Whagwan gold diggers,
Gold traders yesterday got real surprised by the yellow metals performance. At the CPI data release price dropped 95 pips but then the mayhem started. Gold was bouncing for hours in a 70 pip range wiping out sellers and buyers.
Manipulation! Market Makers! Big Banks!- the simple souls shouted immediately and some say they still do. Was it really a coordinated attack of the largest banks against their $200 accounts?
-------------
Let's analyze the hard data and find out. The facts that we know now:
U.S. consumer prices increased by the most in 14 months in August as the cost of gasoline surged, but the annual rise in underlying inflation was the smallest in nearly two years. New data showed US consumer prices climbed at an annual rate of 3.7 per cent in August, up from 3.2 per cent in the previous month and marginally above analysts’ forecasts.
The main impact on the headline inflation rate comes from rising energy prices, core inflation remained subdued.
Some items in core inflation are beyond the FEDs control such as motor insurance, shelter, automobile prices etc.
Traders who digged deep down in this data saw this as a green light for the FED to pause with rate hikes . Therefore the probability of pause has gone up to 97% according to FED watch tool.
“The combination of slower core inflation, slower job growth, and an uptick in the unemployment rate in August will almost certainly be enough for the Fed to hold interest rates unchanged,” Bill Adams, chief economist for Comerica Bank.
------------
Conclusion:
Headline CPI was clearly inflationary but looking at the data it is clear now that the culprit for the largest price increase in months was oil and some energy prices. Omitting this variable from the picture leaves us with core inflation remaining subdued.
Now you can see the reason why gold was whiplashing yesterday. On one hand headline inflation was rising a lot, beyond analysts forecast. On the other hand it was due to mostly one single item, oil.
Today's data releases going to have bigger impact.
https://www.tradingview.com/x/OgaiXbIA/
Gold traders yesterday got real surprised by the yellow metals performance. At the CPI data release price dropped 95 pips but then the mayhem started. Gold was bouncing for hours in a 70 pip range wiping out sellers and buyers.
Manipulation! Market Makers! Big Banks!- the simple souls shouted immediately and some say they still do. Was it really a coordinated attack of the largest banks against their $200 accounts?
-------------
Let's analyze the hard data and find out. The facts that we know now:
U.S. consumer prices increased by the most in 14 months in August as the cost of gasoline surged, but the annual rise in underlying inflation was the smallest in nearly two years. New data showed US consumer prices climbed at an annual rate of 3.7 per cent in August, up from 3.2 per cent in the previous month and marginally above analysts’ forecasts.
The main impact on the headline inflation rate comes from rising energy prices, core inflation remained subdued.
Some items in core inflation are beyond the FEDs control such as motor insurance, shelter, automobile prices etc.
Traders who digged deep down in this data saw this as a green light for the FED to pause with rate hikes . Therefore the probability of pause has gone up to 97% according to FED watch tool.
“The combination of slower core inflation, slower job growth, and an uptick in the unemployment rate in August will almost certainly be enough for the Fed to hold interest rates unchanged,” Bill Adams, chief economist for Comerica Bank.
------------
Conclusion:
Headline CPI was clearly inflationary but looking at the data it is clear now that the culprit for the largest price increase in months was oil and some energy prices. Omitting this variable from the picture leaves us with core inflation remaining subdued.
Now you can see the reason why gold was whiplashing yesterday. On one hand headline inflation was rising a lot, beyond analysts forecast. On the other hand it was due to mostly one single item, oil.
Today's data releases going to have bigger impact.
https://www.tradingview.com/x/OgaiXbIA/
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Do you understand how Continuing and Initial Jobless Claims along with PPI might affect gold, dollar and indices? Do you have a macro plan?
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➡️ 🔔 ECB Interest Rates
Euro slips to six-month low after European Central Bank raises interest rates. Investors say ‘dovish’ statement suggests central bank has finished its monetary tightening campaign.
➡️ Surprise, Surprise
China’s economy picked up steam in August as a summer travel boom and a heftier stimulus push boosted consumer spending and factory output, adding to nascent signs of stabilization. Industrial production and retail sales growth jumped last month from a year earlier, far exceeding expectations, while the urban jobless rate eased slightly.
➡️ Not Calling Peak
Federal Reserve Chairman Jerome Powell and his colleagues are likely to shy away from signaling that they’re done raising interest rates when they meet next week. With inflation still above its 2% target and economic growth solid, US central bankers probably will retain a bias toward tighter policy at their Sept. 19-20 meeting even as they hold rates steady. That’s in contrast to the somewhat muddy message that came from the European Central Bank on Thursday as it increased rates. In the parlance of traders, the message from the Fed next week is more likely to be a “hawkish hold” on rates than the “dovish hike” that the ECB is perceived as delivering.
➡️Strong economic reports revived speculation Jerome Powell’s Fed will engineer a soft landing even if it keeps interest rates higher for longer.
🔔 Coming Up…
European shares are set to extend their rally as investors parse through positive Chinese economic data. EU finance ministers hold an informal meeting in Santiago de Compostela, Spain. France and Italy release inflation reports. H&M is scheduled to report quarterly sales.
https://alphafx.eu
➡️ 🔔 ECB Interest Rates
Euro slips to six-month low after European Central Bank raises interest rates. Investors say ‘dovish’ statement suggests central bank has finished its monetary tightening campaign.
➡️ Surprise, Surprise
China’s economy picked up steam in August as a summer travel boom and a heftier stimulus push boosted consumer spending and factory output, adding to nascent signs of stabilization. Industrial production and retail sales growth jumped last month from a year earlier, far exceeding expectations, while the urban jobless rate eased slightly.
➡️ Not Calling Peak
Federal Reserve Chairman Jerome Powell and his colleagues are likely to shy away from signaling that they’re done raising interest rates when they meet next week. With inflation still above its 2% target and economic growth solid, US central bankers probably will retain a bias toward tighter policy at their Sept. 19-20 meeting even as they hold rates steady. That’s in contrast to the somewhat muddy message that came from the European Central Bank on Thursday as it increased rates. In the parlance of traders, the message from the Fed next week is more likely to be a “hawkish hold” on rates than the “dovish hike” that the ECB is perceived as delivering.
➡️Strong economic reports revived speculation Jerome Powell’s Fed will engineer a soft landing even if it keeps interest rates higher for longer.
European shares are set to extend their rally as investors parse through positive Chinese economic data. EU finance ministers hold an informal meeting in Santiago de Compostela, Spain. France and Italy release inflation reports. H&M is scheduled to report quarterly sales.
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Change the way you look at the charts and you'll finally understand everything.
Busy week for central banks as Fed, BoE and BoJ set interest rates
🇺🇸 Federal Reserve chair Jay Powell will kick things off on Wednesday when the Federal Open Market Committee announces its rate decision. He is widely expected to announce the Fed will keep rates at 5.5 per cent.
🇬🇧 There is more uncertainty about the announcement by Andrew Bailey at the Bank of England on Thursday, though a 25 basis point rise is on the cards.
🇯🇵 On Friday it is the Bank of Japan’s turn. No change is the most likely option here, but governor Kazuo Ueda last week raised the possibility of ending the period of negative interest rates by the end of the year.
🇺🇸 Federal Reserve chair Jay Powell will kick things off on Wednesday when the Federal Open Market Committee announces its rate decision. He is widely expected to announce the Fed will keep rates at 5.5 per cent.
🇬🇧 There is more uncertainty about the announcement by Andrew Bailey at the Bank of England on Thursday, though a 25 basis point rise is on the cards.
🇯🇵 On Friday it is the Bank of Japan’s turn. No change is the most likely option here, but governor Kazuo Ueda last week raised the possibility of ending the period of negative interest rates by the end of the year.
📈📉5 Things You Need to Know to Start Your Day 📈📉
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➡️ 🔔 ECB Policy
The European Central Bank will keep interest rates at 4% for as long as needed to tame inflation, Governing Council member Francois Villeroy de Galhau said — indicating he doesn’t favor future increases at this stage. The comments come after the ECB raised borrowing costs last week for a 10th successive meeting — despite push-back from more cautious officials. President Christine Lagarde said she can’t say if that will be the peak, and more hawkish colleagues have since stressed it may not be the last hike.
➡️ Wage Inflation
The wage floor for American workers climbed to a record high close to $79,000, according to a Federal Reserve Bank of New York survey released Monday that also found pay demands among women are rising twice as fast as for men.
➡️ Blopper
Microsoft’s AI research team accidentally exposed a large cache of private data on the software development platform GitHub, according to cybersecurity firm Wiz.
➡️More than one in eight UK bank branches to close in 2023
Financial Times analysis, based on data from ATM provider LINK, shows that a total of 636 bank branches are due to close by the end of this year, with 424 shuttered so far. Some 42 more have already been announced for 2024.
🔔 Coming Up…
European stocks are on track for a steady open with this week's rate decisions in focus. General debate starts at the United Nations’ 78th general assembly. ECB Executive Board member speaks. German Finance Minister Christian Lindner addresses the Bloomberg Future of Finance Conference in Frankfurt. Expected data include Austrian CPI.
https://alphafx.eu
➡️ 🔔 ECB Policy
The European Central Bank will keep interest rates at 4% for as long as needed to tame inflation, Governing Council member Francois Villeroy de Galhau said — indicating he doesn’t favor future increases at this stage. The comments come after the ECB raised borrowing costs last week for a 10th successive meeting — despite push-back from more cautious officials. President Christine Lagarde said she can’t say if that will be the peak, and more hawkish colleagues have since stressed it may not be the last hike.
➡️ Wage Inflation
The wage floor for American workers climbed to a record high close to $79,000, according to a Federal Reserve Bank of New York survey released Monday that also found pay demands among women are rising twice as fast as for men.
➡️ Blopper
Microsoft’s AI research team accidentally exposed a large cache of private data on the software development platform GitHub, according to cybersecurity firm Wiz.
➡️More than one in eight UK bank branches to close in 2023
Financial Times analysis, based on data from ATM provider LINK, shows that a total of 636 bank branches are due to close by the end of this year, with 424 shuttered so far. Some 42 more have already been announced for 2024.
European stocks are on track for a steady open with this week's rate decisions in focus. General debate starts at the United Nations’ 78th general assembly. ECB Executive Board member speaks. German Finance Minister Christian Lindner addresses the Bloomberg Future of Finance Conference in Frankfurt. Expected data include Austrian CPI.
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What a nice move finally🙏🏼 first entry hit SL then entered again and now 50 pips profit on the way.
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Https://alphafx.eu/purchase
Join here:
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Get 50% deposit bonus for tonights FOMC interest rate decision and press conference.
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come and join:
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⚠️ sorry folks. Today’s FOMC events will be live traded only for members. Tomorrow usual live session for public on youtube❤️
Yep, there’s the result of my macro analysis. Join here: https://alphafx.eu