Dollar Rises on Trump Trade Speculation, Gold Gains on Supply Concerns (07.24.2024)

Check our daily analysis for support and resistance levels of the stated trading instruments. Find valuable insights about Gold, EUR/USD, USD/JPY, and GBP/USD. Stay ahead of market trends with our expert commentary and detailed chart analysis. 

On Wednesday, the dollar index maintained its recent gains around 104.5, nearing two-week highs as investors awaited the latest US manufacturing and services activity data to measure economic health. The dollar was supported by expectations linked to the "Trump trade," which predicts potentially inflationary policies under a second Trump presidency. While former President Donald Trump continues to lead in polls ahead of the November election, Vice President Kamala Harris has been gaining momentum since starting her campaign in Milwaukee, Wisconsin. Regarding monetary policy, the Federal Reserve is widely expected to initiate interest rate cuts starting in September amidst easing inflation, with two additional cuts expected by year-end. The dollar demonstrated strength against most major currencies but faced weakness against the yen.

Gold rose above $2,410 per ounce on Wednesday, extending gains from the previous session. The Q2 GDP growth advance estimate is expected to show a 2% expansion, up from 1.4% in Q1, while the PCE price index is forecasted to see a 0.1% uptick after remaining flat in May. Recently, cooling US headline inflation supported expectations that the Fed may begin cutting rates in September, with two more reductions anticipated before the end of the year.

WTI crude futures climbed above $77 per barrel on Wednesday following a four-session decline, driven by a large decrease in US crude inventories. According to API data, inventories fell by 3.9 million barrels last week, marking the fourth week of declines and surpassing market expectations of a 2.5 million barrel reduction. Additionally, concerns over potential short-term supply disruptions supported oil prices, with ongoing wildfires in Canada threatening over 10% of the region's oil production. However, optimism surrounding ceasefire negotiations between Israel and Hamas exerted downward pressure on prices after Israeli Prime Minister Benjamin Netanyahu hinted at progress toward an agreement.

EUR/USD Faces Early Losses: Resistance at 1.0870

The EUR/USD pair started the day negatively, with the first resistance at 1.0870. Above this level, subsequent resistances to monitor are 1.0900 and 1.0950. On the downside, the initial support is at 1.0845, followed by 1.0810 and 1.0750 if it breaks below.

Critical Levels in Focus for USD/JPY

The first support level for USD/JPY will be 154.50. If this level is breached and maintained below, the next supports to watch will be 154.00 and 153.50. On the upside, the first resistance is at 155.75, and if this level is surpassed, the next targets will be 156.50 and 157.40.

Gold Trends Lower with Key Resistance at $2,430

Gold started the day with a downward movement, with the first resistance level at 2,430. If this level is surpassed, the next targets will be 2,475 and 2,500. On the downside, the first support is at 2,412, and if this level is broken, the next supports to watch will be 2,385 and 2,355.

GBP/USD Faces Key Support at 1.2860

In GBP/USD, the first support is at 1.2860, followed by 1.2820 and 1.2760 below that level. On the upside, the initial resistance is at 1.2940, with further levels at 1.3000 and 1.3050 if the pair moves above that resistance.