Gold, Oil Market Analysis: High-Level Washes and Trend Reversal

The Canadian CPI for September, released yesterday, provided a decisive data point, and Xu Gucheng acknowledged that the Bank of Canada should likely accelerate the pace of monetary easing next week. In addition to the unexpected downward trend in overall inflation, broader underlying inflationary pressures also remain under control. With the overall economic activity data being weak and the policy interest rate still significantly above the neutral level, next week's announcement, accompanied by a comprehensive update of economic forecasts, now predicts that the Bank of Canada will lower the benchmark interest rate by 50 basis points to 3.75% at the meeting on October 23rd.

On Tuesday, spot gold rebounded after testing the support at 2634-39, setting a new recent high. On Wednesday, it briefly touched 2670 during the Asian session. Bulls had some profit-taking after the price rebound, while bears bet on a pullback below key levels. Bears started the downward correction from 2664, which was also the resistance level mentioned yesterday. Today, the price broke through and consolidated above this level during the Asian session, indicating that the short-term bullish sentiment remains strong. This bearish defense position has turned into short-term support.

Above this level, the first target for bulls is at 2684, with bullish reduction but a very prominent position. After breaking through 2684, the bearish position exhaustion suggests that bears may avoid short-term positions. The bullish target slightly moves up further, seeing 2709-14. Bears need to first break through 2664 to have further momentum for a pullback. Below 2664, bears mainly aim at 2649 and 2634-39, with the latter's bullish option position prominent, expected to provide support, and the pullback space may be limited before breaking through.

Today's economic data is relatively scarce, and the market needs to pay attention to the U.S. Import Price Index for September. Speeches by Federal Reserve officials, including Chairman Powell, indicate that the Fed's focus has shifted from fighting inflation to maintaining labor market stability, while also being cautious about the future path of rate cuts. Attention should also be paid to the September retail sales data, industrial production data, and weekly unemployment benefits to be released on Thursday, to find clues about consumer health.

Gold: The market is rising after a wash, and the daily line has turned positive and broken through the high, continuing to rise. In terms of rhythm, it fully meets our bullish expectations. However, in terms of the trend, it is not a direct rise but a bottoming out and recovery, continuing to wash. The price broke through the low point of 2640 in the previous two days, seemingly weakening, but the European plate rose strongly, returning to the morning's opening point. Long positions use this position price for defense and will be swept out. If you are looking at a breakdown and falling, yesterday's rebound and short positions will basically fall into the pit. This morning, there was another slow rise, so there is no doubt that gold will continue to rise, and it is possible to touch 2685 again. In terms of intraday operations, Xu Gucheng suggests adjusting the mindset and focusing on buying on dips.

Crude Oil: The curve has shifted down overall, and market pessimism has increased. There may be a large supply surplus. This has once again raised concerns about crude oil demand. Under multiple blows, oil prices have lost their short-term bullish outlook. The support to pay attention to is 69.71 and 66.33. The daily K of crude oil is currently showing a continuous downward trend, and the short-term bearish position is still strong. However, instead of continuing to chase shorts, the opposite should be actively looking for a bottom to see a great opportunity for the second entry of the bullish position. Xu Gucheng suggests laying out long positions at 70-70.2 today, with the daily multi-air watershed at 71 dollars. If the price rises and breaks through this position, crude oil will show a clear acceleration and pull. The maximum limit for the daily bullish position is seen at 72.5! On the contrary, the price will continue to bottom out or switch to a震荡 to continue searching for support and low points! Directly long at 70.2 intraday!