2023-12-19 20:00

GOLD (XAU/USD) PRICE FORECAST: Gold (XAU/USD) Rallies but Fails to Cross the $2050/Oz Hurdle. Safe Haven Appeal Could Intensify if the Red Sea Issues Continued and Intensified. US Data, the PCE in Particular Could Have a Major Impact on the US Dollar and Where Gold Will End the Week. To Learn More About Price Action, Chart Patterns and Moving Averages, Check out the DailyFX Education Section. MOST READ: AUD/USD Price Forecast: Channel Breakout to Keep Bulls in Control? Gold prices found its legs in the US session rising back above resistance at the $2040/oz level. A slightly stronger US Dollar kept Gold bulls at bay in the European session, but ongoing comments from Fed policymakers around rate cuts continue to weigh on the Greenback. Supercharge your trading prowess with tips and tricks to trading Gold! SAFE HAVEN APPEAL AND US DOLLAR WEAKNESS Geopolitical tensions have become a key driver this week following developments in the Middle East. The Red Sea has become breeding ground of uncertainty, and this seems as if it is only going to intensify. This leaves Gold in the driver’s seat with more gains in store if no solution is found to the ongoing strife and tension in the Middle East. The renewed US Dollar weakness has also assisted Gold hold the high ground and continue its advance. Federal Reserve policymakers have this week struck a dovish tone with most speaking about the amount of rate cuts needed in 2024 with very little push back besides the odd comment about monitoring data moving forward. The only push back in terms of comments came from Policymaker Barkin saying that he thinks inflation is more stubborn than the average Fed official. US Treasury Yields also continued their struggles today with both the 2Y and 10Y yield which is also benefitting Gold. US2Y and 10Y Daily Chart Source: TradingView, Chart Prepared by Zain Vawda US DATA AHEAD US data lies ahead with a key print being the US PCE data which is due on Friday. This may have a significant impact on US rate expectations before the year is out while we also have the final Q3 GDP number. There is other "high impact" US Data due with CB consumer confidence and the final Michigan Consumer Sentiment number which should not have a material impact but rather short-term moves that could be erased toward the end of the trading session. TECHNICAL OUTLOOK GOLD Form a technical perspective, Gold is interesting following the recent selloff which stopped last week as Gold printed an indecisive candle close. This should have given us a sign that we may get further upside this week which has come to fruition but further upside in my opinion appears limited. As things stand a daily candle close above the $2040 mark this could facilitate a run toward resistance at the $2050 mark and beyond with the fundamental picture supporting this narrative. However, I have a feeling that a retracement may come into play soon with a host of resistance area between the $2050 and $2078 handles which may prove to be a hurdle to far. Key Levels to Keep an Eye On: Resistance levels: 2047.00 2058.00 2078.00 Support levels: 2030.00 2012.00 2000.00 Gold (XAU/USD) Daily Chart – December 19, 2023 Source: TradingView, Chart Prepared by Zain Vawda IG CLIENT SENTIMENT Taking a quick look at the IG Client Sentiment, Retail Traders are Overwhelmingly Long on GOLD with 60% of retail traders holding Long positions. Given the Contrarian View to Crowd Sentiment Adopted Here at DailyFX, is this a sign that Gold may struggle to put in more gains going forward. https://www.dailyfx.com/news/gold-price-forecast-bulls-seize-control-on-growing-safe-haven-appeal-2050-up-next-20231219.html

2023-12-19 17:05

US DOLLAR FORECAST: The U.S. dollar extends its retracement as U.S. Treasury yields push lower The greenback retains a bearish profile in the near term, meaning more losses could be around the corner This article examines the technical outlook for EUR/USD, USD/JPY and GBP/USD Most Read: US Dollar in Peril with Core PCE on Deck, Setups on EUR/USD, GBP/USD, USD/JPY The U.S. dollar, as measured by the DXY index, was a touch softer on Tuesday, down about 0.35% to 102.13, undermined by the pullback in Treasury yields, which has continued this week following the Federal Reserve's pivot last Wednesday. For context, the Fed took a more optimistic view of the inflation outlook at the conclusion of its December monetary policy meeting, admitting that discussions of cutting rates have begun and signaling that it will deliver 75 basis points of easing in the coming year, a big shift from its previous stance. With traders increasingly confident that the U.S. central bank will prioritize economic growth over price stability and will slash borrowing costs numerous times in 2024, bond yields are likely to head lower in the near term, creating a hostile environment for the greenback. Positive sentiment and market exuberance triggered by the FOMC’s dovish posture will also act as a headwind for the greenback, boosting riskier and high-beta currencies for the time being. Against this backdrop, we could see new lows for the DXY index before the end of 2023. For a comprehensive analysis of the euro’s outlook, request a copy of our free quarterly forecast now! EUR/USD TECHNICAL ANALYSIS EUR/USD extended its advance and rose for the second straight day on Tuesday, pushing closer toward cluster resistance stretching from 1.1000 to 1.1015. Breaching this barrier may prove challenging for bulls, but a breakout could pave the way for a rally towards the 1.1100 handle. Conversely, if bullish momentum fades and prices turn lower, the 200-day SMA near 1.0830 will be the first line of defense against a bearish assault. The pair is likely to establish a base in this region before staging a comeback, but if a breakdown occurs, a drop toward trendline support at 1.0770 could ensue. EUR/USD TECHNICAL CHART EUR/USD Chart Created Using TradingView USD/JPY TECHNICAL ANALYSIS USD/JPY bucked the broader trend and rallied strongly, soaring more than 1% at one point after the Bank of Japan maintained its ultra-accommodative stance, indicating that it will be difficult to exit negative rates and that uncertainty about the outlook is extremely high. Despite this solid advance, the pair failed to push past resistance at 144.75, with sellers staunchly defending this barrier, as seen in the daily chart below. Looking ahead, it is crucial to monitor price behavior around the 144.75 level, bearing in mind that a breakout could open the door for a move towards 146.00, followed by 147.30. Conversely, a firm rejection from 144.75 may trigger a retracement towards the 200-day simple moving average. On continued weakness, a retest of the December swing lows should not be dismissed. USD/JPY TECHNICAL CHART USD/JPY Chart Created Using TradingView GBP/USD TECHNICAL ANALYSIS GBP/USD accelerated higher on Tuesday, breaching a key Fibonacci level at 1.2720 and pushing towards trendline resistance at 1.2780. This technical barrier must hold at all costs, failure to do so could propel prices above the 1.2800 handle. Should strength persist, the bulls may set their sights on the psychological 1.3000 threshold. On the other hand, if sellers regain the upper hand and spark a bearish reversal, dynamic support is located at 1.2590, which corresponds to a short-term rising trendline extended off the November lows. This trendline should provide stability on a pullback, but in the event of a breakdown, a decline toward the 200-day simple moving average would emerge as the baseline scenario. GBP/USD TECHNICAL CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-on-breakdown-watch-after-fed-pivot-setups-on-eur-usd-usd-jpy-gbp-usd-20231219.html

2023-12-19 12:30

GBP/USD, EUR/USD Prices, Analysis and Charts First US rate cut is seen in March 2024. US dollar pairs little changed in quiet trading conditions. A handful of Fed officials have been on the wires since the end of last week, pushing back against what they see as aggressive market pricing of up to six quarter-point interest rate cuts next year. Messrs Williams and Bostic last Friday started the move saying that interest rate cuts were not being discussed at present, while yesterday Cleveland Fed President Loretta Mester said that markets were getting ahead of themselves in pricing in rate cuts. Chicago Fed President Goolsbee suggested yesterday that markets were hearing what they wanted to hear and not what the Fed was saying. The latest CME Fed Fund rate probabilities show the US central bank cutting rates by 150 basis points next year with the first 25 basis point cut seen at the March FOMC meeting. US Treasury yields remain near multi-month lows with the 10-year benchmark stuck below 4%, while the 30-year long bond is looking to break below the same level. US 10-Year Treasury Yield US 30-Year Treasury Yield The US dollar remains under pressure as government bond yields fall, with the US dollar index unable to regain recent losses. The dollar index continues to make lower highs and lower lows and a move back to the 78.6% Fibonacci retracement level at 101.17 in the near term cannot be ruled out. US Dollar Index Daily Chart Two of the largest US dollar pairs, EUR/USD and GBP/USD, are trying to nudge higher but thin market conditions mean that any move is limited. Cable is trying to break back above 1.2700 after bouncing off the 38.2% Fibonacci retracement yesterday at 1.2628 with 1.2794 likely to cap any breakout. GBP/USD Daily Chart EUR/USD is currently supported by all three simple moving averages after clearing the 20-dsma at the end of last week. Initial support for the pair from this sma at 1..0876 followed by the 23.6% Fibonacci retracement at1.08645. Resistance between 1.1000 and 1.1017. EUR/USD Daily Chart Chart using TradingView What is your view on the US Dollar – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/us-dollar-dxy-latest-markets-ignore-fed-rate-pushback-gbp-usd-and-eur-usd-20231219.html

2023-12-19 11:00

Article by IG Chief Market Analyst Chris Beauchamp Dow Jones, Nasdaq 100, Nikkei 225: Analysis and Charts Dow edges back from peak The index continues to consolidate just below the record high, having gained a remarkable 16% in almost seven weeks.So far there is little sign of any pullback materializing, though it would take less than a 4% drop to return to 36,000. Initial support could be found around 36,954, the previous high. All eyes are now on whether the index can, from its overstretched position, succeed in building a seasonal ‘Santa Rally’. Dow Jones Daily Chart Nasdaq 100 sits just below a record high This index touched its previous record high yesterday, though it shied away from hitting a new milestone.As with the Dow, there is presently no sign of a pullback in the works, so the focus is on whether buyers can succeed in eking out a new record high before the end of the year. In the short-term, some weakness may target the 16,000 area, where the price consolidated in November before its most recent leg higher. Nasdaq 100 Daily Chart Nikkei 225 rallies after BoJ policy decision The Bank of Japan (BoJ) left policy unchanged at its latest meeting, weakening the yen and bolstering Japanese stocks that have dropped back from their November highs over the last month. Recent action has seen the price repeatedly test and then hold above the 50-day simple moving average (SMA). The BoJ’s decision appears to have given the green light to the index to make some new headway to the upside. A challenge of the November highs at 33,830 now looks likely. From there the highs of June at 34,015 come into view, with a longer-term outlook supporting a move to fresh multi-decade highs. Nikkei 225 Daily Chart https://www.dailyfx.com/news/dow-and-nasdaq-100-hold-firm-while-nikkei-225-rallies-20231219.html

2023-12-19 08:17

BoJ, Yen, Nikkei News and Analysis BoJ maintains negative interest rates, focus on wage-price cycle Conditions for BoJ policy pivot in 2024: persistent inflation and wage growth USD/JPY receives modest bid while the Nikkei posts sizable rise BoJ Maintains Negative Interest rates, Focus on Wage-Price Cycle The Bank of Japan (BoJ) voted to keep short term rates at -0.1% and left the yield curve control unchanged. After a Bloomberg report on the 11th of December suggested the final BoJ meeting of 2023 was unlikely to see any movement on rates, the majority of the market eased expectations of a rate hike but clearly some still held out as the yen dropped moments after the announcement. Governor Kazuo Ueda mentioned that there are still many uncertainties around the economy but that officials anticipated modest, above trend growth. The Japanese economy is likely to see an improvement from Q3’s 0.7% contraction (QoQ) as oil prices have come down notably in the final quarter of the year for the net importer of oil. Question marks remain for inflation and wage growth as the bank seeks compelling evidence that both are likely to rise consistently. Conditions for BoJ Policy Pivot in 2024: Inflation and Wages The BoJ’s Ueda stressed not only the incoming data but will also consult companies regarding what has been referred to as the ‘wage-price virtuous cycle’. Ueda mentioned that underlying inflation will gradually increase through FY 2025 but increases will be modest due to lower energy prices. Most importantly, Ueda stressed that the bank is still not in a position to foresee sustainable, stable inflation with sufficient confidence. As long as this remains the case, policy is unlikely to shift but that won’t stop markets from speculating, especially if wage negotiations result in the fastest pace of pay rises in decades. In January trade unions will put forward their demands with the negotiation process coming to an end in March, leaving the BoJ with plenty of information to possibly make a decision to abolish negative interest rates in Q2. The 5-minute USD/JPY chart reveals the immediate rise followed by a volatile spike back down to levels witnessed ahead of the meeting with prices stabilizing around the intra-day high. USD/JPY 5-Minute Chart Source: TradingView, prepared by Richard Snow USD/JPY Receives Modest Boost, Pullback in Focus USD/JPY had witnessed a counter-trend drift in the lead up to the BoJ announcement which has continued in the moments after. The zone of support around 141.50 and the underside of the large ascending channel resulted in a rejection of a move lower – requiring some other catalyst to force a sustained move lower. Friday is a big day for the pair as we get Japanese inflation data and US PCE figures where the possibility of higher Japanese inflation could be coupled with lower US inflation to send the pair lower once again. However, we will have to see what the data reveals. Traders looking for a medium-term bearish continuation will be looking for potential areas of resistance, bringing the pullback to an end. The 145 mark is the most imminent level followed by the 146.50 mark. As we head into Christmas and the notably lower volume that accompanies this period, selling rallies may be something to consider as markets appear to lack the necessary momentum to fight the prevailing trend for extended periods of time. USD/JPY Daily Chart Source: TradingView, prepared by Richard Snow Nikkei Buoyed by BoJ Decision to Stand Pat The Nikkei responded well to the decision to leave rates unchanged and consider incoming data. The index remains near its yearly high of 33,770, a potential level of resistance is today’s move can find subsequent follow through. Price action previously bounced off the 50 SMA, consolidated for a while and then rose this morning. Dynamic support appears at the 50-day SMA followed by 32,307. Nikkei Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/japanese-yen-pared-back-and-nikkei-advances-after-boj-keeps-rates-on-hold-20231219.html

2023-12-18 22:30

AUD/USD PRICE, CHARTS AND ANALYSIS: AUD/USD Holds the High Ground but Could be in for a Retracement. Given the Position of the RBA and the FED Bullish Continuation Appears Likely. IG Client Sentiment Data Shows Traders May Believe a Retracement is Incoming as 51% of Traders are Now Short. To Learn More About Price Action, Chart Patterns and Moving Averages, Check out the DailyFX Education Section. Most Read: Oil Price Forecast: Oil Surges on Supply Chain Concerns as Red Sea Disruptions Intensify AUSTRALIAN DOLLAR FUNDAMENTAL BACKDROP The Australian Dollar has held onto its gains from the past couple of weeks despite a slight recovery from the US Dollar index at the back end of last week. The Australian Dollar has been on a steady move higher since the RBA raised rates at the November meeting. The Australian Dollar has since been on an uptrend as this coincided with the US Dollar weakness and the Federal Reserve Meeting last week. The Australian economy has been showing signs of a slowdown with both services and composite metrics in contractionary territory. If this is the peak rate for the RBA it still puts the Australian Dollar in the driving seat given the comments by Fed Chair Powell. The Fed are expecting 75bps of cuts in 2024 while the RBA are yet to strike such a dovish tone. The RBA could remain hawkish for a bit longer before we see some dovish repricing which could halt the Australian Dollar rally. It will be an interesting end to the year and even more interesting in 2024 as we see how Central Banks navigate their way toward potential rate cuts. THE WEEK AHEAD The rest of the week still brings in a lot of data releases from the US in particular. These releases could see small alterations in the Fed Funds rate expectations for the Federal Reserve. This is likely to persist heading into 2024 as data continues to be released. Right now, however, any data releases are unlikely to have any lasting impact and is likely to only result in short term changes. Earlier this evening we also heard comments from Fed Policymaker Mary Daly who confirmed that 3 rate cuts would likely be needed to avoid overtightening. Daly also said that this would likely depend on inflation, another sign that it is not a given. The recent rise in tensions in the Middle East has the potential to prop inflation up once more and lead to a global economic slowdown as well. Interesting times ahead indeed. PRICE ACTION AND POTENTIAL SETUPS AUDUSD AUDUSD had finally broke out of the channel which had been in play since March 2023. The breakout occurred last week Thursday and since AUDUSD has stalled. Looking at general structure we have just printed a fresh higher high which usually occurs before a pullback. The Dollars resurgence on Friday failed to push AUDUSD lower and thus i am skeptical that the retracement i am looking for will come to fruition. If it does however, i will be paying close attention to the ascending trendline which could come into play, but before that there is support at the 0.6690 and 0.6590 handle which could prove to be stubborn. Alternatively, should AUDUSD continue its move higher from here then immediate resistance rests at 0.6790 and 0.6890 respectively. Key Levels to Keep an Eye On: Support levels: 0.6690 0.6590 0.6500 Resistance levels: 0.6790 0.6890 0.7000 (psychological level) AUD/USD Daily Chart Source: TradingView, prepared by Zain Vawda IG CLIENT SENTIMENT IG Client Sentiment data tells us that 51% of Traders are currently holding SHORT positions. Given the contrarian view to client sentiment adopted here at DailyFX, does this backup my assumption that a retracement may be incoming? https://www.dailyfx.com/news/aud-usd-price-forecast-channel-breakout-to-keep-bulls-in-control-20231218.html