The EUR/USD currency pair
- Prev Open: 1.0953
- Prev Close: 1.0991
- % chg. over the last day: +0.34 %
EUR/USD rose by 0.34% on Tuesday and reached a 3-month-high. Hawkish's comments from the ECB Governing Council representative and Bundesbank President Nagel boosted the euro on Tuesday when he said that the ECB has not yet reached the point where it should consider cutting interest rates. Economic data from Germany also contributed to the rise of the euro. The GfK German Consumer Confidence Index for December unexpectedly rose by 0.5 to minus 27.8, which was stronger than expectations of a decline to minus 28.2. Inflation data will be released today in Germany, where inflationary pressures are expected to ease. This data may weaken the ECB's stance, and on these expectations, the euro may lose some of its past growth.
- Support levels: 1.0994, 1.0941, 1.0887, 1.0851, 1.0822, 1.0756, 1.0729, 1.0700, 1.0664
- Resistance levels: 1.1004, 1.1063
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is trading above the moving averages. The MACD indicator is positive, but divergence is seen on several time frames. A technical correction is looming. Under such market conditions, it is better to consider buying from the support level of 1.0994 but with intraday confirmation and short targets. Sell deals can be considered after a breakdown of the 1.0994 support level, after which a false breakdown zone above will be formed.
Alternative scenario: if the price breaks the support level of 1.0851 and consolidates below it, the downtrend will likely resume.
- – German Consumer Price Index (m/m) at 15:00 (GMT+2);
- – US GDP (q/q) at 15:30 (GMT+2);
- – US FOMC Member Mester Speaks at 20:45 (GMT+2).
The GBP/USD currency pair
- Prev Open: 1.2621
- Prev Close: 1.2747 1.2692
- % chg. over the last day: +0.56 %
There are no important events related to the UK in the economic calendar this week, so the US dollar will create the main dynamics of GBP/USD. Against the backdrop of the dollar's decline, the British pound reached a 3-month-high yesterday. Today, the US will release the Q3 GDP report, and the data is expected to be revised upwards from 4.9% to 5.0%. At the same time, stronger Q4 forecast data is expected. This could give temporary confidence to the US dollar, which will put pressure on risk assets such as the euro and the British pound.
- Support levels: 1.2695, 1.2641, 1.2600, 1.2523, 1.2478, 1.2448, 1.2347, 1.2309
- Resistance levels: 1.2712, 1.2745
From the point of view of technical analysis, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price reached the resistance level at 1.2712, where sellers showed a moderate reaction. The MACD indicator is in the positive zone, but the divergence persists and widens, indicating that the upward momentum is running out. At the same time, the fall can be very significant, up to the support levels around 1.2500. But for selling, traders need to see confirmation. Sell deals can be looked for intraday after the breakdown of the 1.2695 support level and price consolidation under the level. But one more wave of growth up to 1.2745 cannot be ruled out. Buying is better to look for from moving averages near the support level of 1.2641, but also only with confirmation.
Alternative scenario: if the price breaks the support level of 1.2448 and consolidates below, the downtrend will likely resume.
- Prev Open: 148.64
- Prev Close: 147.78
- % chg. over the last day: -0.58 %
- Support levels: 145.89
- Resistance levels: 147.39, 147.99, 148.64, 149.41, 149.75, 150.14, 150.93, 151.43.
- Prev Open: 2014
- Prev Close: 2041
- % chg. over the last day: +1.34 %
- Support levels: 2037, 2005, 1998, 1979, 1955, 1933, 1918
- Resistance levels: 2048, 2079
- – US GDP (q/q) at 15:30 (GMT+2);
- – US FOMC Member Mester Speaks at 20:45 (GMT+2).
The USD/JPY currency pair
In Japan, the weighted median inflation rate is rising at the fastest pace since 2001. The rate was 2.2% in October, up from 2.0% in September, indicating that price pressures in the Japanese economy are intensifying. This growth cycle is likely to challenge the Bank of Japan to make a major decision to exit a prolonged period of ultra-low interest rates. But Kazuo Ueda recently said he is not confident that inflation can sustainably stay above the 2% target, with the BoJ's main focus now on wage growth.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is still bearish, but it is close to changing. The Japanese yen continues to strengthen and break support levels. Yesterday, the price broke through the 147.39 level, and now a flat accumulation is forming below the level. The MACD indicator has turned deeply negative with no signs of reversal. Buying can be looked for only if the price breaks and consolidates above 147.39 but with confirmation in the form of buyers' initiative and short targets. Selling is best considered from the resistance level at 147.39 or from 147.99 in case of a deeper correction.
Alternative scenario: if the price consolidates above the resistance level of 150.14, the uptrend will likely resume.
The XAU/USD currency pair (gold)
The decline of the dollar index on Tuesday to a 3-month low was a favorable factor for metal prices. Yesterday, gold hit a 6-month-high, and silver hit a 3-month-high. A positive factor for gold was the dovish comments from Fed spokesman Waller, who made it clear that he favors a pause in Fed rate hikes. Gold prices are also strengthening on the back of a bearish scenario with the US dollar in 2024. Fed funds futures suggest about 85 bps of cumulative interest rate cuts by December 2024.
From the point of view of technical analysis, the trend on the XAU/USD is bullish. The price confidently broke through the resistance level yesterday and impulsively rushed higher. Now, the price has reached the resistance level of 2048. At the same time, the MACD indicator indicates continued bullish pressure and shows no signs of reversal. Under such market conditions, it is best to look for intraday buying, as the price will not make deep pullbacks on strong growth. But if the price breaks and consolidates below 2037, we may see a corrective decline to 2018. Sell deals can be considered only after consolidation below 2037 with the impulsive sellers' initiative. At the moment, such conditions have not been formed.
Alternative scenario: if the price breaks below the support level of 1965, the downtrend will likely resume.
by , 2023.11.29
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