【Evening Session】Gold prices are expected to take off as the rate-setting meeting approaches

Gold:

Gold prices have retreated as risk aversion has cooled somewhat in recent days amid a marked improvement in the outlook for trade between the world's two largest economies.

However, the U.S. Senate has now vetoed the temporary funding bill for the 13th time, leaving the Trump administration in a government shutdown with significant uncertainties remaining. Meanwhile, Israel claims Hamas violated the ceasefire agreement by ordering airstrikes on Gaza, while Hamas denies the violation and postponed the release of hostages after the attacks. These geopolitical tensions are expected to continue supporting gold prices.

Trump has again slammed Federal Reserve Chairman Jerome Powell as either incompetent or bad, saying he will leave office in a few months and suggesting he is still putting pressure on the central bank to cut interest rates.

Chen Yu, senior analyst at Zhisheng Research (exclusively invited by Plotio), said the market is optimistic about another rate cut by the Federal Reserve with the release of the rate decision tonight, and gold prices are expected to rise again.

Technical Analysis: On the daily chart, the market has shown a significant pullback recently. However, the decline stabilized near the 62-day moving average in the previous session, indicating potential for further gains. Technical indicators confirm the market remains above the 62-day MA, maintaining an intact bullish trend. Key levels to watch: $4020 resistance and $3916 support.

Crude Oil:

This morning, U.S. API crude oil inventories for the week ending 24 October showed a 4.02 million barrel decrease, surpassing the previous 2.981 million barrel drop and boosting oil prices. Later tonight, the EIA crude oil inventory data for the same week will be released, which could significantly impact oil prices. Investors should closely monitor this development.

However, recent market news suggests that OPEC producers are more likely to continue increasing production in December this year as part of a strategy to regain market share, and the winter is clearly a slow season for consumption in the Northern Hemisphere, which will significantly accelerate the supply glut.

Investors need to be alert to the situation of European and American sanctions against Russia. If the sanctions continue to increase and lead to a decline in Russia's crude oil production and exports, it will be conducive to the rise of oil prices; otherwise, it is highly likely that crude oil prices will be weak.

Technical Analysis: On the daily chart, the previous trading session saw prices retreat from their peak and close with a bearish candlestick, indicating short-term weakness in oil prices and caution against further declines. The market remains above the 20-day moving average. While the 20-day MA is not yet breached, excessive bearish sentiment should be avoided. Key levels to watch: $62 resistance and $59 support.

U.S. Dollar:

On the one hand, US President Trump recently once again slammed Federal Reserve Chairman Jerome Powell as unreliable. Before the interest rate decision, the intention to pressure the Fed to cut interest rates was probably known to everyone on the planet.

On the other hand, the government shutdown will make the US job market worse. Against the background of the sluggish US job market, it is in the interests of all parties for the Federal Reserve to continue its monetary policy of cutting interest rates. Therefore, we believe it is highly likely that the Federal Reserve will cut interest rates tonight.

According to CME's FedWatch data, there is a 99.5% probability of the Fed cutting rates by 25 basis points in October, which almost completely priced in tonight's rate cut. Meanwhile, there is a 91.6% probability of the Fed cutting rates by 50 basis points in December, suggesting the Fed will cut rates twice more this year.

Technical Analysis: On the daily chart, the market has been trading in a high-range consolidation pattern recently, with short-term correction likely to continue. The 62-day moving average remains above the current price level, suggesting the US Dollar Index is likely to stay resilient in the near term. Investors should monitor support at the 98.73 level during the session.

Nasdaq Index:

On the daily chart, the market has demonstrated strong momentum with consecutive upward sessions closing in the green, suggesting continued bullish momentum in the near term. Technical indicators show the 20-day and 62-day moving averages are forming a bullish crossover, indicating sustained bullish pressure. The 4-hour chart reveals a golden cross between these two moving averages, indicating potential upside potential. Today's trading should focus on the support level around 26,000.

Copper:

On the weekly chart, the market has shown a volatile upward trend with bullish momentum dominating. The daily chart reveals a steady upward movement along the 20-day moving average, currently trading above this key support level, suggesting strong potential for further gains. On the 4-hour chart, traders should watch for a pullback to test the $5.10 support zone at the 20-day moving average.

29 October Market Snapshot:

1. The U.S. government shutdown continues as the Senate rejects a stopgap funding bill for the 13th time.

2. ADP released its weekly estimate of the national employment report, showing an average of 14,250 new jobs createdover the four weeks ending on 11 October.

3. Trump and Takako Kashiwagi signed a framework agreement on securing supplies of critical minerals and rare earths.

29 October Key Data/Events Preview:

1. 22:30 (Beijing Time): U.S. EIA crude oil inventories for the week ending 24 October.

2. 02:00 (Beijing Time): The Federal Reserve's FOMC will announce its interest rate decision.

3. 02:30 (Beijing Time): Federal Reserve Chairman Powell will hold a monetary policy press conference.

[Important Disclaimer: The above content and views are provided by Zhisheng, a third-party cooperative platform, for reference only and do not constitute any investment advice. Investors who trade based on this information shall bear their own risks.]

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