Plethora of financial releases coming up

Australia’s Q2 GDP rates eyed

The FX market presented little volatility and on a fundamental level the rise of yields on a global level tends to worry investors for possible monetary and fiscal implications. The plethora of financial releases today, could generate some interest. In today’s American session, we note the release of the US ISM manufacturing PMI figure for August and a possibly higher than expected reading could provide some support the USD. We note the release of New Zealand’s RBNZ interest rate decision, which is expected to hike rates and if it is accompanied by a hawkish forward guidance, we may see the Kiwi getting some support. We also highlight the release of Australia’s GDP rates for Q2. A possible acceleration of the rate could renew the support for the Aussie as it would imply that the Australian economy grew at a faster pace than anticipated.

Low volatility for US stock markets

Dow Jones and S&P 500 corrected lower while Nasdaq remained relatively stable. Overall US equities ended August in the greens though Nasdaq was unable to fully recover July’s losses. On a fundamental level, the rise of oil prices tends to weigh on US equities as do any hawkish intentions of the Fed. 

Oil prices maintain Monday’s gains

Oil prices were able to maintain yesterday’s gains and edge even a bit higher in today’s Asian session. The tensions in the Middle East failed to ease yesterday with US President Trump threatening further strikes against Iran. Market worries for the supply side of the oil market remain high and a possible intensification of the US-Iran conflict may provide additional support for oil prices.

Gold stabilises for now

Gold’s price tended to stabilise yesterday and during today’s Asian session, failing to recover any of Friday’s losses. We consider the negative correlation with the USD as still being active and consider the Fed’s intentions as the key driver behind its direction with any intentions of monetary policy tightening potentially weighing on the precious metal’s price. We consider as the next big test for gold’s price to be the release of the US employment report for August on Friday.

Other highlights for today

Today we get August’s Euro Zone’s preliminary HICP rates and US ISM manufacturing PMI figure, the US JOLTS job openings for July, and the weekly US API crude oil inventories figure. In tomorrow’s Asian session, in Japan BoJ board member Takata speaks.

Charts to keep an eye out

Gold’s price remained relatively stable, well between the 4550 (R1) resistance line and the 4275 (S1) support level. The lack of volatility allows us to maintain yesterday’s sideways motion bias for the time being. The RSI indicator remained near the reading of 50, implying a continuation of the market’s neutral stance for gold’s price. Should the bulls regain control over the precious metal’s price direction, we may see it breaking the 4550 (R1) resistance line and start aiming for the 4890 (R2) resistance level. Should the bears take over, we may see gold’s price breaking the 4275 (S1) support line and start aiming for the 3960 (S2) support level. 

WTI’s price edged higher in today’s Asian session yet is still well between the 88.60 (R1) resistance line and the 82.00 (S1) support level. The RSI indicator remained above the reading of 50, implying some bullish tendencies for WTI’s price. Overall, we maintain a bias for a sideways motion of WTI’s price at the current stage yet warn for any possible bullish tendencies of the commodity’s price action. Should the bulls lead WTI, we may see WTI breaking the 88.60 (R1) line and start aiming for the 93.30 (R2) area. Should the bears be in charge, WTI’s may break the 82.00 (S1) line and start aiming for the 76.60 (S2) base.

Calendar follows

XAU/USD daily chart

• Support: 4275 (S1), 3960 (S2), 3600 (S3).
• Resistance: 4550 (R1), 4890 (R2), 5245 (R3). 

WTI daily chart

• Support: 82.00 (S1), 76.60 (S2), 71.85 (S3).
• Resistance: 88.60 (R1), 93.30 (R2), 98.50 (R3).