2023-11-30 19:23

OIL PRICE FORECAST: Oil Failed at the 200-Day MA as the Technical and Fundamental Factors Weighed on the Price. OPEC+ Announce 2 Million bpd Cuts for Q1 2024 but it Appears Markets Expected More. Will the Bulls Recover or is a Retest of $70 a Barrel on the Cards? To Learn More About Price Action, Chart Patterns and Moving Averages, Check out the DailyFX Education Section. Most Read: Oil Price Forecast: WTI Faces Technical Hurdles as OPEC+ Rumors Swirl Oil prices rose this morning coming within a whisker of the psychological $80 a barrel mark. However, the OPEC+ meeting which was supposed to inspire a break back above the $80 handle had the opposite effect with a selloff ensuing in the aftermath. OPEC+ VOLUNTARY CUTS AND BRAZIL TO JOIN The OPEC+ meeting today through up a host of challenges if sources are to be believed. There was a lot of differing views from sources as markets waited with bated breath for an announcement on potential cuts. The announcement finally came that an agreement had been reached for voluntary cuts of around 2 million barrels a day for Q1 next year. Saudi Arabia extending its voluntary output cuts as the virtual meeting today failed to find a solution. Eventually however members did agree to go along with voluntary cuts with Saudi, Kuwait, Russia, Algeria and Kazakhstan said cuts would be gradually unwound after Q1 of 2024. Some of the cuts announced by OPEC+ members were 42k barrels/day from Oman, Iraq 220k barrels/day, UAE 163k barrels/day and then of course the extended cuts by Saudi Arabia and Russia leaving the total around 2.19 million barrels per day. The last surprise that came out of the OPEC+ meeting was the invite to Brazil to join the group with the Brazilian Energy Minister saying he hoped to join by January. Another concern for oil producer and the US came from EIA data today which showed that Crude and Petroleum products supply fell in September to 20.09 million barrels per day which is the lowest since April. This could further fuel concerns of a global slowdown as we head into 2024. LOOKING AHEAD US Data lies ahead and could have an impact on Oil prices. Part of the decline today could be attributed to a stronger US Dollar and rising US yields which had an impact on risk appetite. Tomorrow, we have manufacturing PMI data as well as speeches by Fed Policymakers which get more interesting by the day. Today’s comments (at least to me) struck a more hawkish tone than we have heard over the past couple of days and could also in part explain the rise in the US Dollar. TECHNICAL OUTLOOK AND FINAL THOUGHTS From a technical perspective WTI failed to close above the 200-day MA today despite trading above the moving average for large parts of the day. As i mention in my article yesterday (see here), WTI did remain in a bearish structure with a break above the and daily candle close above the $78.06 swing high needed to confirm a shift in structure and put the bulls in control. As things stand there is a real chance that Oil could remain rangebound between the recent lows around the $73 mark and the $78 a barrel handle. We are seeing a death cross pattern complete today as well with the 50-day MA crossing below the 100-day MA which could embolden bears heading into the weekend. WTI Crude Oil Daily Chart – November 30, 2023 Source: TradingView Key Levels to Keep an Eye On: Support levels: 75.00 73.00 70.00 Resistance levels: 76.95 78.06 80 (psychological level) IG CLIENT SENTIMENT IG Client Sentiment data tells us that 86% of Traders are currently holding LONG positions, up from 82% yesterday. Given the contrarian view to client sentiment adopted here at DailyFX, does this mean we are destined to revisit recent lows? https://www.dailyfx.com/news/oil-price-forecast-wti-slips-as-opec-voluntary-cuts-fail-to-convince-20231130.html

2023-11-30 17:30

US DOLLAR FORECAST – EUR/USD, GBP/USD The U.S. dollar extends its recovery as U.S. yields push higher Powell’s speech on Friday will take center stage This article looks at key tech levels to watch on EUR/USD and GBP/USD Most Read: US Consumer Spending Eases but the US Dollar Index (DXY) Continues to Advance The U.S. dollar, as measured by the DXY index, extended its recovery on Thursday, boosted by a bounce in U.S. Treasury yields following remarks from San Francisco Federal Reserve President Mary Daly indicating that the FOMC is not yet considering slashing borrowing costs. Daly's forceful position, which clashes with the more cautious posture embraced by other colleagues, highlights a widening chasm between the doves and the hawks. UPCOMING MARKET EVENTS Unsure about the U.S. dollar's trend? Gain clarity with our Q4 forecast. Request your complimentary guide today! To address uncertainties regarding the broader central bank’s stance, traders should closely monitor Fed Chair Powell’s speech at Spelman College on Friday. This event might serve as a platform for the FOMC chief to provide clarification on the monetary policy outlook. Hawkish comments endorsing higher interest rates for longer are likely to exert upward pressure on U.S. yields, creating the right conditions for the U.S. dollar to prolong its nascent rebound. On the flip side, a lack of pushback on dovish market pricing ( many rate cuts for 2024 already discounted) could drag yields, weighing on the greenback. EUR/USD TECHNICAL ANALYSIS The EUR/USD fell for a second consecutive day on Thursday, with losses accelerating after the release of weaker-than-expected Eurozone inflation data for November. If the pullback gathers steam in the coming trading sessions, the lower boundary of a short-term ascending channel at 1.0890 may act as support, but the prospect of a drop towards 1.0840 cannot be ruled out if a breakdown unfolds. Conversely, if bulls regain control of the market and the exchange rate resumes its recent advance, the first ceiling to watch is positioned at 1.0960, which corresponds to the 61.8% Fib retracement of the July/October slump. On further strength, a revisit to November’s peak is probable, followed by a potential rally towards horizontal resistance at 1.1080. For a comprehensive assessment of the euro’s medium-term technical and fundamental outlook, request a free copy of our latest forecast! EUR/USD TECHNICAL CHART EUR/USD Chart Created Using TradingView GBP/USD TECHNICAL ANALYSIS GBP/USD also retreated on Thursday, but managed to remain above technical support in the 1.2590 region. This moderate pullback is unlikely to signal a shift towards a negative outlook; rather, it may represent a brief pause in the near-term uptrend. Upholding cable’s bullish outlook requires the pair to stay above 1.2590. If this floor holds, GBP/USD may soon resume its upward trek following a brief consolidation period, paving the way for a move towards 1.2720, the 61.8% Fib retracement of the July/October slide. Continued strength might direct attention to the 1.2800 handle. On the flip side, if losses intensify and sellers manage to drive prices below 1.2590, we might observe a drop toward both the 100-day simple moving average and 1.2460 in the case of sustained weakness. GBP/USD TECHNICAL CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-up-but-bearish-risks-grow-setups-on-eur-usd-gbp-usd-before-powell-20231130.html

2023-11-30 15:30

Japanese Yen (USD/JPY) Analysis and Charts USD/JPY ticks up as November bows out A BoJ official has cast doubt on any near-term monetary alteration The USD, meanwhile, has been boosted by stronger US growth data The Japanese Yen slipped a little against the United States Dollar on Thursday, with the possibility of tighter Japanese monetary policy undermined by recent commentary from an official at the Bank of Japan. The foreign exchange market has been cautiously bullish on the comparative outlooks for the two majors since mid-November. The prospect of lower US interest rates in the first half of next year has stripped the Dollar of a lot of support, and not only against the Yen. Meanwhile, the view that domestic Japanese inflation might have risen far enough to see the BoJ unwind its incredibly loose monetary policy stance has given the Yen a boost. However, Bank of Japan monetary policy board member Seiji Adachi said quite explicitly on Wednesday that Japan’s economy had yet to reach the stage at which an exit from current policy settings could be considered. “For now, it’s appropriate to patiently continue with monetary easing,” he reportedly said. Learn How to Trade USD/JPY with our Complimentary Guide While inflation has been clearly seen across the entire global economy, the durability of its impact on Japan has kept markets guessing as to what the BoJ might have planned. Japan’s economy has been wrestling with a lack of locally generated pricing power for many years now. And, as Mr. Adachi pointed out, it’s probably going to take more than a few months of stronger inflation data to convince policymakers that it’s back. The belief that the BoJ will act, albeit cautiously, to roll back some of its accommodation, remains quite strong in the foreign exchange market, but this latest commentary has certainly given traders and investors pause. If they start to feel that they’ve got too far ahead of the BoJ’s thinking, then the Yen could face some stronger headwinds, but it’s equally likely that Thursday’s modest weakness is explicable by some calendar-based position squaring as we head into the end of the month. So, a bit of caution is clearly warranted going into the next monetary policy decisions from the Federal Reserve and the Bank of Japan. They’re coming up on the 13th and 19th of December, respectively. Recent upgrades to overall US growth figures have also offered the Dollar some general support. USD/JPY Technical Analysis USD/JPY Daily Chart Compiled Using TradingView The Dollar is back at lows not seen since early September against the Japanese currency, but it is perhaps notable that despite some sustained weakness, even the first Fibonacci retracement of the long rise up to mid-November’s peaks from the lows of January has yet to face a serious challenge, although maybe one is coming shortly. It comes in at 146.183, less than a single Yen below current levels. Dollar bulls’ efforts to regain the uptrend channel in place since August 4 petered out with the falls seen on Monday, with the 149.54 region abandoned in that session now offering near-term resistance. That will need to be retaken if the year’s highs above 151.00 are to come back into the bulls’ sights. The Dollar is drifting toward levels at which its Relative Strength Index would suggest that it had been oversold but, with the RSI at 39, it’s not there yet. A reading of 30 or below would be unambiguous oversold territory. IG’s own sentiment indicator finds traders extremely bearish on the Dollar, to the tune of 74%. This may well favor at least a short-term contrarian play for a bounce. --By David Cottle for DailyFX https://www.dailyfx.com/news/japanese-yen-returns-some-gains-after-adachi-comments-suggest-no-boj-shift-20231130.html

2023-11-30 13:55

US Core PCE Key Points: Core PCE Price Index YoY(OCT) Actual 3.5% Vs 3.7% Previous. PCE Price Index YoY(OCT) Actual 3% Vs 3.4% Previous. The Data Today Will Only Further Fuel to Fire Regarding Rate Cuts in 2024. To Learn More AboutPrice Action,Chart PatternsandMoving Averages, Check out theDailyFX Education Section. MOST READ: Oil Price Forecast: WTI Faces Technical Hurdles as OPEC+ Rumors Swirl Core PCE prices MoM slowed in October following two successive months of 0.4% increases. The October print of 0.2%, in line with estimates was the weakest reading since July 2022. ThePCE price indexincreased less than 0.1 percent. Excluding food and energy, the PCE price index increased 0.2 percent. The annual rate cooled to 3% from 3.4%, a low level not seen since March 2021, matching forecasts. Meanwhile, annual core PCE inflation which excludes food and energy, slowed to 3.5% from 3.7%, a fresh low since mid-2021. The increase incurrent-dollar personal incomein October primarily reflected increases in personal income receipts on assets and compensation that were partly offset by a decrease in personal current transfer receipts. Source: US Bureau of Economic Analysis US ECONOMY AHEAD OF THE FOMC MEETING The recent batch of data releases continue to indicate a slowdown with the US showing similar signs despite the robust labor market and services inflation. Market participants have been buoyed by the recent batch of data increasing bets for rate cuts in 2024. Today's PCE data will likely add further fuel to that fire as the slowdown continues. Next week we have the NFP report which could further strengthen the case for the Federal Reserve heading into the December meeting. The question that will bug me if we do see a softer NFP print and sign that the labor market is cooling is whether the Fed will be prepared to finally signal that they are done with rate hikes. December promises to be an intriguing month and the US Dollar in particular will be interesting to watch. MARKET REACTION Following the data release the dollar index surprisingly strengthened as we have seen multiple USD pairs slide. This is interesting given the softness of the data and could be down to potential profit taking by USD sellers as well. The DXY is running into some technical hurdles that lie just ahead with the 200-day MA resting at the 103.59 mark. The overall structure of the DXY remains bearish until we see a daily candle close above the swing high around the 104.00 handle. Key Levels to Keep an Eye On: Support levels: 103.19 103.00 102.50 Resistance levels: 103.59 104.00 104.28 DXY Daily Chart- November 29, 2023 Source: TradingView, prepared by Zain Vawda https://www.dailyfx.com/news/us-consumer-spending-eases-but-the-us-dollar-index-dxy-continues-to-advance-20231130.html

2023-11-30 12:13

Gold (XAU/USD) Analysis After a hot growth print for Q3, gold appears more subdued but PCE may reignite the bull run Gold threatens to test all-time-high of $2081 should $2050 hold this week US exceptionalism at risk as economic fortunes sour in the US (sentiment and hard data) The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library Gold Takes a Breather Ahead of US PCE Data Markets continue to react to incoming data and are expected to be sensitive to further growth and inflation indicators as the expectation for interest rate cuts filters across markets. Yesterday, the second revision to US GDP for the third quarter surpassed the prior reading as well as consensus estimates – helping provide support for the US dollar. Better than expected growth data for Q3 contrasts what we are seeing unfolding in Q4. Activity, sentiment and growth data have all revealed a tendency to underwhelm, leading markets to price in accommodative interest rate cuts sooner than the Fed has indicated and at twice the magnitude too. Expectations of a lower Fed funds rate, releases steam from the elevated US dollar – presenting a discount for foreign buyers of the metal as gold is priced in US dollars. Gold Threatens to Test All-Time-High Should $2050 Hold This Week After Fed Governor Christopher Waller suggested rate cuts could emerge within the next 3-5 months the dollar selloff gained momentum, elevating gold. The resurgent move appears to have found immediate resistance at $2050 where prices have edged lower after US Q3 GDP appears to have outperformed the already impressive initial estimate of 4.9% growth (annualized). Support appears at $2010 but pullbacks have been shallow recently and a lower then anticipated PCE print could quickly send gold prices higher once again. Those eying up a potential bullish continuation would want to see the gold price hold above $2050 into the weekend. The RSI has entered and is appearing to recover from oversold territory – a potential headwind for an immediate bullish continuation. Gold Daily Chart Source: TradingView, prepared by Richard Snow The weekly chart helps to frame the recent rise and highlights the importance of the $2050 level. Gold Weekly Chart Source: TradingView, prepared by Richard Snow A number of drivers behind the gold price appear to be pulling in the same direction. Interest rate expectations see rate cuts ramping up into 2024, US yields and the dollar have both moved away from their relative peaks while gold maintains its safe haven appeal amidst the ongoing geopolitical conflict. Softer economic data has been observed across the US, from sentiment data to hard data like NFP, retail sales and GDP growth to name a few. The chart below shows the drop-off in general US data revealed by the Citi economic surprise index: Citi Economic Surprise Index Source: Refinitiv, prepared by Richard Snow https://www.dailyfx.com/news/gold-price-update-pullback-in-question-ahead-of-us-pce-data-20231130.html

2023-11-30 10:28

EUR/USD Forecast - Prices, Charts, and Analysis Euro Area Inflation drops sharply. ERU/USD remains trend-bound. Most Read: Euro (EUR) Forecast: EYR/USD and EUR/GBP Week Ahead Outlooks Inflation in the Euro Area continue to fall with the latest reading showing a showing downturn from October’s numbers. Core inflation fell by 0.6% to 3.6%, while headline inflation fell by 0.5% to 2.4%. Headline inflation is now at its lowest level since July 2021, while the core rate is at its lowest level since April 2022. Both readings can in below market expectations. Today’s inflation release will add to the recent growing sense that the European Central Bank will trim borrowing rates sooner than previously expected. The latest ECB rate expectations show the first 25 basis point rate cut at the April meeting with a total of 115 basis points of cuts priced in for 2024. EUR/USD slipped lower post-release but the pair remain within an upward channel that has held for the last two weeks. A break of the channel, around the 1.0900 level may see the pair slip lower with the 23.6% Fibonacci retracement level at 1.0864 the first level of support. EUR/USD Daily Price Chart IG Retail trader data shows 38.77% of traders are net-long with the ratio of traders short to long at 1.58 to 1.The number of traders net-long is 11.81% higher than yesterday and 1.89% lower than last week, while the number of traders net-short is 4.27% lower than yesterday and 9.09% higher than last week. All Charts Using TradingView What is your view on the EURO – 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/euro-area-inflation-falls-sharply-eur-usd-slips-on-heightened-ecb-rate-cuts-expectations-20231130.html