2023-12-07 19:00

OIL PRICE FORECAST: Oil Fails at the $70 Hurdle Before Sliding Further. President Putin Makes Rare Visit to Middle East as Saudi Arabia and Russia Reiterate Importance of OPEC+ Voluntary Cuts. Chinese Imports and Oil Demand from Refineries Falls. IG Client Sentiment Shows Traders are 87% Net-Long 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 struggled in attempts to reclaim the $70 a barrel handle as it faced renewed selling pressure on renewed demand concerns. Having said that WTI was up more than 1% and did trade briefly above the $70 mark. CHINESE IMPORTS INCREASE DEMAND CONCERNS This shouldn’t be a new topic or a surprise for those of you who have been following my pieces on Oil of late. Chinese Oil imports have been discussed in depth with my original articles hinting at a buildup/replenishment of stockpiles by Chinese authorities. Given the mixed recovery in China the Asian nation still managed to surpass its previous records in term of Oil imports. I had discussed the implications once the replenishment was complete and what impact a slowdown on imports from the World’s second largest economy. The month of November saw Oil imports fall 9.2% YoY in the first annual decline since April. There is also concern around slowing orders from independent refiners saw demand suffer. Given the ongoing concerns around the real estate and construction sectors ratings agency Moody’s put a downgrade warning on China’s credit rating. The Ratings Agency cited risks associated with the ongoing downsizing of the property sector. This if it continues into next year could hamper China’s recovery and also weigh on Oil demand. PRESIDENT PUTIN VISITS SAUDI ARABIA AND UAE. OPEC+ MEMBERS COMMITTED TO CUTS The OPEC+ meeting last week underwhelmed to say the least, with the voluntary cuts (begrudgingly agreed according to reports) failing to convince markets. This coupled with tensions in the Middle East saw Russian President Vladimir Putin make a rare trip to the Middle East. President Putin hasn’t traveled internationally since the war in Ukraine began but this week visited the UAE and Saudi Arabia. The two largest Oil exporters urged OPEC+ members to join an agreement on output cuts, the leaders citing the good of the global economy as a driving force for the move. Debatable or not the motives may be, however OPEC+ did get it right earlier in 2023 when they cut supply keeping Oil prices supported. It is no secret that the bloc wishes o keep Oil prices steady above the $80 a barrel mark. The meetings in the Middle East concluded with both sides stressing the importance of their cooperation as well as the need for all participating countries to join the OPEC+ agreement and keep Oil prices steady. The biggest member of OPEC excluded from the cuts is Iran, the economy of which has been under various U.S. sanctions since 1979 after the seizure of the U.S. embassy in Tehran. Iran is boosting production and hopes to reach output of 3.6 million bpd by March 20 next year. LOOKING AHEAD Looking to the rest of the week and US jobs data takes center stage tomorrow and has the potential to create a lot of volatility. This could have a knock-on effect on USD denominated Oil heading into a massive week of Central Bank meetings. TECHNICAL OUTLOOK AND FINAL THOUGHTS From a technical perspective WTI remains vulnerable below the $70 a barrel mark with support resting around the $67 handle. This of course is a key area of support where we had printed a triple bottom pattern in May and June before the explosive move to the upside began. A push to this level may face stiff buying pressure and could prove to be a bottom for Oil prices. Alternatively, a break back above the $70 a barrel mark immediate resistance rests at $72.15 and just above at the $73.06 handle. WTI Crude Oil Daily Chart – December 7, 2023 Source: TradingView Key Levels to Keep an Eye On: Support levels: 68.25 67.00 65.00 Resistance levels: 70.12 72.15 73.06 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-70-a-barrel-holds-firm-as-china-adds-to-demand-concerns-20231207.html

2023-12-07 17:05

GOLD PRICE FORECAST Gold prices lack directional conviction ahead of key U.S. jobs data November's nonfarm payrolls report may offer clues about the health of the economy and thus the Fed's monetary policy path This article looks at key price levels to watch on XAU/USD in the coming trading sessions Most Read: Crude Oil Forecast - Prices in Freefall as Pivotal Technical Support Caves In Gold prices (XAU/USD) moved with limited conviction on Thursday, swinging between small gains and losses as investors avoided taking large directional bets on the asset for fear of getting caught on the wrong side of the trade ahead of key U.S. jobs data before the weekend. The November nonfarm payrolls report, due out Friday morning, could provide valuable information on the health of the labor market, helping to clarify the Fed's monetary policy outlook. For this reason, it could be a source of volatility for major financial assets. In terms of estimates, U.S. employers are forecast to have added 170,000 workers last month, resulting in an unchanged unemployment rate of 3.9%. For its part, average hourly earnings are seen rising 0.3% m-o-m, with the related yearly reading easing to 4.0% from 4.1% previously. 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! While gold retains a constructive outlook from a fundamental standpoint, many traders want more information about the state of the U.S. economy before reengaging bullish positions, especially after getting burned badly earlier in the week when a promising breakout turned into a big sell-off. Focusing on possible scenarios, if nonfarm payrolls surprise to the upside by a wide margin, monetary policy easing wagers for 2024 could be scaled back rapidly, putting upward pressure on Treasury yields and the U.S. dollar. This could be detrimental to precious metals. Conversely, if NPF figures disappoint in a material way, many investors could shift back to viewing a recession as their baseline case, reinforcing dovish interest rate prospects for the coming year. Against this backdrop, yields and the greenback could head lower, boosting gold prices in the process. Acquire the knowledge needed for maintaining trading consistency. Grab your "How to Trade Gold" guide for invaluable insights and tips! GOLD PRICES TECHNICAL ANALYSIS Gold (XAU/USD) broke its previous record, briefly reaching an all-time high earlier in the week, only to swiftly plummet, suggesting that the long-await bullish breakout was a fakeout. Despite waning upward momentum, bullion retains a positive technical profile, so the path of least resistance remains to the upside. With that in mind, if the precious metal resumes its ascent, the first hurdle to overcome is positioned at $2,050, followed by $2,070/$2,075. Looking higher, attention gravitates towards $2,150. On the other hand, if losses escalate in the coming days and weeks, support rests near $2,010. This technical zone could act as a floor in case of further weakness, but a drop below it may be the start of a bigger bearish move, with the next downside target at $1,990. GOLD PRICE TECHNICAL CHART Gold Price Chart Created Using TradingView https://www.dailyfx.com/news/gold-prices-on-edge-ahead-of-key-us-jobs-data-trade-setups-on-xau-usd-20231207.html

2023-12-07 14:25

RAND TALKING POINTS & ANALYSIS Recovering South African current account encouraging for ZAR. NFP to determine short-term guidance. USD/ZAR bears eye rising wedge breakout. Macro-economic fundamentals underpin almost all markets in the global economy via growth, inflation and employment – Get you FREE guide now! USD/ZAR FUNDAMENTAL BACKDROP Later today, US consumer credit change close out the trading session and could provide some short-term volatility. TECHNICAL ANALYSIS USD/ZAR DAILY CHART Chart prepared by Warren Venketas, TradingView The daily USD/ZAR chart now looks to approach the apex of the rising wedge formation (dashed black line) coinciding with wedge support. A confirmation candle close below could spark further downside but I would like to see a close below the 200-day moving average (blue) as well. The key inflection zone around the 18.7759 level has proved to be a potential turning point in the past which supports the indecision by traders to favor any particular directional bias as shown by the Relative Strength Index (RSI). In summary, an NFP beat could negate the rising wedge while a significant miss could bring the 18.5000 psychological support handle into consideration once again. Resistance levels: 19.0000 18.7759/50-day MA (yellow) Support levels: Wedge support/200-day MA (blue) 18.5000 https://www.dailyfx.com/news/forex-zar-price-update-rand-capitalizes-on-weaker-usd-wv-20231207.html

2023-12-07 12:00

Article by IG Chief Market Analyst Chris Beauchamp Dow Jones, Nasdaq 100, CAC 40 Analysis and Charts Dow edges off highs The index continues to trim the gains made last week, with Wednesday’s session seeing its largest drop in a month as energy stocks fell sharply thanks to fresh declines in oil prices. However, for the moment a more sustained pullback has yet to develop. Upward momentum has faded, but the price remains above the August highs. Additional gainscontinue to target 36,570, and then on to the record highs at 36,954. Dow Jones Daily Chart Nasdaq 100 fights to establish a direction This week has seen a see-saw movement in the index; Monday’s losses were reversed by Tuesday’s gains, which were then countered by Wednesday’s drop. The price is hovering above 15,760 support, and a fresh drop below this might then see the price head back toward the 50-day simple moving average. Buyers will be looking for a close back above 16,100 to suggest that a new leg higher has begun. Nasdaq 100 Daily Chart CAC40 struggles around trendline resistance The price briefly pushed above trendline resistance from the April high yesterday, but after the huge gains since late October, it is perhaps not surprising that it was unable to hold above the trendline. Like several other indices, the price shows no sign of slowing down or reversing – the consolidation around the 200-day SMA in mid-November seems to have been sufficient for the time being. A close back below 7350 might signal a pullback is beginning, while a close above post-April trendline resistance would then see the price target the late July high at 7526. CAC40 Daily Chart https://www.dailyfx.com/news/dow-edges-lower-while-nasdaq-100-and-cac40-mixed-20231207.html

2023-12-07 10:45

EU GDP and Euro Analysis EU GDP growth rate unchanged compared to Q2 (-0.1%) and stagnant vs Q3 2022 (0%) EUR/USD heads lower as the euro struggles to halt declines across G7 currencies German CPI and US non-farm payroll data to end the week on Friday Growth turned negative in Q3 when compared to Q2, highlighting the worsening trajectory of the European economy. However, the year-on-year comparison managed to avoid a contraction but did get revised lower from an anaemic 0.1% gain to end flat at 0%. EU GDP Stagnant Growth Sets in for Europe The chart below depicts the state of affairs in Europe as the global growth slowdown really takes hold. Europe has witnessed fast declines in the manufacturing sector – led by massive declines from Europe’s manufacturing giant, Germany – and woeful sentiment regarding economic prospects which have only started to pick up again. Markets now price in a greater likelihood that the ECB will be forced to cut interest rates by a larger amount next year, something that has weighed heavily in the euro in the last two weeks. Inflation in Europe is showing great progress, so much so that PPI is currently negative (deflationary), and typically lags traditional measures of inflation like CPI by around 6 months. EU GDP Growth Percentage (Year-on-year) Source: Refinitiv, prepared by Richard Snow Immediate Market Reaction The immediate reaction in EUR/USD saw prices head lower but only after building up ahead of the data release. EUR/USD 5-minute chart Source: TradingView, prepared by Richard Snow The daily chart shows a continuation of the bearish directional move which has crossed below the 200 SMA and now tests the 38.2% Fibonacci retracement of the late 2022 decline. The pair may find temporary support ahead of German inflation data and NFP tomorrow. Softer German inflation could see even further euro softening ahead of NFP EUR/USD Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/eu-breaking-news-eu-gdp-revised-lower-confirming-stagnant-growth-20231207.html

2023-12-07 09:30

Japanese Yen Prices, Charts, and Analysis All monetary policy levers remain unchanged, for now. USD/JPY prints a fresh three-month low. Learn How to Trade USD/JPY with our Complimentary Guide The Japanese Yen is strengthening against a range of currencies today after recent Bank of Japan commentary suggested that the central bank may be looking at various ways of ending its ultra-loose monetary policy. According to BoJ deputy governor Ryozo Himino, ending the current ultra-loose monetary policy would not harm the economy, while governor Kazuo Ueda noted that the central bank has not decided which interest rate to look at it when the BoJ finally ends their negative interest rate policy. This faintly hawkish messaging was countered by governor Ueda adding that Japan’s economy is still struggling and will continue to do so in 2024. USD/JPY reacted to today’s comments by sliding to a fresh three-month low. Looking to the months ahead, if the US starts to reduce interest rates – 125 bp of rate cuts are forecast by the Fed in 2024 – and the Bank of Japan leaves policy unchanged - or even starts to tighten policy - the rate differential between the two currencies will narrow, pushing USD/JPY lower. After posting a multi-decade high of 151.91 on November 13th, USD/JPY has moved lower as fears of central bank intervention capped any further upside. Today’s sharp turn lower now sees USD/JPY trade around 145.30 and further losses cannot be discounted. The pair trades below the 20- and 50-day simple moving averages and a break below the 145 level would bring into focus the 200-day sma at 142.26. USD/JPY Daily Price Chart – December 7, 2023 Retail trader data shows 27.40% of traders are net-long with the ratio of traders short to long at 2.65 to 1.The number of traders net-long is 1.71% lower than yesterday and 0.43% lower than last week, while the number of traders net-short is 5.47% lower than yesterday and 11.03% lower than last week. What is your view on the Japanese Yen – 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/japanese-yen-latest-usd-jpy-posts-a-fresh-three-month-low-on-boj-talk-20231207.html