Daily Market Analysis

Latest Economic Insights

Headlines:

• The U.S. dollar holds steady near 99.9 following moderate U.S. inflation data.
• The probability of a September rate hike declines to around 35%.
• Gold stabilizes near $4,350 per ounce after a bout of profit-taking.
• Stalled Strait of Hormuz negotiations keep geopolitical risks elevated.
• Oil extends its decline amid weaker global demand expectations.
• Brent crude trades near $87 per barrel, while WTI hovers around $81 per barrel.
• The International Energy Agency (IEA) and OPEC lower their global oil demand growth forecasts.
• Bitcoin faces weaker technical support amid rising market leverage.

Fundamental Analysis

• The U.S. dollar Index and Monatery Policy:
  • The U.S. Dollar Index traded near 99.9 during Friday’s session, lacking a clear direction after moderate U.S. inflation data prompted investors to scale back expectations for a Federal Reserve rate hike at the September meeting.
  • Data released on Thursday showed that U.S. producer prices were essentially unchanged in July, providing further evidence that inflationary pressures are not accelerating broadly, following the release of a moderate Consumer Price Index (CPI) report a day earlier.
  • As a result, the probability of a 25-basis-point Fed rate hike in September fell to around 35%, down from approximately 55% a week ago, reflecting a notable shift in monetary policy expectations.
  • The moderation in inflation reduces the need for immediate policy tightening by the Federal Reserve, particularly amid signs of softness in certain labor market indicators. However, the central bank is expected to continue closely monitoring economic activity and consumer spending data.
  • As a result, today’s U.S. retail sales report takes on added significance, as it will provide fresh insight into the strength of consumer demand and the economy’s ability to maintain momentum despite elevated borrowing costs.
  • Meanwhile, the latest inflation data suggest that the initial impact of the Middle East conflict and higher energy prices on U.S. inflation is beginning to fade.
  • Nevertheless, negotiations over the reopening of the Strait of Hormuz remain stalled, keeping geopolitical risks elevated and leaving markets vulnerable to any renewed spike in oil prices that could reignite inflationary pressures.

• Gold:
  • Gold held near $4,350 per ounce during Friday’s session after a sharp decline in the previous session, driven by profit-taking following the metal’s strong recent gains.
  • Gold was supported by moderate U.S. inflation data, which reduced expectations for a September rate hike and eased pressure from higher Treasury yields and the opportunity cost of holding non-yielding assets.
  • The metal also remained supported by geopolitical uncertainty surrounding the Strait of Hormuz and continued stalled negotiations between the United States and Iran.
  • However, softer inflation data and lower oil prices have reduced some demand for gold as an inflation hedge, limiting further upside.
  • Gold’s near-term outlook will hinge on U.S. retail sales, with weaker consumption potentially supporting the metal, while stronger data could put renewed pressure on prices.

• Oil:
  • Oil prices extended their decline on Friday, with Brent crude trading near $87 per barrel and WTI around $81 per barrel.
  • The decline came despite continued deadlock over negotiations to reopen the Strait of Hormuz. While geopolitical risks remain elevated, markets are increasingly focused on improving supply conditions and weaker demand expectations.
  • The U.S. estimates that as much as 9 million barrels per day are currently passing through the Strait of Hormuz, while U.S. forces continue to expand their capacity to escort oil tankers, allowing crude flows to continue despite security risks.
  • Some vessels are also continuing to transit the strait with their tracking systems switched off to reduce exposure to potential threats, although shipping activity remains vulnerable to sudden disruptions.
  • On the demand side, the International Energy Agency (IEA) lowered its global oil demand forecast, warning that higher prices and the ongoing conflict are gradually weighing on consumption.
  • OPEC also cut its forecast for global oil demand growth in 2026 to around 580,000 barrels per day, marking its fourth consecutive downward revision.
  • Weaker demand expectations are a clear headwind for oil prices. Despite ongoing risks surrounding the Strait of Hormuz, crude could remain under pressure unless geopolitical tensions escalate or a significant supply disruption occurs.

• Bitcoin:
  • Bitcoin is entering a critical technical phase as support around the 200-week simple moving average (SMA) weakens, after the level served as a key rebound zone in July.
  • Buying interest around the 200-week SMA has declined in August, signaling weakening support and raising the risk of further downside if Bitcoin fails to hold above this level.
  • Derivatives data show that high-liquidity traders have maintained net long positions since mid-March, while open interest in futures remains close to last September’s peak.
  • Meanwhile, buy-side liquidity has fallen by around 33% since July, indicating less available liquidity to absorb selling pressure during sharp market declines.
  • Leverage in the Bitcoin futures market has also increased, with open interest relative to USDT reserves remaining well above pre-ETF levels, despite declining from a peak above 0.5 to around 0.3.
  • Higher leverage makes the market more vulnerable to sudden price swings, as a break below key support levels could trigger a wave of liquidations and amplify downside momentum.
  • Conversely, stronger ETF inflows or a recovery in spot demand could help reduce these risks, although the current setup warrants close monitoring of liquidity and open interest. 

Economic Calendar (GMT+3 / KSA time)

From the Eurozone

GDP (YoY) Q2 — 12:00

From the United States

Core Retail Sales (MoM) July — 15:30

Retail Sales (MoM) July — 15:30

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: Bearish
• Timeframe: 30 minutes
• Current Price: 4,328.96
• Primary Scenario: Buy on a breakout above 4,345.14
• Targets: 4,376.92, then 4,412.06
• Alternative Scenario: Sell on a break below 4,303.63
• Targets: 4,269.45, then 4,236.71
• Note: Gold is trading below its moving averages amid clear selling pressure. A breakout above 4,345.14 could trigger a bullish correction, while a break below 4,303.63 would reinforce the downside trend.

CRUDE OIL

• Trend: Sideways with a bearish bias
• Timeframe: 30 minutes
• Current Price: 83.40
• Primary Scenario: Buy on a breakout above 83.93
• Targets: 85.65, then 87.55
• Alternative Scenario: Sell on a break below 81.80
• Targets: 79.95, then 78.18
• Note: Oil is trading within a sideways range near its moving averages. A breakout above 83.93 would support a recovery in bullish momentum, while a break below 81.80 would confirm further downside.

EURUSD

• Trend: Sideways with an upward bias
• Timeframe: 30 minutes
• Current Price: 1.15387
• Primary Scenario: Buy on a breakout above 1.15490
• Targets: 1.15769, then 1.16122
• Alternative Scenario: Sell on a break below 1.15168
• Targets: 1.14825, then 1.14531
• Note: The pair is attempting to stabilize above its short-term moving averages. A breakout above 1.15490 would support further upside, while a break below 1.15168 would bring selling pressure back into play.

GBPUSD

• Trend: Sideways
• Timeframe: 30 minutes
• Current Price: 1.34980
• Primary Scenario: Buy on a breakout above 1.35123
• Targets: 1.35452, then 1.35816
• Alternative Scenario: Sell on a break below 1.34760
• Targets: 1.34406, then 1.34067
• Note: The pair is trading within a sideways range near its moving averages. A breakout above 1.35123 would confirm a bullish move, while a break below 1.34760 would confirm further downside.

NAS 100

• Trend: Bullish with consolidation
• Timeframe: 30 minutes
• Current Price: 30,060.84
• Primary Scenario: Buy on a breakout above 30,217.24
• Targets: 30,349.99, then 30,475.19
• Alternative Scenario: Sell on a break below 29,924.11
• Targets: 29,756.14, then 29,546.38
• Note: The index is holding above its moving averages following a strong rally. A breakout above 30,217.24 would support further upside, while a break below 29,924.11 could trigger a downside correction.