2023-12-12 07:41

POUND STERLING ANALYSIS & TALKING POINTS UK labor statistics should keep the BoE’s prediction to resist rate cuts on course. US CPI & ZEW economic sentiment to come. Pound crosses display hesitancy ahead of key economic releases. POUND FUNDAMENTAL BACKDROP Interest rate expectations (refer tot able below) for the BoE did not change post-announcement with markets forecasting roughly 75bps of cumulative rate cuts by December 2025 with the first cut taking place around June/August. The BoE rate decision on Thursday will most likely see Governor Andrew Bailey push back against rate cuts and maintain the higher for longer narrative that could buoy the pound. BANK OF ENGLAND INTEREST RATE PROBABILITIES Source: Refinitiv Of recent, the pound has been largely dictated by shifts in money market pricing for the European Central Bank (ECB) and Federal Reserve. The euro area looks to far weaker than the UK according to latest economic data while the US will look to this afternoons CPI for guidance. TECHNICAL ANALYSIS GBP/USD DAILY CHART Chart prepared by Warren Venketas, IG Daily GBP/USD price action keeps bulls hovering above the 200-day moving average (blue) and the 1.2500 psychological handle. Elevated US CPI could see a retest of these support levels, possibly brining into consideration the 1.2400 zone once again. Key resistance levels: 1.2900 1.2848 1.2746 Key support levels: 1.2500 200-day MA 1.2400 MIXED IG CLIENT SENTIMENT (GBP/USD) IG Client Sentiment Data (IGCS) shows retail traders are currently equally SHORT AND LONG on GBP/USD with 50% of traders holding both positions (as of this writing). EUR/GBP DAILY CHART Chart prepared by Warren Venketas, IG EUR/GBP on the other hand has been consolidating of recent with multiple doji candle closes indicative of indecision by traders, forming a rectangle pattern (blue). A breakout is looming and is likely to be catalyzed by the upcoming central bank decisions. The pair is attempting to come out of oversold territory (Relative Strength Index (RSI)) with some early signs of bullish divergence that could hint at an upside breakout. That being said, fundamentals point to more support for the UK and may extend the recent downtrend. Key resistance levels: 200-day MA (blue) 0.8650 0.8600 Key support levels: 0.8549 0.8524 0.8500 BEARISH IG CLIENT SENTIMENT (EUR/GBP) IG Client Sentiment Data (IGCS) shows retail traders are currently net LONG on GBP/USD with 74% of traders holding LONG positions (as of this writing). https://www.dailyfx.com/news/forex-gbp-breaking-news-mixed-uk-jobs-report-should-not-deter-boe-wv-20231212.html

2023-12-11 23:50

NASDAQ 100, GOLD PRICE FORECAST Gold prices and the Nasdaq 100 are poised for heightened volatility in the coming days, with several high-impact events on the calendar later this week Market focus will be on the U.S. inflation report on Tuesday and the Fed’s monetary policy announcement on Wednesday This article examines gold and the Nasdaq 100’s technical outlook, analyzing sentiment and critical price levels to watch Most Read: US Dollar Forecast - All Eyes on US Inflation, Setups on EUR/USD, USD/JPY, GBP/USD Focusing first on inflation, headline CPI is forecast to have flatlined in November, bringing the annual rate to 3.1% from October’s 3.2%. Meanwhile, the core gauge is seen rising 0.3% on a seasonally adjusted basis, with the 12-month related reading unchanged at 4.0%, a sign that the underlying trend remains sticky and uncomfortably high for policymakers. Since mid-November, interest rate expectations have shifted lower, with traders discounting about 100 basis points of easing over the next 12 months. For this dovish outlook to be validated, CPI figures will have to show that the cost-of-living growth is rapidly converging to the 2.0% target; failure to do so could trigger a hawkish repricing of the Fed’s path – a bearish outcome for precious metals and tech stocks. Turning to the December FOMC meeting, no changes in rates are anticipated, but the bank could offer hawkish guidance to avoid further relaxation of financial conditions, with odds of this outcome likely increasing in the event of a hotter-than-projected CPI report. If this sequence of events transpires, we could see yields and the U.S. dollar trend upwards, creating a hostile environment for gold and the Nasdaq 100. Eager to gain insights into gold's outlook? Get the answers you are looking for in our complimentary quarterly trading guide. Request a copy now! GOLD PRICE TECHNICAL ANALYSIS Gold (XAU/USD) broke its previous record, briefly reaching an all-time high last week, but was unable to sustain its advance, with the bullish breakout swiftly turning into a large selloff in the days that followed – a sign that sellers have regained the upper hand for now. While bullion retains a constructive outlook over a medium-term horizon, the yellow metal’s prospects might deteriorate if its value slips below technical support in the $1,965-$1,960 area. This scenario could send prices reeling towards the 200-day simple moving average at $1,950, with a subsequent drop towards $1,930 likely in the case of sustained weakness. On the other hand, if XAU/USD stabilizes and begins to rebound, the first technical barrier to consider appears at $1,990 and $2,010 thereafter. Sellers are expected to vigorously defend the latter level, but a breakout could open the door for a retest of the $2,050 area. On further strength, the bulls may set their sights on $2,070/$2,075. GOLD PRICE TECHNICAL CHART Gold Price Chart Created Using TradingView NASDAQ 100 TECHNICAL ANALYSIS The Nasdaq 100 has breached an important ceiling by decisively blasting past the 16,100 area. If this bullish burst is sustained, the focus will be on trendline resistance at 16,500. With the tech index in overbought territory, a potential rejection at 16,500 is plausible. However, if a breakout materializes, a retest of the all-time high might be imminent. Conversely, if sentiment swings back in favor of sellers and prices head lower, initial technical support stretches from 16,150 to 16,050. Although this floor may provide some stability during a pullback, a push below this range could set the stage for a drop towards 15,700. On further weakness, sellers may get emboldened to initiate an assault on trendline support near 15,550. NASDAQ 100 TECHNICAL CHART Nasdaq 100 Chart Created Using TradingView https://www.dailyfx.com/news/xau-usd-gold-price-outlook-rests-on-us-inflation-fed-s-guidance-nasdaq-100-breaks-out-20231211.html

2023-12-11 21:30

OIL PRICE FORECAST: Oil Continues to Advance as Supply Concerns and Potential Rebound in Demand Keep Prices Elevated. Saudi Energy Minister to Provide a Further Update this Week on the Potential for Further Cuts or an Extension into 2024. IG Client Sentiment Shows Traders are 79% Net-Short on WTI at Present. To Learn More About Price Action, Chart Patterns and Moving Averages, Check out the DailyFX Education Section. Most Read: What is OPEC and What is Their Role in Global Markets? Oil prices fluctuated and eked out marginal gains during the Asian and European sessions before a rally in the US session saw WTI reach a daily high around 71.77 (at the time of writing). There are still murmurs around many circles indicating the caution and indecision of market participants as they grapple with growth concerns for 2024. GLOBAL GROWTH FEARS AND IMF WARNING Oil appears to be experiencing a difficult phase at present with uncertainty around the global economic picture in 2024. The disagreements by OPEC+ members at the recent meeting gives one the idea that further cuts may be difficult to achieve by the group should weak demand and slow global growth hamper Oil prices. This has kept Oil prices subdued with bulls appearing slightly hesitant despite the $23 + drop since the recent highs in the mid $90 a barrel range. Citi Bank this morning stated their belief that OPEC+ will be able stabilize Oil prices in the $70-$80 range in 2024, but that this would require an extension of the recently announced cuts. This is double edged sword in a way with OPEC+ members seeing reduced revenue and smaller volumes, but this is likely to be worse without the cuts. The expectation is that non-OPEC+ member states will see output increase, and this will lead to excess supply in 2024, while the ongoing uncertainty around Chinese demand also remains a concern. The IMF Deputy Managing Director Gita Gopinath today stressed that she is seeing signs of fragmentation in the global economy, with meaningful shifts in underlying bilateral trade. Gopinath added that if the global economy fragments into two Blocs over the Ukraine war global losses could be 2.5% to 7% of global GDP. This will add another layer of concern for global markets in 2023. PORTFOLIO INVESTORS BEARISH ON OIL It appears portfolio managers have rarely been so bearish on their crude oil outlook with the US leading the way. Hedge funds and other money managers sold the equivalent of 58 million barrels in the six most important petroleum futures and options contracts until December 5. Other takeaways from the Reuters report revealed Funds had reduced their net position in NYMEX and ICE WTI to less than 48 million barrels, among the lowest levels in the last decade while they have only been more bearish on WTI at the end of June 2023. This could be worth paying attention to moving forward as most funds have concluded prices will fall further first to force U.S. shale producers to curb output and remind OPEC⁺ members of the risks of a production free-for-all. LOOKING AHEAD Looking to the rest of the week and US data could have an impact on the US dollar and thus weigh on Oil prices. There is of course the FOMC meeting and other Central Bank meeting which could also have an impact on sentiment. A dent to sentiment could also weigh on Oil prices while increasing expectations of rate cuts in early 2024 could assist the recovery back toward the $80 a barrel mark. TECHNICAL OUTLOOK AND FINAL THOUGHTS From a technical perspective WTI finished last week strong with what many would describe as a Morningstar candlestick pattern which hints at further upside. Immediate resistance rests just above the $72 a barrel mark with a move higher running into the 20-day MA at 74.63. Alternatively, a push lower from here may find support at the psychological $70 a barrel mark. A break here brings the multi-month support around the $67 a barrel level into focus. WTI Crude Oil Daily Chart – December 11, 2023 Source: TradingView Key Levels to Keep an Eye On: Support levels: 70.00 67.00 65.00 Resistance levels: 72.16 74.63 75.00 IG CLIENT SENTIMENT IG Client Sentiment data tells us that 87% of Traders are currently holding LONG positions. Given the contrarian view to client sentiment adopted here at DailyFX, does this mean we are destined to revisit the lows at the $67 mark? https://www.dailyfx.com/news/oil-price-forecast-oil-eyes-continued-recovery-but-market-participants-remain-cautious-20231211.html

2023-12-11 19:30

USD OUTLOOK – PRICE ACTION SETUPS ON EUR/USD, USD/JPY, GBP/USD Higher volatility could be on the menu for the U.S. dollar this week, courtesy of several risk events on the economic calendar The November U.S. inflation report will steal the limelight on Tuesday This article examines the technical outlook for EUR/USD, USD/JPY and GBP/USD, discussing pivotal price thresholds ahead of U.S. CPI data Most Read: US CPI, Fed Decision to Guide US Dollar, Setups on EUR/USD, USD/JPY, GBP/USD Over the past month, U.S. interest rate expectations have shifted lower on bets that the Federal Reserve would move to slash borrowing costs aggressively next year. This scenario, however, likely hinges on inflation falling faster towards 2.0%; otherwise, there would be little appetite among policymakers to loosen policy in a meaningful way. We will get more clues about the overall trend in consumer prices tomorrow, when the U.S. Bureau of Labor Statistics unveils November’s numbers. According to estimates, headline CPI was flat last month, bringing the annual rate down to 3.2% from 3.1% previously. Meanwhile, the core gauge is seen rising 0.3% m-o-m, resulting in an unchanged 12-month reading of 4.0%. UPCOMING US DATA ON TUESDAY To validate the dovish monetary policy outlook contemplated by Wall Street, the latest CPI report will have to demonstrate that the cost of living is moderating at a satisfactory pace. Failure to do so could trigger a hawkish repricing of interest rate expectations, pushing U.S. Treasury yields sharply higher and boosting the U.S. dollar. In summary, an upside surprise in inflation data showing sticky pressures in the underlying trend will be bullish for yields and the U.S. dollar, whereas softer-than-expected numbers could have the opposite effect on markets. For a complete analysis of the euro’s medium-term prospects, request a copy of our latest forecast! EUR/USD TECHNICAL ANALYSIS EUR/USD rose sharply in November, but has sold off this month, with the pair slipping below the 200 and 100-day simple moving averages – a bearish technical signal. Should this pullback persist later this week, a retest of the 50-day SMA could occur at any moment. Further weakness might redirect attention toward trendline support around the 1.0620 mark. On the flip side, if EUR/USD mounts a comeback and pushes higher, technical resistance appears near 1.0820, but further gains could be in store on a move above this barrier, with the next key ceiling located at 1.0960, the 61.8% Fibonacci retracement of the July/October slump. Sustained strength might prompt a revisit to November’s high points. EUR/USD TECHNICAL CHART EUR/USD Chart Prepared Using TradingView USD/JPY TECHNICAL ANALYSIS The Japanese yen appreciated significantly against the U.S. dollar last week on speculation that the Bank of Japan would soon end its policy of negative rates. However, the move unwound sharply on Monday, with USD/JPY shooting higher on media reports that the BOJ is not yet fully convinced that wages will grow sustainably to justify the imminent abandonment of its ultra-dovish stance. If the pair’s rebound extends in the near term, resistance stretches from 147.00 to 147.50. On further strength, the focus shifts to the 50-day simple moving average, followed by 149.90. Conversely, if the bears regain control of the market and spark weakness, initial support rests at 146.00 and 144.50 thereafter. Looking lower, the next key floor to watch appears near 142.30. USD/JPY TECHNICAL CHART USD/JPY Chart Created Using TradingView Stay ahead of the curve! Claim your complimentary GBP/USD forecast for a thorough overview of the British pound's prospects! GBP/USD TECHNICAL ANALYSIS GBP/USD has been on a downward path in recent days after failing to overcome an important ceiling at 1.2720, which corresponds to the 61.8% Fibonacci retracement of the July/October selloff. Should losses continue this week, technical support spans from 1.2500 to 1.2460, where the 200-day simple moving average aligns with a short-term ascending trendline. Further weakness could shift attention to 1.2340. On the flip side, if cable manages to rebound from its current position, overhead resistance looms at 1.2590. To revive bullish sentiment, the pair must breach this barrier decisively – doing so may attract new buyers into the market, setting the stage for a rally towards 1.2720. Surmounting this barrier might pose a challenge for the bulls, but a breakout could pave the way for an upward move beyond 1.2800. GBP/USD TECHNICAL CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-forecast-all-eyes-on-us-inflation-setups-on-eur-usd-usd-jpy-gbp-usd-20231211.html

2023-12-11 17:30

BITCOIN, CRYPTO KEY POINTS: Bitcoin Remains Above the 40k Mark Which Remains Key for Further Downside. Crypto Industry Resilience on Display with Latest Research Piece Reveals 83% of Crypto Mentions are Positive. Over $300 Million in Long Positions Liquidated Following Todays Slump in Prices. To Learn More AboutPrice Action,Chart Patterns and Moving Averages,Check out the DailyFX Education Series. READ MORE: EURO Weekly Forecast: ECB Expected to Hold Rates but How Will Projections Differ from Market Expectations? Bitcoin (BTC/USD) Sank as much as 7.5% overnight to a low of around $40520, which is just a whisker away from the psychological $40000 level. I had discussed the possibility of this potential pullback last week in my article (to read click here). There does not appear to be any singular driving force behind the move except perhaps the slightly stronger US Dollar. I however think that this is in part down to profit taking ahead of the Risk Events this week and the end of year holidays. Source: TradingView WILL THE $40K LEVEL SUPPORT HOLD? The $40 k mark could hold the key heading into the festive break. A break below this level could open up the potential of a deeper retracement down toward the $31k-$32k area. As mentioned above I believe that part of the move is likely down to profit taking as we do have a bunch of risk events ahead. The move down may be welcomed by many, particularly institutions who may want to get involved before the Spot ETF decisions early in 2024. The question is how deep a retracement will we get and will the FOMC meeting play a part? According to CoinGlass data shows that there was an approximate liquidation of around $335 million of long positions over the last 12 hours. The amount of liquidations are represented below with Bitcoin leading the way followed by Ether. Source: CoinGlass/CoinDesk CRYPTO RESILIENCE A pullback should not be viewed in a negative light as the overall cloud which many though would hover over the Crypto sector cleared long ago. This is something I have previously discussed but has actually been pointed out in research of late as well. According to research released recently by Coinwire.com, 83% of Crypto mentions in op publications have been positive in 2023. This would explain the resilience of the industry in a time when it has faced a number of challenges. Other key takeaways from the CoinWire study revealed that over 65% of global crypt related Tweets have a positive sentiment. The United Kingdom takes the lead in this global cheer, with more than72%of crypto-related tweets from this region being positive. The US as well is a leader here with approximately 2 out of 3 Americans have a positive view of Crypto in 2023. This is one I admit surprised me given the FTX scandal, but I was once again forced to remember the Banking crisis earlier in the year. I guess the point m trying to make here is a selloff should not be accompanied by doom and gloom and do not get caught up in the FOMO of it all with the festive season ahead. The outlook for 2024 looks promising and I would keep that in mind if we do have a deep and aggressive pullback. CATHY WOOD’S ARK INVEST SELLS COINBASE SHARES ARK has been consistently selling Coinbase (COIN) shares over the past couple of weeks. ARK upped the ante in July selling 480,000 shares at a value of $50.5 million at the time until this past Friday when ARK offloaded a further 335,860 shares which would have been valued at $49.2 million at Coinbase’s closing price. A surprise to me given the positive outlook I have regarding Coinbase in 2024, but that’s a topic for another time. ARK however did the sale due to the target weighting it applies to its ETFs. The recent rally in the Coinbase share price has seen the weight of the shares exceed the limit of 10% imposed by ARK. The sale however failed to accomplish this, as things stand COIN accounts for some 13% of the Fintech Innovation ETF and +-11% of the Next Generation ETF. A further appreciation in the Coinbase price could see ARK effect further sales in the coming days and weeks and could be worth monitoring. READ MORE: HOW TO USE TWITTER FOR TRADERS BITCOIN PRICE OUTLOOK AND FINAL THOUGHTS From a technical standpoint BTCUSD failure to find acceptance above $45k was a sign that retest of the $40k level was inevitable. We have just fallen short of this level today but could still go on to tap that level, where the 20-day MA also rests just above the $40k mark. The support level at the $40k mark with a break lower brings support at the $37600 into focus with the 50-day MA resting at the $37400 mark. Any further drop will bring the support areas at 35600 and 35000 into play. A move higher from here will face immediate resistance at the $43000 handle before the psychological $45000 mark comes back into focus. The major resistance level at the $50000 mark looks tasty and achievable but there is a growing chance of a deeper retracement before a test of this level comes to fruition. Source: Kobeissi Letter Resistance levels: 43000 45000 47500 Support levels: 40000 37500 35000 BTCUSD Daily Chart, December 11, 2023. Source: TradingView, chart prepared by Zain Vawda https://www.dailyfx.com/news/bitcoin-btc-usd-price-forecast-eyes-on-40k-support-as-ark-sell-more-coinbase-coin-shares-20231211.html

2023-12-11 15:12

Gold (XAU/USD) Analysis Rejuvenated USD and stronger US yields weigh on gold at the start of the week Gold and USD extend inverse relationship after NFP Potential support levels considered ahead of US CPI and FOMC meeting The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library Rejuvenated USD and stronger US Yields Weigh on Gold to Start the Week Better-than-expected jobs data for November has cooled expectations of large-scale rate cuts in 2024 after the US unemployment rate declined from 3.9% to 3.7%. With the job market maintaining its relative strength, the Fed may have to maintain interest rates at restrictive levels for a little longer than markets anticipated. The ensuing downward revision in rate cut expectations has provided a breath of fresh air for the dollar and US yields which have both moved off their respective lows. However, with inflation moving in the right direction, tightening credit conditions (stricter requirements for credit applicants and lower demand for credit) and a rise in corporate bankruptcies, the overwhelming narrative across the market is that the Fed will have to cave in and cut rates in support of worsening market conditions. One of the major risk events next week – apart from the obvious central bank meetings – is the US CPI print. A softer-than-expected figure is likely to extend dovish expectations which could weigh further on the dollar, potentially providing a tailwind for gold prices. Gold and Dollar Extend Inverse Relationship After NFP The recent rebound in the dollar and reversal in gold can be seen via the chart below, where the uptick in gold has weighed on the precious metal. Gold prices and the US dollar tend to exhibit an inverse relationship over the longer-term and can be seen on the zoomed out daily chart. Source: TradingView, prepared by Richard Snow Potential Support Levels Considered Ahead of US CPI and FOMC Meeting Gold has started the week on the back foot, following on from where it ended last week. A second major pullback appears to be in the works since the October trough and now tests the $1985 level of support. It is no surprise that gold prices have eased after spiking to a new all-time-high early in December and the recent dollar lift has helped extend the sell-off. Gold is expected to be highly reactive to USD data this week with US CPI and the FOMC meeting the major catalysts. Throw in the ECB to that mix as EUR/USD makes up the majority of the US dollar index and you have a very busy week with a lot to consider. Should $1985 hold early on, resistance remains at $2010 followed by $2050. The main catalyst for a bullish continuation is if US CPI cools at a faster rate than anticipated. Gold (XAU/USD) Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/gold-pullback-extends-after-nfp-print-rejuvenated-the-dollar-us-yields-20231211.html