The U.S. Dollar had a mixed day, showing robust GDP growth of 4.90%, but Initial Jobless Claims slightly exceeded expectations at 210K. Gold markets are on edge with the upcoming PCE Index report fueling anticipation.
The U.S. Dollar had a relatively flat day, as GDP growth was robust at 4.90%, while Initial Jobless Claims came in below market expectations at 210K. Gold markets were cautious as anticipation built up ahead of the PCE report. The euro fell following the European Central Bank‘s decision to keep interest rates on hold, reflecting concerns about slowing economic progress in the eurozone. Crude oil prices retreated as tensions in the Middle East eased, although the market remains clouded by the prevailing negative global economic outlook. In the U.S., the technology sector came under pressure amid uncertainty over advertising growth and the performance of key companies such as Meta Platforms and Google. The Japanese yen experienced increased volatility as it broke through the 150 level, drawing attention to possible currency intervention.
Dollar Index
The U.S. Dollar had a relatively flat day, influenced by a mix of economic data. The greenback maintained its strength as the GDP jumped to 4.90%, beating expectations and signaling robust economic growth. However, on the negative side, US Initial Jobless Claims came in at 210K, slightly above market expectations.
The Dollar Index is trading higher and is currently testing resistance. However, the MACD is showing diminishing bullish momentum, while the RSI is at 58, indicating that the index may be entering overbought territory.
Resistance level: 106.70, 107.15.
Support: 105.60, 104.80.
XAU/USD
Gold markets took a wait-and-see approach as mixed economic data left investors in a pensive mood. Anticipation is high ahead of the inflation report, with the potential for significant market volatility following its release. Investors are approaching the event with a safety-first mindset, prepared for a range of outcomes.
Gold prices are trading higher after breaking above the previous resistance level. However, the MACD is showing diminishing bullish momentum, while the RSI is at 70, suggesting that the commodity may be entering overbought territory.
Resistance level: 2025.00, 2080.00.
Support: 1980.00, 1895.00.
EUR/USD
The euro took a hit after the European Central Bank decided to leave interest rates unchanged for the first time in over a year. The move was attributed to concerns of an economic contraction in the Eurozone, which could slow inflation. This follows last month’s rate hikes, with the European Central Bank keeping interest rates at 4%.
The EUR/USD is trading lower and is currently testing the support level. The MACD is showing increasing bearish momentum while the RSI is at 40, indicating that the pair may extend its losses as the RSI has dropped sharply from the overbought territory.
Resistance level: 1.0675, 1.0795.
Support level: 1.0530, 1.0450.
GBP/USD
Despite hitting a one-month low, the Pound has been trying to bounce back, driven by dip buying and a technical correction. However, the overall economic outlook in the UK remains pessimistic, with poor manufacturing data and concerns over the risk of stagflation due to high inflation.
The GBP/USD is trading higher after bouncing off the support level. The MACD is showing diminishing bearish momentum while the RSI is at 48, suggesting that the pair may extend its gains as the RSI has rebounded sharply from the oversold territory.
Resistance level: 1.2300, 1.2565.
Support: 1.2060, 1.1830.
Nasdaq
The U.S. stock market came under downward pressure, particularly in the tech sector, on concerns about slowing advertising growth. Meta Platforms (Facebook) fell more than 3% after signaling weaker advertising demand. This, along with concerns about Google’s performance, added to the uncertainty surrounding the outlook for the US technology sector. The market also had to contend with slightly higher US Treasury yields following several better-than-expected earnings reports.
The Nasdaq is trading lower after breaking below the previous support level. The MACD is showing increasing bearish momentum. However, the RSI is at 29, indicating that the index may enter the oversold territory.
Resistance level: 14610.00, 15780.00.
Support: 13855.00, 13115.00.
USD/JPY
The Japanese Yen experienced increased volatility as it broke through the key psychological level of 150. The market is now closely watching for possible currency intervention from the Bank of Japan. Amid rising inflation and currency depreciation, the Bank of Japan is expected to maintain its hawkish stance.
The USD/JPY is trading higher after breaking above the previous resistance level. However, the MACD is showing diminishing bullish momentum while the RSI is at 55, suggesting that the pair may see a technical correction as the RSI has dropped sharply from the overbought territory.
Resistance level: 151.45, 152.00.
Support: 149.95, 148.40.
AUD/USD
The Australian dollar bounced off the year’s lows on a technical correction. Market attention is focused on the possibility of another interest rate hike from the Reserve Bank of Australia in November, as Governor Michele Bullock noted that the CPI was higher than expected, but within the expected range.
AUD/USD is trading higher after bouncing off of support. The MACD is showing diminishing bearish momentum, while the RSI is at 53, suggesting that the pair may extend its gains as the RSI remains above its mid-line.
Resistance level: 0.6395, 0.6510.
Support: 0.6300, 0.6205.
CL Oil
Crude oil prices retreated on signs of easing conflict in the Middle East as world leaders stepped up efforts to prevent further escalation. However, the oil market remains clouded by uncertainty due to negative economic outlooks in the Eurozone and the UK. As a result, investors are keeping a close eye on the economic outlook and geopolitical tensions for trading cues.
Oil prices are trading lower and are currently testing the support level. The MACD is showing increasing bullish momentum, while the RSI is at 41, indicating that the commodity may experience a technical correction and move higher, as the RSI has rebounded sharply from the oversold territory.
