How will the price of gold, EUR/USD, and Nasdaq 100 react to CPI data?

Gold Forecast, EUR/USD, Nasdaq 100

  • gold prices, EUR/USD And the Nasdaq The number 100 will be very sensitive to the upcoming United States Economic inflation a report
  • The US Bureau of Labor Statistics is scheduled to release consumer price index data for October on Tuesday
  • The headline CPI is expected to rise by 0.1% on a monthly basis and 3.3% on a yearly basis. Meanwhile, the core measure is expected to register 0.3% on a monthly basis and 4.1% on a yearly basis

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Most read: USD forecast depends on US inflation, EUR/USD, USD/JPY, and AUD/USD settings

The US Bureau of Labor Statistics will release Consumer Price Index numbers on Tuesday morning. With the Fed hypersensitive to incoming information and aware of upside inflation risks, the latest CPI report will carry additional weight in the eyes of financial markets. This could mean more volatility for gold, EUR/USD and the Nasdaq 100 in the coming trading sessions.

In terms of estimates, the headline CPI is expected to rise 0.1% on a seasonally adjusted basis in October. This would push the annual rate to 3.3% from 3.7% previously. Meanwhile, the core measure, which excludes food and energy, is expected to rise 0.3% month-on-month, with the relevant 12-month reading remaining unchanged at 4.1%.

Upcoming US data

Source: DailyFX Economic Calendar

The Fed has adopted a data-centric stance and has indicated that it will “proceed cautiously.” Despite this cautious approach, the institution has not completely closed the door on more policy stability, with Chair Powell indicating that officials are not confident they have achieved enough of a restrictive stance to return inflation to 2.0% and that further progress in alleviating price pressures is necessary. Unsecured.

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Taken together, Powell’s comments suggest that the FOMC is not on a predetermined path and is prepared to respond as appropriate to adverse developments that may impede fulfilling its mandates. In this context, any upward deviation of the October CPI numbers from the agreed-upon expectations may prompt policymakers to favor another interest rate hike at one of their upcoming meetings.

Prospects for a Federal Open Market Committee meeting

Source: CME Group

If interest rate expectations turn in a tighter direction on account of the hot CPI report, US yields should rise, strengthening the US dollar. This, in turn, may put downward pressure on gold, the Nasdaq 100, and the EUR/USD pair. The opposite is also true; A downward surprise in last month’s inflation data would support precious metals, technology stocks and EUR/USD by capping yields and undermining the case for a longer-term rally.

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Technical analysis of gold price

Gold has reversed lower this month after failing to clear a major ceiling in the $2010/$2015 area. After this pullback, the metal is located around the 200-day simple moving average, and oscillates near it. If prices consolidate to the upside and settle above this technical indicator in a decisive manner, initial resistance will appear at $1,980, followed by $2,010/$2,015.

On the flip side, if sellers re-emerge and ignite downward pressure, the initial floor to watch is at $1,935, located just above the 50-day SMA. While gold may establish a foothold in this area in the event of a cut, a breakout to the downside could see a drop towards $1,920. Below this limit, interest turns to the $1,900 level.

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Gold price chart (futures)

Gold price chart created using TradingView

Curious about the expected path of the EUR/USD pair and which market drivers should be on your radar? Discover the key insights in our Q4 Euro trading guide!

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Technical analysis of the EUR/USD pair

After encountering resistance at the Fibonacci level at 1.0765, the EUR/USD pair pulled back from the ground, and prices are now hovering above the lower limit of the support range near 1.0650. Maintaining this ground is imperative for bulls. Failure to do so may result in the exchange rate moving towards trend line support at 1.0555. Continued weakness increases the risk of a return to the 2023 lows.

Shifting focus to a bullish outlook, if sentiment sees a sustained rise and the bulls retake control of the market, initial resistance will be located at 1.0765, the area where the 200-day SMA converges with the July 38.2% Fibonacci retracement. /October recession. A successful breakout of this ceiling has the potential to enhance bullish pressure, leading to a rise towards 1.0840.

Technical chart of EUR/USD

EUR/USD chart created using TradingView

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Nasdaq 100 technical analysis

The Nasdaq 100 index broke higher last week, surpassing cluster resistance in the 15,400-15,500 area. If the breakout continues and the Technology Index remains above this range, which now represents technical support, we could see a move towards the September high of 15,720. With more strength, focus shifts to the 2023 peak of 16,062.

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Conversely, if sellers resurface and bulls start liquidating their long positions to take profits amid fears of a possible correction after the recent uptrend, initial support is at 15,500/15,400. If this bottom breaks, we could see a pullback towards 15,200, followed by 14,850. Prolonged weakness increases the likelihood of a decline towards 14,600.

Nasdaq 100 technical chart

Nasdaq 100 chart created using TradingView

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