[Morning Session] Inflation aligns with expectations, increasing the likelihood of rate cuts

Gold:

Last week,Download the Oriental Securities Futures app gold showed weakness, primarily declining. However, from a fundamental perspective, there is still support for gold. It is advisable not to maintain a highly pessimistic outlook. The best strategy is to follow the trend.

In the United States, the June Personal Consumption Expenditures (PCE) Price Index rose by 0.1% month-on-month and 2.5% year-on-year, both in line with expectations. The core PCE Price Index increased by 0.2% month-on-month and 2.6% year-on-year, slightly above the predicted 2.5%. The general market view is that the Federal Reserve is making progress on inflation, and overall market sentiment is optimistic.

According to the CME's FedWatch tool, the probability of the Federal Reserve cutting rates by 50 basis points in September has risen to 22.3%. With more signs of economic weakness emerging, it is likely that the Fed will soon open a rate-cut window.

Technical aspect: The daily chart for gold shows a solid medium bullish candle, with a strong long-term moving average support. The price has stabilized above this moving average. On the 1-hour chart, the price broke through an important resistance level. Intraday, the price is likely to rebound, with short-term support around $2384.

Crude Oil:

Last week, crude oil experienced a three-week streak of declines, posing technical risks and marking the longest losing streak since early June. Major international investment banks are somewhat pessimistic about oil prices, mostly maintaining their previous forecasts or slightly lowering their price expectations.

Morgan Stanley maintained its forecast for Brent crude oil prices in the third quarter at $86 per barrel and expects prices next year to fall to the mid-to-high range of $70-$80 per barrel. Earlier this month, Goldman Sachs maintained its forecast for Brent crude oil's average price at $86 per barrel this quarter, lacking the previous confidence in its wording.

The International Energy Agency (IEA) lowered its global crude oil demand forecasts for this year and next year by 100,000 barrels per day and 200,000 barrels per day, respectively. The U.S. Energy Information Administration (EIA) adjusted their demand forecasts, lowering this year's by 70,000 barrels per day and raising next year's by 170,000 barrels per day. However, both agencies expect OPEC+ to increase production in the fourth quarter, with incremental expectations of 100,000 barrels per day and 160,000 barrels per day, respectively.

Technical aspect: The daily chart for crude oil shows a solid bearish candle, struggling to break above the long-term moving averages, indicating overselling. Short-term, there is likely one more downward move. On the 1-hour chart, the price forms a downward pattern at the low point level. Intraday, it is likely to see a new low, with short-term resistance around $78.40.

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The market carries risks, and investment should be cautious. This article does not constitute personal investment advice and has not taken into account individual users' specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at one's own responsibility.