Gold Steady at Start of Data-Heavy Week, Could Test $2,000

Gold prices are steady during these trading moments on Monday, in thin trading due to the holiday in Asian markets, with investors awaiting speeches by several US Federal Reserve officials in a data-heavy week.

The big risk for gold this week is the US consumer price index, if it comes in higher than expected, it will be another test of the $2000 level.

Trading is expected to be thin during Asian trading hours due to market holidays in China, Hong Kong, Japan, South Korea, Singapore, Taiwan, Vietnam, and Malaysia.

Market participants will focus on US CPI data on Tuesday, retail sales data on Thursday and PPI data on Friday, while also awaiting speeches from Fed officials.

Important and decisive events that will govern the market

US inflation figures on Tuesday will be in the spotlight, as markets look for clues on the timing of interest rate cuts by the Federal Reserve. As the earnings season continues, oil prices look set to remain volatile, while the UK and Japan will release closely watched economic data.

Here’s what you need to know to start your week.

US inflation data

After recent strong jobs and growth data caused markets to backtrack on their bets on the timing of interest rate cuts by the Federal Reserve, all eyes will be on the January inflation report on Tuesday.

Any signs of a price rebound could push bets on rate cuts further into the future.

Economists expect the Consumer Price Index to rise 0.2% from the previous month, for an annual increase of 2.9%. Core inflation is expected to rise 3.8% from the previous year.

Market watchers will also get a chance to hear from several Fed officials during the week, including Thomas Barkin, President of the Richmond Fed, Raphael Bostic, President of the Atlanta Fed, and Mary Daly, President of the San Francisco Fed.

The economic calendar also includes retail sales figures for January on Thursday, along with the weekly report on initial jobless claims, while a report on producer price inflation and preliminary data on consumer sentiment are due on Friday.

Earnings

The earnings season continues next week after the S&P 500 closed above 5,000 for the first time on Friday, and the Nasdaq briefly traded above 16,000, helped by gains in big tech and chip stocks, including Nvidia, along with strong earnings results.

With more than two-thirds of S&P 500 companies having reported results, LSEG data now shows Wall Street expectations for fourth-quarter earnings growth of 9.0%, up from 4.7% on January 1, with 81% of companies beating estimates, compared to an average of 76% in the previous four quarters, according to Reuters.

Investors will look to results from Shopify and Marriott on Tuesday, with Kraft Heinz and Cisco due to report on Wednesday, and Wendy’s and Trivago to release earnings data on Thursday.

Bitcoin approaches the trillion mark and the rise continues

Bitcoin has risen by more than 12% in a week so far, with the largest cryptocurrency now trading at $48,000 per coin and its market capitalization approaching $1 trillion.

Bitcoin’s market cap is now $944,244,360,895 at 1:45 PM Riyadh time, close to the trillion mark, while the total crypto market cap is $1.8 trillion, up 1.8%. Bulls are currently dominating crypto trading, with the Fear & Greed Index at 67 towards greed, indicating buying power in the market at this time.

Bitcoin’s biggest rise came on Friday after data on Thursday showed that bitcoin ETFs had their third-best day on the market on Thursday, prompting asset managers to buy more than 9,000 bitcoins.

Yen continues to recover from lows amid comments from Japanese authorities

The Japanese yen rose in Asian markets on Monday against a basket of global currencies, extending its gains for a second straight day against the US dollar, as it continued to recover from a three-month low, thanks to active buying at low levels.

This rise comes amid intensive comments from Japanese financial and monetary authorities on the currency’s movements in the foreign exchange market, and on the future of monetary policy and negative interest rates.

Japanese Finance Minister Shunichi Suzuki said he is watching currency market movements carefully, using a market phrase for the first time since January 19.

Bank of Japan Governor Kazuo Ueda said on Friday that there is a good chance that accommodative monetary conditions will continue even after.

For further insights, check OneRoyal’s Facebook, Instagram, and Twitter pages and expand your understanding of financial markets with global perspectives.  Staying informed is crucial in the ever-evolving world of finance.

Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances, or needs.

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