Daily Market Analysis

Latest Economic Insights

Headlines:

• The U.S. dollar weakened amid uncertainty over the Fed’s rate path.
• Gold maintained its gains, supported by continued demand for safe-haven assets.
• Attacks on Saudi oil tankers heightened concerns over potential disruptions to global oil supplies.
• Markets are pricing in a 70% probability of the first U.S. interest-rate hike in September.
• Crude oil prices climbed to their highest levels in six weeks.
• Bitcoin traded near $66,000 amid ongoing inflows into exchange-traded investment funds (ETFs).

Fundamental Analysis

• The U.S. dollar Index and Monatery Policy:
  • The U.S. Dollar Index edged lower to trade near the 101 level on Thursday, extending its modest losses for a second consecutive session as markets continued to balance softer U.S. economic indicators against growing concerns that rising energy prices could reignite inflationary pressures.
  • Despite the pullback, the dollar continues to draw support from geopolitical uncertainty and safe-haven demand amid ongoing military tensions in the Middle East and increasing expectations that restrictive monetary policy may remain in place for longer.
  • Investor focus is now shifting to next week’s Federal Reserve meeting, where markets broadly expect policymakers to leave interest rates unchanged. However, uncertainty surrounding the medium-term policy outlook persists, particularly following ambiguous remarks from newly appointed Federal Reserve Chair Kevin Warsh.
  • Market pricing currently implies two additional 25-basis-point rate hikes by March 2027, with the probability of the first increase occurring as early as September rising to approximately 70%.

• Geopolitical Developments:
  • On the geopolitical front, Iran-backed Houthi forces claimed responsibility for attacks on two Saudi oil tankers in the Red Sea using missiles and drones. The incidents marked the first attacks on oil tankers in the region in months, reigniting concerns over maritime security and potential disruptions to global energy supplies.
  • Meanwhile, U.S. President Donald Trump warned that the United States would target Iranian infrastructure if commercial vessels were attacked in the Strait of Hormuz. Tehran, in turn, stated that it would retaliate against regional energy facilities and critical infrastructure should it face further military action.
  • S. forces also continued military strikes against Iran for a twelfth consecutive day, while Iran responded with attacks on targets in Kuwait, heightening concerns over a broader regional escalation and increased risks to energy markets.

• Gold:
  • Gold remained resilient at $4,130 per ounce, hovering around its highest level in two weeks as escalating geopolitical risks in the Middle East sustained demand for safe-haven assets.
  • Support for the metal was driven by continued dip-buying and defensive positioning by investors amid persistent regional tensions. However, stronger oil prices tempered gains by fueling concerns that inflation may remain elevated for longer.
  • The prospect of prolonged inflation has reinforced expectations that the Federal Reserve could maintain higher interest rates for an extended period, or potentially tighten policy further, creating headwinds for gold.
  • Market participants will continue to monitor Federal Reserve policy decisions, geopolitical developments, and energy market dynamics, as renewed escalation could strengthen safe-haven flows into gold, while a firmer U.S. dollar and higher bond yields may constrain further upside.

• Oil:
  • Crude oil prices advanced to their highest levels in approximately six weeks, with WTI crude trading near $88 per barrel and Brent crude approaching $86 per barrel, as mounting geopolitical tensions fueled concerns over the stability of global oil supplies.
  • The move higher followed attacks on Saudi oil tankers in the Red Sea and reports that a commercial vessel caught fire after being struck near the Saudi coastline, heightening worries about disruptions to critical shipping lanes and energy transportation routes.
  • Escalating tensions between the United States and Iran further increased the geopolitical risk premium in oil markets. Continued U.S. strikes on Iranian targets and Tehran’s retaliatory actions against Kuwait have heightened fears of a broader regional conflict, while prospects for a near-term diplomatic resolution remain limited.
  • Persistent risks to shipping activity in the Strait of Hormuz and the Red Sea continue to underpin oil prices, particularly following the U.S. President’s warning of potential strikes against Iranian infrastructure if additional attacks on commercial vessels occur.
  • Crude markets remain highly exposed to geopolitical developments, with any further escalation likely to reinforce upward price pressure.
  • Conversely, signs of diplomatic progress or easing regional tensions could prompt a correction from recent highs.

• Bitcoin:
  • Bitcoin slipped modestly to trade around $65,884, declining approximately 0.8%, as spot market activity weakened and trading momentum shifted toward the derivatives market.
  • Options positioning remained concentrated in call contracts with strike prices between $70,000 and $72,000 for the July 31 expiry.
  • Despite softer spot volumes, U.S. spot Bitcoin ETFs continued to see sustained investor demand, attracting around $203 million in inflows on Tuesday and marking their sixth consecutive session of positive flows.
  • Separately, Tesla disclosed that it held approximately 11,509 Bitcoin in the second quarter, maintaining its position without any additional purchases or sales since 2022.
  • Bitcoin continues to face resistance at the $66,000 level, while holding above $65,000 remains critical to sustaining the near-term bullish momentum. Market participants are closely watching for fresh catalysts that could support further upside.

Economic Calendar (GMT+3 / KSA time)

Eurozone

European Central Bank Interest Rate Decision (July) – 15:15

United States

Initial Jobless Claims – 15:30 

Federal Reserve Balance Sheet – 23:30  

Smart Technical Analysis — Methodology

A primary scenario is proposed for the day, with an estimated probability of 60% to 75%. If the primary scenario fails, an alternative scenario becomes active, also with an estimated probability of 60% to 75%. The primary scenario is considered invalid once the price reaches the trigger level for the alternative scenario, at which point the alternative scenario is activated and the primary scenario is disregarded. The scenarios and probabilities presented in this report are based on technical analysis and are intended as reference guidance only. These reports are not a substitute for independent trading decisions. Traders should use them as a supporting tool alongside their own analysis and judgment.  

GOLD

• Trend: Bullish
• Timeframe: 30 minutes
• Current Price: 4,124
• Primary Scenario: Buy on a breakout above 4,148
• Targets: 4,180 followed by 4,215
• Alternative Scenario: Sell on a breakdown below 4,108
• Targets: 4,072 followed by 4,039
• Note: Gold continues to maintain its bullish trend despite the current pullback. As long as prices remain above 4,108, the bias favors further upside following a breakout above 4,148.

CRUDE OIL

• Trend: Bullish
• Timeframe: 30 minutes
• Current Price: 89.94
• Primary Scenario: Buy on a breakout above 90.95
• Targets: 92.67 followed by 94.57
• Alternative Scenario: Sell on a breakdown below 88.82
• Targets: 86.97 followed by 85.20
• Note: The bullish trend remains intact, with price trading above key moving averages. A breakout above 90.95 would confirm renewed upside momentum and open the way for a fresh upward move.

EURUSD

• Trend: Bearish
• Timeframe: 30 minutes
• Current Price: 1.1432
• Primary Scenario: Buy on a breakout above 1.1442
• Targets: 1.1470 followed by 1.1506
• Alternative Scenario: Sell on a breakdown below 1.1411
• Targets: 1.1376 followed by 1.1343
• Note: The price has moved above the short-term moving averages but remains below the key resistance level. A confirmed break above 1.1442 is required to support a sustained upside move.

GBPUSD

• Trend: Bearish
• Timeframe: 30 minutes
• Current Price: 1.3390
• Primary Scenario: Buy on a breakout above 1.3412
• Targets: 1.3445 followed by 1.3481
• Alternative Scenario: Sell on a breakdown below 1.3361
• Targets: 1.3326 followed by 1.3292
• Note: The price remains below key moving averages, and failure to break above 1.3412 would reinforce ongoing selling pressure and the bearish bias.

NAS 100

• Trend: Bearish
• Timeframe: 30 minutes
• Current Price: 1.3390
• Primary Scenario: Buy on a breakout above 1.3412
• Targets: 1.3445 followed by 1.3481
• Alternative Scenario: Sell on a breakdown below 1.3361
• Targets: 1.3326 followed by 1.3292
• Note: The price remains below key moving averages, and failure to break above 1.3412 would reinforce ongoing selling pressure and the bearish bias