Mixed markets as the week begins

US stock markets send mixed signals

US stock markets’ futures seem to start the week rather mixed. Market participants continue to focus on whether hi-tech shares will be able to rebound while key US inflation data and Core Weave’s earnings report in Tuesday’s after-market hours remain key for the week. On a deeper fundamental level, concerns about the strong results of the Democrats in the US midterm elections for possibly tighter regulation in construction energy usage and development costs of AI technology are still present and tend to weigh. Furthermore, we also note the unexpected crisis over the weekend regarding Nvidia, as the company’s Board of Directors is to open an investigation into co-founder and CEO Jensen Huang about an affair with an alleged Chinese spy.

Gold’s price remains stable

Gold’s price rebounded in today’s Asian session, yet overall the precious metal’s price remains relatively stable. It should be noted that gold’s price remained stable despite the stronger-than-expected US employment report for October that seemed to trigger a pullback yet failed to affect gold’s price materially, as the market seems to enhance its expectations for the Fed to tighten its monetary policy.

Oil prices continue to weaken

Oil prices tended to drop in today’s Asian session. Market worries seemed to be enhanced as tensions in the Gulf region escalated over the weekend, yet US President Trump was reported stating that it was highly unlikely that he would order fresh attacks on Iran. Market worries tended to ease, thus weighing on oil prices. Meanwhile, analysts highlight the possibility of an oil glut being created in the market as recovering Middle Eastern oil production boosts flows.

Other highlights for today

Today we note the speeches of Chicago Fed President Goolsbee, Richmond Fed President Barkin and BoE Governor Bailey. In tomorrow’s Asian session we get Japan’s All Household spending, Australia’s business and consumer confidence and later on Norway’s and the Czech Republic’s CPI rates.

As for the rest of the week

In the coming days, in Japan BoJ is to release the summary of opinions for the October meeting, while we highlight China’s trade data, the US CPI rates UK’s and the Euro Zone’s GDP rates and the US final demand PPI rates.

Charts to keep an eye out

Nasdaq tended to stabilise just below the 27050 (R1) resistance line. The bearish outlook is maintained, given that the index’s price action has not regained substantial part of Thursday’s losses, and the RSI indicator remains near the reading of 30, yet we issue a warning or a possible correction higher as the index seems to be at an oversold position. Should the bears maintain control over Nasdaq, we may see it aiming if not breaking the 25375 (S1) support line. For a bullish outlook, which we continue to view as remote, we would require Nasdaq to break the 27050 (R1) resistance line, and start aiming if not breaching also the 28750 (R2) resistance level, opening the way for the 29735 (R3) resistance level.     

XAU/USD’s price action, remained stable between the 3960 (S1) support line and the 4275 (R1) resistance level. Also the RSI indicator remains near the reading of 50, implying a rather neutral stance on behalf of the market for gold’s price, allowing us to maintain a sideways motion bias for the time being. Should the bears take over, gold’s price may drop below the 3960 (S1) support line and start aiming for the 3600 (S2) level. Should the bulls take over we may see gold’s price breaking the 4275 (R1) resistance line and start aiming for the 4550 (R2) resistance base.

Calendar follows

US 100 Cash daily chart

• Support: 25375 (S1), 23965 (S2), 22800 (S3).
• Resistance: 27050 (R1), 28750 (R2), 29735 (R3). 

XAU/USD daily chart

• Support: 3960 (S1), 3600 (S2), 3250 (S3).
• Resistance: 4275 (R1), 4550 (R2), 4890 (R3).