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29 November 2024,05:42
Daily Market Analysis
29 November 2024, 05:42
*Japanese Yen strengthened after Tokyo CPI came better than market expectation.
*Gold prices were buoyed by the recent lacklustre U.S. dollar.
*Eyes on today’s eurozone CPI reading to gauge the euro’s strength.
Market Summary
The Japanese yen strengthened further following an upbeat Tokyo CPI reading above 2%, reinforcing expectations of a potential BoJ rate hike. USD/JPY fell below the 150 level as market sentiment shifted. Meanwhile, the dollar remained subdued after Wednesday’s PCE report, with the Dollar Index retreating from the 106 mark, reflecting expectations of steady Fed policy.
In commodities, gold edged higher, nearing $2,650, supported by dollar weakness, while oil traders await the rescheduled OPEC+ meeting on December 5 for direction.
Key economic releases today include the Eurozone CPI and Canadian GDP, which are likely to influence the euro and Canadian dollar, respectively.
Current rate hike bets on 18th December Fed interest rate decision:
Source: CME Fedwatch Tool
0 bps (40.4%) VS -25 bps (59.6%)
Market Movements
DOLLAR_INDX, H4
The Dollar Index hovered near a key support level, reflecting flat trading amid subdued liquidity due to the Thanksgiving and Black Friday holidays, which have closed major trading floors in the United States. With an empty economic calendar for the remainder of the week, market participants are adopting a wait-and-see approach. Investors should stay vigilant for future catalysts, including potential updates on Donald Trump’s policies, forthcoming economic data, and signals from the Federal Reserve, which could provide direction for the greenback.
The Dollar Index is trading lower while currently testing the support level. MACD has illustrated increasing bearish momentum, while RSI is at 38, suggesting the index might extend its losses after it successfully breakout since the RSI stays below the midline.
Resistance level: 106.85, 108.10
Support level: 105.80, 104.45
Gold prices consolidated within a tight range but rebounded slightly during the thinly traded Thanksgiving holiday. Previously, gold faced downward pressure following the Israel-Lebanon ceasefire announcement, which boosted risk sentiment and reduced the appeal of safe-haven assets. However, lingering geopolitical risks such as the escalation of the Russia-Ukraine conflict and the potential for trade wars stemming from Trump’s tariff threats on China, Canada, and Mexico could provide underlying support for gold prices.
Gold prices are trading higher while currently testing the resistance level. MACD has illustrated increasing bullish momentum, while RSI is at 51, suggesting the commodity might extend its gains since the RSI stays above the midline.
Resistance level: 2650.00, 2710.00
Support level: 2610.00, 2550.00
The GBP/USD pair broke above resistance at 1.2625, gaining bullish momentum and indicating a bullish bias. Sustaining levels above the key psychological mark of 1.2700 could confirm a bullish trajectory. The pair’s rebound, up over 1.5% from recent lows, is driven by continued weakness in the U.S. dollar.
The GBP/USD has jumped by more than 1.5% from its recent low level and has broken its psychological resistance level at the 1.2700 mark. The RSI has surged to near the overbought zone while the MACD has broken above the zero line, suggesting that the bullish momentum is gaining.
Resistance level:1.2790, 1.2850
Support level: 1.2620, 1.2505
The EUR/USD pair continues to trade within an ascending triangle, with a breakout signaling a potential bullish move. The euro faced pressure after Germany’s CPI missed expectations yesterday. Traders should closely monitor today’s Eurozone CPI release, which could act as a key catalyst for further upside.
EUR/USD is currently poised at its short-term resistance level at the 1.0560 mark, waiting for a catalyst to break above such a level. The RSI remains flowing above the 50 level while the MACD has broken above the zero line, suggesting that the pair is trading with bullish momentum.
Resistance level: 1.0610, 1.0680
Support level: 1.0520, 1.0440
The Japanese yen strengthened, driven by robust inflation data. The Tokyo Consumer Price Index (CPI) for November climbed to 2.6%, up from 1.8% in October, while the core CPI (excluding fresh food and energy) rose to 2.2%, exceeding market expectations of 2.1%. This sustained inflation above the Bank of Japan’s 2% target has intensified speculation about a possible interest rate hike in the near term. Consequently, the yen gained traction, pressuring the USD/JPY pair lower.
USD/JPY is trading lower following the prior breakout below the previous support level. MACD has illustrated increasing bearish momentum. However, RSI is at 29, suggesting the pair might extend its losses since the RSI stays below the midline.
Resistance level: 151.35, 153.80
Support level: 149.10, 146.25
The USD/CAD pair erased most gains after Trump’s comments on raising import tariffs on Canada, pressuring the Canadian dollar. Weak U.S. dollar performance further weighed on the pair, pushing it near recent lows. With Canada’s GDP data due today, a strong reading could bolster the Canadian dollar, potentially driving the pair lower.
The momentum indicators have formed a bearish divergence, which suggests a trend reversal for the pair. The RSI continues to slide while the MACD is about to break below the zero line, suggesting that the pair’s bullish momentum has vanished.
Resistance level: 1.4030, 1.4095
Support level: 1.3960, 1.3900
BTC found support above its prior consolidation range and is edging closer to it’s all-time high above $99K. As November ends, BTC ETFs recorded over $6 billion in monthly inflows, driven by optimism that a potential Trump administration could enhance regulatory clarity for digital assets.
BTC is now testing its resistance level near the 96780 mark; a break above may be seen as a trend reversal for BTC. The RSI is now flowing above the 50 level while the MACD remains below the zero line, which gives a natural signal for BTC.
Resistance level: 101,900.00, 107,700.00
Support level: 92250.00, 88500.00
Oil prices traded flat but remained on a downward trajectory as markets continued to digest the ceasefire agreement between Israel and Lebanon, which alleviated fears of supply disruptions. Attention is now turning to the upcoming OPEC+ meeting on December 5, expected to be held virtually. Reports suggest that OPEC+ may extend its current production curbs, having already postponed its plan to restore 2.2 million barrels per day twice. Oil prices have declined approximately 15% since July, weighed down by weaker demand from China and increased U.S. supplies.
Oil prices are trading flat while currently near the support level. However, MACD has illustrated increasing bullish momentum, while RSI is at 48, suggesting the commodity might edge higher since the RSI rebounded from the oversold territory.
Resistance level: 71.30, 74.00
Support level: 68.25, 66.85
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4 December 2024, 04:41 Oil Jumps Ahead of OPEC Meeting
3 December 2024, 06:00 Upbeat U.S. PMI Boost Dollar
2 December 2024, 06:02 Dollar Gain as Trump Warns BRICS
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