Daily Market Analysis

Latest Economic Insights

Key Headlines:

• The dollar holds its decline near 98.8 amid continued concerns over US debt.
• Treasury Department moves in the bond market are pressuring the dollar and supporting alternative assets.
• Gold is hovering near $4,600 and is up by around 13% during August.
• Markets are awaiting the US announcement of additional economic sanctions on Iran.
• Brent crude is near $92 and West Texas near $85.
• Bitcoin is showing breakout signals with a strong rise in trading activity in South Korea.

Fundamental Analysis

• The Dollar and Monetary Policy
  • The dollar index held its decline around the 98.8 level on Monday and remained under pressure after recording significant losses last week, amid continued concerns over the US government debt burden and the rise in long-term borrowing costs.
  • The pressure on the dollar came at a time when US Treasury Secretary Scott Bessent set out the debt buyback strategy, which involves buying back long-term Treasury bonds with the aim of influencing the yield curve, improving liquidity and managing borrowing costs.
  • The Treasury’s intervention contributed to a decline in bond yields and in the dollar, which returned attention to what is known as the currency debasement trade and boosted demand for alternative assets, foremost among them gold.
  • Bessent pointed to the possibility of carrying out further bond buyback operations, explaining that the US administration plans to introduce additional measures to address borrowing costs that have reached their highest levels in years.
  • At the same time, investors are monitoring tensions in the Middle East, with the United States expected to announce new economic sanctions against Iran, while attention turns later this week to the personal consumption expenditures (PCE) price inflation report and the remarks of Federal Reserve Chairman Kevin Warsh at the Jackson Hole symposium for fresh signals on monetary policy.

• Gold:
  • Gold traded near the $4,600 per ounce level on Monday, holding its position close to its highest level in three months, having risen by around 13% since the start of August.
  • The precious metal benefited from concerns related to US debt management and fiscal sustainability, in addition to the decline in the dollar and in yields after the Treasury Department expanded its buyback operations of long-term government debt.
  • Uncertainty over the new US sanctions on Iran also strengthened demand for gold as a safe haven and an alternative store of value.
  • On the other hand, high oil prices remain a potential pressure factor on gold, since a strong return of oil to the upside could lead to renewed inflationary pressures and reduce expectations of interest rate cuts.

• Oil:
  • Brent crude traded near $92 per barrel, while West Texas Intermediate moved near $85, with prices retreating after the recent strong gains amid profit-taking and anticipation of the new US sanctions on Iran.
  • US Treasury Secretary Scott Bessent said that Washington is preparing to impose what he described as the “harshest” sanctions in history, as part of a broad economic isolation campaign aimed at increasing pressure on Iran and its trading partners.
  • These threats come with tensions over the Strait of Hormuz continuing, where Iran still possesses a significant ability to influence shipping movement, energy infrastructure and regional flows.
  • Tehran rejected the US threats, asserting its ability to withstand the impact of the sanctions and to maintain its economic relations with other countries, which leaves markets uncertain about the ability of the new economic pressure to change Iran’s position.

• Bitcoin
  • Bitcoin is moving within an important phase in the short term, with signs emerging of a possible new breakout, coinciding with a notable rise in trading activity.
  • Analyst Michaël van de Poppe considers that a break above the current resistance could push Bitcoin toward $81,000, with the possibility of the move extending toward $82,700, while a failure of the breakout could lead to a correction toward the $74,000 area before an attempt to resume the advance.
  • The South Korean market also witnessed a sharp rise in trading activity, with trading volume on Upbit jumping 273% to $1.84 billion over 24 hours, while on Bithumb it rose 133% to around $934.9 million, bringing total Korean won trading close to $3 billion.
  • Spot trading volumes, Bitcoin ETF flows and leverage indicators remain among the most important factors to monitor in order to assess the strength of the breakout and the sustainability of the current momentum.

Today’s Economic Data (GMT+3 / KSA time)

There is no important economic data scheduled for today.

GOLD

• XAUUSD
• Trend: Bullish
• Timeframe: 30 minutes
• Current price: 4,644.59
• First scenario: Buy on a break above 4,666.32
• Targets: 4,698.10 then 4,733.24
• Alternative scenario: Sell on a break below 4,624.81
• Targets: 4,590.63 then 4,557.89
• Note: Gold is holding a strong bullish structure with rising highs and lows and the price remaining above the moving averages. A break above 4,666.32 supports a continuation of the advance, while a break below 4,624.81 opens the way for a correction toward the lower support areas.

CRUDE OIL

• USOIL
• Trend: Bearish
• Timeframe: 30 minutes
• Current price: 86.88
• First scenario: Buy on a break above 88.36
• Targets: 89.96 then 91.86
• Alternative scenario: Sell on a break below 86.11
• Targets: 84.26 then 82.49
• Note: Oil is under downward pressure after losing the short-term moving averages and is currently trading close to an important support area. A break above 88.36 restores the upward momentum, while a break below 86.11 confirms the continuation of the decline toward 84.26 and then 82.49.

EURUSD

• EURUSD
• Trend: Bearish corrective
• Timeframe: 30 minutes
• Current price: 1.16744
• First scenario: Buy on a break above 1.16970
• Targets: 1.17249 then 1.17602
• Alternative scenario: Sell on a break below 1.16648
• Targets: 1.16305 then 1.16012
• Note: The price is currently trading below the short-term moving averages with clear downward pressure, so a break above 1.16970 restores the positive momentum, while a break below 1.16648 supports a continuation of the correction toward the lower support areas.

GBPUSD

• GBPUSD
• Trend: Bearish corrective
• Timeframe: 30 minutes
• Current price: 1.36385
• First scenario: Buy on a break above 1.36576
• Targets: 1.36905 then 1.37269
• Alternative scenario: Sell on a break below 1.36213
• Targets: 1.35859 then 1.35520
• Note: The price is retreating from the resistance area and is trading below the short-term moving averages. A break above 1.36576 returns control to the buyers, while a break below 1.36213 confirms an extension of the downward correction toward the next support levels.

NAS 100

• NASDAQ – NSDQ
• Trend: Bearish
• Timeframe: 30 minutes
• Current price: 29,071.95
• First scenario: Buy on a break above 29,236.90
• Targets: 29,369.65 then 29,494.85
• Alternative scenario: Sell on a break below 28,943.77
• Targets: 28,775.81 then 28,566.04
• Note: The bearish trend is still clearly in control with the price trading below all the main moving averages, so the negative scenario remains in place as long as the price is below 29,236.90, and a break below 28,943.77 supports a new downward wave.