Industrial Forex: US dollar bonds suppress gold, gold prices are under pressure before the FOMC meeting

On Wednesday (April 29), the global financial marekt is currently in a highly sensitive turning point. Affected by the continuous changes in the international environment, commodities andforeign exchange marketIt shows obvious negative correlation.Treasury yieldThe recent strengthening of both the US dollar index and the US dollar index has put significant pressure on the price of gold. At the same time,crude oil marketPrices rose significantly as supply-side risk premiums rose again, further strengthening concerns about inflationary pressures.

With the Federal Reserve's April interest rate meeting (FOMC) entering the final decision-making stage, market sentiment has generally turned cautious. Despite the holiday in Japan, market volume has not dropped significantly, reflecting institutional investors' reassessment of possible policy adjustments by the Federal Reserve. With inflation targets falling short for years on end, markets are closely watching whether language related to "additional" easing will be removed from policy statements, which could be a key factor in guiding the direction of global assets in the coming trading days.

Treasury yieldWith the US Dollar: Synchronous Strength Driven by Expectations

From a technical point of view, the dollar index is currently in the high consolidation stage after the rebound repair. The short-term chart shows that the short-period moving average has successfully crossed the medium-term moving average, forming a golden fork arrangement, indicating a strong short-term trend. In the Bollinger Bands indicator, the price runs steadily between the middle and upper tracks, showing strong resistance to falling. Although the momentum indicator has flattened above the zero axis and the bullish momentum has weakened, the dollar still maintains the basic pattern of oscillation and upward movement within a certain range.

The strength of the dollar is accompanied byTreasury yieldRise. 10 yearsTreasury yieldThe current reading is 4.365, the short moving average is in a long order, and the price is running close to the Bollinger Bands, which is in a strong upward channel. Fundamentally, the market generally expects the Federal Reserve to maintain a higher interest rate environment in response to potential policy fluctuations and continued high inflation. The analysis believes that since core inflation has been higher than the statutory target for many years in a row, if the Federal Reserve shows its determination to maintain credibility in this meeting,Treasury yieldIn the short term, there is still kinetic energy in the upper resistance zone. Underlying support is found in the mid-orbit position.

Spot gold: technical rebound after oversold and long-term buying support

The recent performance of spot gold has been relatively weakTreasury yieldThe double impact of the upside and the strengthening of the US dollar, the price has fallen continuously. From the technical shape of the short-term chart, the gold moving average system is arranged in a bearish arrangement, and the short-term price is running close to the lower track of the Bollinger Band after touching the recent low. Although the technical indicators show that the bearish momentum is released more fully, and there is a stop-falling signal, suggesting that there is a demand for a technical oversold rebound in the short term, the overall weakness pattern has not changed.

However, the fundamentals show a different context. According to relevant data, central banks this year increased their gold holdings at the fastest pace in more than a year, with net purchases of gold reaching 244 tons. The entry of some major buyers effectively offset the selling pressure in some countries due to other reasons.Industrial foreign exchangethinkThe pullback in gold prices provides a better opportunity for official institutions that had previously taken a wait-and-see attitude to enter the market. It is expected that gold will seek to balance within a certain support and resistance range in the next few trading days. In the long run, the continued increase in central bank holdings will build a solid bottom guarantee for gold.

crude oil marketThe Resurgence of Supply Premiums and the Transmission of Inflation Expectations

crude oil marketThe price of WTI crude oil has risen to a certain high, setting a new high in nearly a month. Fundamentally, due to geopolitical tensions in some regions, supply-side uncertainty has once again become the dominant force in the market. From a technical point of view, the current key pressure level is relatively clear. Due to the previous rapid price fluctuations, once it effectively breaks through this level, there will be less resistance to a certain range.

The rise in energy prices directly contributes to the market's long-term expectations for global inflation. The rise in crude oil has led to higher transportation and production costs, forcing central banks to consider more aggressive interest rate hike paths to control inflation. In this environment, it is rare for crude oil to strengthen in tandem with the dollar, further amplifying the volatility of risk assets. The trend of crude oil will be highly dependent on the marginal change of relevant information in the next few trading days, and both short-term resistance and support levels are worth watching.

Future Outlook

Looking ahead to the next few trading days, the market will enter a key policy window. Due to the recent rise in inflation expectations, the Federal Reserve is likely to release a hawkish signal in order to maintain its policy credibility, which will continue to support the dollar and the dollarTreasury yieldRun at high levels.

Although gold has the technical basis for oversold rebound in the short term, in the context of a strong US dollar, the rebound height is expected to be limited, and the high probability will remain low. In terms of crude oil, the geopolitical premium is difficult to dissipate in the short term, and high volatility will be the main tone. The overall strategy recommends paying attention to the release of macro data, which will provide a key reference for judging the depth of inflation. The market is in a stage of intense long-short logic game. Investors need to pay close attention to the conversion between support and resistance levels and remain vigilant against liquidity risks.

[Frequently Asked Questions]

1. Why is the central bank buying gold on a large scale, but the price of gold has still fallen recently?

This is due to the mismatch between short-term financial logic and long-term strategic logic. In the short term, gold prices are more affected by the rise in real yields on US bonds and the strengthening of the US dollar, and non-interest-bearing gold is at a disadvantage in carry trades. The central bank's gold purchase is a long-term strategic behavior of sovereign credit reserves, the main purpose is to achieve asset diversification. Central bank buying usually enters the market when the gold price corrects, which provides long-term support for gold prices, but cannot stop the short-term adjustment trend driven by the macro interest rate environment.

2. If the Federal Reserve removes the word "additional" from this meeting, what specific impact will it have on the market?

Deleting "extra" means that the Federal Reserve has officially ended its previous interest rate cutting tendency and turned to neutral or even interest rate hiking bias. This will be interpreted by the market as a more hawkish signal. At that time,Treasury yieldThe US dollar index is expected to strengthen further, while gold and non-US currencies will face a new round of selling pressure.

3. What is the main logic behind the current rise in crude oil prices?

The dominant logic is the geopolitical supply risk premium. The elasticity of crude oil supply is reduced due to uncertainties in some regions. Moreover, despite high global interest rates, manufacturing data in some major economies are performing reasonably well, and there is no cliff-like decline in demand. In the context of tight supply and solid demand, speculative funds have taken advantage of the trend to push up oil prices.

4. Why?Treasury yieldWill the rise depress the price of gold?

Gold, as a physical asset, does not generate interest income by itself. WhenTreasury yieldWhen real interest rates, in particular, rise, the opportunity cost of holding gold increases, with investors preferring to hold higher-yielding, liquid US Treasuries over gold, leading to outflows from the gold market and pressure on gold prices.

5. What economic data should I focus on in the coming days?

Focusing on three data points: first, the Federal Reserve's interest rate meeting statement and related speeches, which are market indicators; second, important manufacturing order data, which can reflect the resilience of the manufacturing industry; third, housing construction data, which will show the impact of high interest rates on the real economy and energy demand.