There are positive signals for silver, with demand for the safe-haven asset expected to rise if the Fed ultimately cuts interest rates at its December meeting. Silver prices rose yesterday, forming an upward channel above the 50-day moving average (MA). The Relative Strength Index (RSI) is attempting to exit overbought levels but remains at 73 with a slightly downward channel.
Gold prices surged on Friday, during last week's trading session. The rise in gold prices appears to have been driven by global demand from central banks and expectations of a Fed interest rate cut. The rally is expected to continue this week.
The GBP/USD pair surged sharply amid a more risk-on global sentiment. The USD weakened, as evidenced by the DXY, which fell to a low of 98,820. The RSI indicator is showing overbought signals, suggesting a correction due to profit-taking.
The USDCAD daily timeframe is trending bearish, but yesterday the pair rose by a third of a candle from the previous bearish candle. The market is anticipating a Fed rate cut tomorrow. If the Fed does cut rates, it is expected to depress the USD, and the USDCAD pair will return to a bearish trend. Today, we await the release of JOLTS job openings data.
Expectations are growing that the Bank of Japan will raise interest rates, while the Fed cut rates yesterday. In theory, expectations of a BoJ rate hike support the Japanese yen, while a Fed rate cut weakens the USD. USD/JPY is currently below the middle band on the hourly timeframe.
EURJPY tends to be bullish in the long term; on the hourly timeframe, the price has corrected slightly downwards. Go to the M15 timeframe to look for a buy limit position with a stop loss below the support level, with a medium-term target of around 183
High market volatility is expected today due to the upcoming release of US economic data, such as the CPI and jobless claims. Silver rose yesterday, but on the M15 timeframe, the gains are currently limited, with the price correcting downwards near the lower band. Buy silver as industrial demand remains high and a supply deficit is likely.
The Bank of Japan (BoJ) will announce its interest rate today, with a 25 bps increase expected. If the BoJ does raise rates and the statement is hawkish, the JPY could strengthen sharply.
Although the BoJ raised interest rates, it still hasn't been able to stem the weakening of the JPY. However, rising stock prices, driven by the rate hike, could be a positive catalyst for the yen. Prices are already in the overbought zone, technically indicating the possibility of a pullback or retracement.
The USD remains weak, as evidenced by the DXY falling again yesterday. AUDUSD has been moving sideways in recent hours following Monday's surge. If momentum is strong, the pair is expected to rise again after breaking through its high.
