⛴️ Preliminary conclusion
Tonight, there is no decisive factor driving a continuous rebound. While the US stock market and BTC market are rebounding, the forex market shows risk-off demand, so it is judged that tonight leans towards a false bullish signal.
📈 Key observation of performance targets
After the rebound of gold, there was a significant drop at 23:00, the US dollar showed a clear rebound at 23:00, the Australian dollar remains strong, and the overall trend is a downward fluctuation during the day. US Treasury yields are strongly testing the resistance level, and the Nasdaq is trending upwards.
It is judged that the demand for gold is further declining as the ceasefire between Russia and Ukraine approaches reality, leading to short-term outflow of funds in the gold market into the US dollar market, betting on the weakening of interest rate cut expectations and the resurgence of economic stagnation expectations. This drives the outflow of funds from US Treasuries, resulting in upward momentum in the US stock market due to excessive idle funds in the market.
👔 Key events
1. The unemployment rate met expectations at 4.2%, non-farm employment increased by 177,000, significantly exceeding the expected 133,000, showing a strong job market, and interest rate cut expectations are frustrated.
However, the average hourly wage rate in the US for April (3.8%, expected 3.9%) and month-on-month rate (0.2%, expected 0.3%) both fell short of expectations, but slightly alleviated the inflationary upward expectations brought about by PCE, retaining the possibility of an interest rate cut.
In summary, tonight's employment data is bearish. The simultaneous strength of the US dollar and Australian dollar is a classic risk-off signal transmitted from the forex market to the risk market, therefore it is judged that tonight's rebound is not sustainable.
2. OPEC's June production meeting has been moved up to Saturday (originally scheduled for May 5), Trump warned yesterday that he would prohibit Iranian oil buyers from conducting business with the US.
Therefore, the market is betting that tomorrow's meeting may announce an increase in production to achieve further sanctions against Iran through oil prices, leading to a drop in crude oil prices.
This action may achieve the effect of suppressing inflation (falling oil prices, declining cost of living), becoming a supplement to the expectations of interest rate cuts.
However, as expectations of an economic recession have not dissipated and the geopolitical conflicts involving Iran and India are still lurking, if the increase in production is too large, it may be interpreted as a pessimistic outlook for the future/strengthening expectations of conflict, which would have a bearish effect.
Therefore, it is judged that this information is not sufficient to become a key driving factor for supporting a sustainable rebound.