Gold prices stabilized after rising more than 2% on Thursday, as comments from Federal Reserve officials on inflation reduced expectations for further rate hikes. Spot gold traded around $4,480 per ounce, rebounding from a sharp decline on Tuesday and poised for a modest weekly gain.
Federal Reserve Governor Waller said his decision would be “largely” influenced by the upcoming August inflation data to be released next week. If signs of improvement in inflation emerge, he is inclined to keep interest rates unchanged. “But if inflation remains strong, I would consider raising rates,” he added, noting, “Recent data shows we are finally seeing some signs of cooling in inflation.”
Waller also stated that although inflation remains well above the FOMC’s 2% target, recent figures suggest we are finally observing some signs of easing. “If we continue making progress toward the 2% goal, I am willing to support keeping policy rates at their current level.”
A traditional dove, Waller’s remarks, combined with earlier comments from Fed Vice Chair Williams, have cooled expectations for a rate hike. The probability of a September rate increase has dropped from a high of 67% back to around 50%.
Iranian forces continued attacking vessels transiting the Strait of Hormuz and launched missiles toward Jordan, Kuwait, and Bahrain. Israel stated it is prepared to resume combat operations if necessary, saying Iran’s attacks could push it beyond existing constraints, increasing the risk of renewed military escalation.
Brent crude oil approached $96 per barrel, gaining over 7% this week, while West Texas Intermediate (WTI) crude neared $92 per barrel.
Traders are now closely watching Friday’s non-farm employment report and next week’s inflation data for new clues on U.S. monetary policy direction.
Plugin Case Examples
Gold: Prices reached a high of 4,500 overnight, and today are hovering around 4,470, awaiting guidance from the evening’s non-farm data. However, if there’s an opportunity to clear near-term liquidity during the day and then rebound, a trade should be considered.
(Gold 15-minute chart)
Nasdaq: Yesterday, prices quickly surged after clearing the yellow zone of liquidity in the plugin area, rallying strongly from above 29,000 to near 29,500. Today, before the non-farm data release, we will monitor signals for clearing near-term liquidity. If a rebound signal appears, a first attempt can be made. Additionally, place a buy limit order near the demand zone at 29,300.
(Nasdaq 15-minute chart)
Crude Oil: After breaking below 90.22 overnight, prices retraced briefly before resuming their downward move. However, the risk-reward ratio was only about 1.5, falling short of a 2-to-1 target. Today, the 91.50/90.50 range remains the key pivot between bulls and bears, but due to weekend factors, it is advisable to remain cautious for one day.
(Crude Oil 15-minute chart)
Key Financial Data and Events Today:
20:30 U.S. August Non-Farm Employment Report
