During the overnight session, the Federal Reserve decided to maintain its current interest rates as expected. However, policymakers anticipate two small rate hikes before the end of the year, signaling a more hawkish stance.
Analysts suggest that the Fed may cut rates by 100 basis points in 2024, with inflation expected to recede rapidly.
Overall, the rate outlook and forecasts may lead investors to anticipate a gradual 25 basis point rate increase starting from the Fed’s next policy meeting in July.
Today, spot gold continued its downward trend, opening at $1943.04 per ounce. In the morning, it reached a high of $1945.19 per ounce and a low of $1931.81 per ounce. Currently, it is trading at $1934.75 per ounce, with a decrease of 0.38%.
There are signs of a breakdown in the gold price, breaking below yesterday’s low of 1938. This has strengthened the short-term downward trend.
If it falls below the support level near the May 30th low of 1931.96, it may further decline toward the key level of 1900.
However, it is important to note that the gold price is still within a range-bound period of nearly a month, which introduces significant uncertainty regarding its future direction.
- Initiate a long position around 1942-1943, with a stop loss at 1935, and a target range of 1953-1955.
- For short positions, assess the market rebound and enter accordingly before the closing session.
WTI Oil >>>
Crude oil traded around $68.4 today, experiencing a 1.5% decline on Wednesday. The drop came after unexpected data revealed a significant increase in U.S. crude oil inventories, coupled with the Federal Reserve’s projection of more interest rate hikes this year.
These developments heightened concerns over demand, leading to a steep decline in oil prices during the latter part of the night, returning to a bearish stance.
Looking at the daily chart structure, Tuesday’s bullish candlestick was short-lived due to the chaotic and disorderly fundamental landscape.
The bulls have struggled to establish confidence amid the unclear fundamentals, and currently, the fundamentals appear relatively clear but bearish, suggesting the market may remain weak in the near term.
Today, considering the high-altitude and low-long strategy:
- On the upside, keep an eye on the $70.4 level, with a potential breakout target at $71.8.
- On the downside, pay attention to the support levels at $68.0 – $66.1. If those levels are breached, the next target on the downside would be $63.8.
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