other materials) to build them.
It’s coming quickly and I believe markets and nearly all people are suffering from normalcy bias and normalcy paralysis. That’s a a cognitive bias where people underestimate the likelihood of a disaster or catastrophic event occurring.
The easiest way to envision it — I think — is that unemployment is going to 20%, even in the strongest markets. Jensen Huang is trying to warn us as earlier this week he said AI is coming for the heavy industry.
Here is is this week also warning that agentic AI will take jobs.
I don’t know why people are ignoring it or assume they know better than the guy who built a company that rose to be the biggest in the world.
How does it play out? At first company margins will explode higher as workers are phased out but in time demand will fall because people won’t have money to spend. The price of labor will collapse as a surplus of workers leads to +20% unemployment. The political ramifications are unknowable but undoubtedly chaotic.
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Web3 gaming is the worst-performing category in Q2: MYTH, PRIME, YGG face double-digit losses
399185 June 29, 2024 02:33 FXStreet Market News
- Web3 gaming is the worst-performing narrative of Q2 2024 among top crypto categories this cycle.Â
- Mythos, Echelon Prime, Yield Guild Games noted double-digit declines in the past week, per CoinGecko data.Â
- Relative strength of most top crypto narratives is negative compared to meme coins, per DYOR data.Â
A crypto analyst ranked different categories of cryptocurrencies by their performance in the second quarter of 2024. Meme coins ranked first, while Gaming Finance (GameFi) ranked last in terms of Relative Strength, among other metrics.Â
Mythos (MYTH), Echelon Prime (PRIME), and Yield Guild Games (YGG) are three of the worst-performing GameFi tokens that rank in the top 300.Â
Web3 Game Fi: Worst performing crypto category in Q2 2024
Data from crypto intelligence tracker DYOR shows the relative strength of different crypto token categories, compared with each other and against Bitcoin. Meme coins are the only tokens with a positive relative strength, while most others are negative, as seen in the chart below.Â
Meme coins, Layer 1, and blockchain service tokens are the top 3, while DeFi, DePIN, and Web3 Game Fi are the bottom 3, according to the chart.Â
Relative Strength of Crypto Narratives on DYORÂ
Hitesh Malviya, the analyst behind the X handle @hmalviya9, notes that the best performer among meme coins was DEGEN token, which offered over 1,000% gains to holders.Â
Among the worst performers of the Web3 Game Fi category, as seen on CoinGecko,
- MYTH (ranked 260 by market capitalization) is down over 20% in the past seven daysÂ
- PRIME (ranked 187) is down 17% in the same timeframe
- YGG (ranked 252) is down nearly 10%
Malviya predicts that Q3 early trends favor Blockchain services infra, meme coins, Liquid Staking Tokens (LSTs), and Layer 1 tokens.Â
crypto market Q2 Results:-
> Best Performing Narrative: Memecoins
> Worst Performing Narrative: Web3 Gaming> Best Performer in Memes: $DEGEN > +1000%
> Worst Performer in Web3 Gaming: $DGI < -89.7%Q3 Early trends are in Favour of Blockchain Service Infra, Memecoins, LSTs andÂ… pic.twitter.com/heISG2Tmzq
— hitesh.eth (@hmalviya9) June 28, 2024
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