The EUR/USD currency pair
- Prev Open: 1.0992
- Prev Close: 1.0968
- % chg. over the last day: -0.21 %
Economic news on Wednesday showed that the US GDP for the third quarter was revised upwards. In addition, weakening price pressures in Germany and Spain are dovish for ECB policy, which pressured the euro. German inflation fell from 3.8% to 3.2% (3.5% expected), a 2.5-year low. Spanish inflation fell from 3.5% to 3.2% (expectation of 3.7%). Eurozone inflation data will be released today. The ECB's preferred core consumer price index is expected to fall from 4.2% to 3.9% year-on-year. Given that the Eurozone economy could enter a technical recession in the fourth quarter, lower inflationary pressures and fears of a new energy crisis increase the likelihood that the ECB could go for a rate cut before the Fed does. As a result, further strengthening of the euro is in question.
- Support levels: 1.0960, 1.0941, 1.0887, 1.0851, 1.0822, 1.0756, 1.0729, 1.0700, 1.0664
- Resistance levels: 1.0994,1.1004, 1.1063
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price corrected to the nearest support level of 1.0960, where a flat pattern began to form. Now, the price is squeezed in a narrow corridor, and it is necessary to wait for the initiative of one of the parties. Under such market conditions, it is better to consider buying after an impulse breakout of 1.0993 with a probable target of 1.1063. Selling can be considered after an impulsive breakdown of 1.0960 support level with a target of 1.0887. It is not recommended to trade inside the narrow flat.
Alternative scenario: if the price breaks the support level of 1.0851 and consolidates below it, the downtrend will likely resume.
- – German Retail Sales (m/m) at 09:00 (GMT+2);
- – German Unemployment Rate (m/m) at 10:55 (GMT+2);
- – Eurozone Consumer Price Index (m/m) at 12:00 (GMT+2);
- – US PCE Price index (m/m) at 15:30 (GMT+2);
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
- – Eurozone ECB President Lagarde Speaks (m/m) at 15:30 (GMT+2);
- – US FOMC Member Williams Speaks at 16:05 (GMT+2);
- – US Chicago PMI (m/m) at 16:45 (GMT+2);
- – US Pending Home Sales (m/m) at 17:00 (GMT+2).
The GBP/USD currency pair
- Prev Open: 1.2690
- Prev Close: 1.2694
- % chg. over the last day: +0.03 %
There is a growing view that the US economic growth will slow down in the coming months, and this, combined with slowing inflation, allows the Fed to act faster than previously thought. Therefore, interest rate cuts in the US could begin as early as May next year. In contrast, UK rate expectations suggest that the first 25bp rate cut is scheduled for August 2024, with a total of 75 basis points of bank rate cuts over the year. Recent comments from the Bank of England have warned that UK inflation could remain above target for longer than previously thought. This could be a positive factor in the medium term against the US dollar for the British pound.
- Support levels: 1.2672, 1.2641, 1.2600, 1.2523, 1.2478, 1.2448, 1.2347, 1.2309
- Resistance levels: 1.2713, 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 1.2713, where sellers showed a moderate reaction. At the moment, a flat accumulation is forming, where the support level is 1.2672. The MACD indicator is in the positive zone, but the divergence persists and widens, indicating that the upward momentum is running out. In this case, the fall can be very significant, up to the support levels around 1.2500. But for selling, we need confirmation. Sell deals can be looked for intraday after the breakdown of the support level at 1.2672 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 1.2672, 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: 147.47
- Prev Close: 147.23
- % chg. over the last day: -0.16 %
- Support levels: 146.96, 145.89
- Resistance levels: 147.99, 148.64, 149.41, 149.75, 150.14, 150.93, 151.43
- – Japan Retail Sales (m/m) at 01:50 (GMT+2);
- – Japan Industrial Production (m/m) at 01:50 (GMT+2).
- Prev Open: 2041
- Prev Close: 2045
- % chg. over the last day: +0.19 %
- Support levels: 2037, 2005, 1998, 1979, 1955, 1933, 1918
- Resistance levels: 2048, 2079
- – US PCE Price index (m/m) at 15:30 (GMT+2);
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
- – US FOMC Member Williams Speaks at 16:05 (GMT+2);
- – US Chicago PMI (m/m) at 16:45 (GMT+2);
- – US Pending Home Sales (m/m) at 17:00 (GMT+2).
The USD/JPY currency pair
Bank of Japan's BoJ Governor Adachi said yesterday that it is premature to discuss an exit from negative interest rates, suggesting to wait until at least April 2024. The policymaker said the Bank of Japan (BoJ) needs to patiently continue easing and given current economic indicators and inflation, the central bank is not at the stage of discussing an exit strategy from soft policy at the moment. Such rhetoric from the BoJ officials has negatively affected the Yen exchange rate, and this effect may last for a few days.
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 has found support at 146.96, but the reaction of buyers is moderate, while the MACD divergence targets have been reached. With these market conditions, buying should be cautious. It is important for buyers to take the impulsive initiative from the support level of 146.96. Selling is best considered after the breakdown of 146.96 and price consolidation below. In this case, it will open the way for a further decline to 145.89.
Alternative scenario: if the price consolidates above the resistance level of 150.14, the uptrend will likely resume.
The XAU/USD currency pair (gold)
Precious metals prices showed moderate gains on Wednesday, with gold rising to a 6-month high and silver to a 4-month high. Precious metals rose on Wednesday amid upbeat comments from Fed officials. Fed President Cleveland Mester signaled that she would support the Fed continuing to hold interest rates steady at the December FOMC meeting, while FRB Atlanta President Bostic said the downward trajectory of inflation is likely to continue. Overall, the conditions for growth remain for gold, but given some overbought prices, a technical correction may occur in the near term.
From the point of view of technical analysis, the trend on the XAU/USD is bullish. Now, the price is forming a flat accumulation. 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 2038, we may see a corrective decline to 2018. Selling can be considered only after consolidation below 2038 with the emergence of impulsive sellers' initiatives. 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 , 2023.11.30
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