The post Ex-Dividend 03/12/2024 first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 2 December 2024

What happened in the Asia session?

During the Asian session, the U.S. dollar rebounded from recent lows against the yen and British pound, influenced by President-elect Donald Trump’s comments discouraging BRICS nations from seeking alternatives to the dollar. 

The dollar rose 0.5% to 150.53 yen and strengthened against the euro and pound. Asian equities experienced gains, with Hong Kong’s Hang Seng up 0.9% and mainland China’s blue-chip index increasing by 0.6%, bolstered by strong Chinese manufacturing data. 

Japan’s Nikkei saw a slight decline of 0.3%, affected by a drop in Fast Retailing shares. 

Overall, the session was marked by a stronger dollar and positive movements in Asian stock markets.

What does it mean for the Europe & US sessions?

The Asian session, saw the U.S. dollar strengthen against major currencies, notably rising 0.5% to 150.53 yen, following President-elect Donald Trump’s warning to BRICS nations against seeking alternatives to the dollar. 

This development suggests potential volatility in the upcoming European and U.S. sessions, as markets react to geopolitical tensions and U.S. interest rate expectations. European currencies may face pressure, especially the euro, amid concerns over the French government’s stability and anticipated European Central Bank rate cuts. 

The Dollar Index (DXY)

Key news events today

ISM Manufacturing PMI (3:00 pm GMT)

What can we expect from DXY today?

The U.S. Dollar Index (DXY) has recently declined, closing at 105.78 on November 29, 2024, down 0.36% from the previous session. This movement reflects market anticipation of potential Federal Reserve interest rate cuts amid signs of economic slowdown.

The Institute for Supply Management (ISM) is scheduled to release the Manufacturing Purchasing Managers’ Index (PMI) today at 3:00 pm GMT. The previous PMI reading was 46.5, indicating contraction in the manufacturing sector. 

A PMI below 50 suggests continued contraction, which could reinforce expectations of Fed rate cuts, potentially exerting further downward pressure on the DXY. Conversely, a PMI above 50 would indicate expansion, possibly stabilizing or boosting the index.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to lower the Federal Funds Rate target range by 25 basis points to 4.50% to 4.75% on 7th November.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance.
• The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while labour market conditions have generally eased, and the unemployment rate has moved up but remains low.
• Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 17 to 18 December 2024.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Key news events today

ISM Manufacturing PMI (3:00 pm GMT)

What can we expect from Gold today?

Gold prices have been on an upward trend in 2024, driven by geopolitical tensions and economic uncertainties. Analysts predict that gold could reach $3,000 per ounce by mid-2025, supported by anticipated U.S. interest rate cuts and strong demand. 

The upcoming ISM Manufacturing PMI release could impact gold prices; a weaker PMI may lead to a softer dollar, potentially boosting gold, while a stronger PMI could have the opposite effect

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

Without major news events, AUD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.6479

Resistance: 0.6540

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35% on 5th November, marking the eighth consecutive pause.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but the forecasts published in today’s Statement on Monetary Policy (SMP) do not see inflation returning sustainably to the midpoint of the target until 2026.
• Headline inflation was 2.8% over the year to the September quarter, down from 3.8% over the year to the June quarter; this was as expected due to declines in fuel and electricity prices in the September quarter.
• However, this decline reflects a temporary cost of living relief; abstracting from these effects, underlying inflation (as represented by the trimmed mean) was 3.5% over the year to the September quarter and is still some way from the 2.5% midpoint of the inflation target.
• Growth in output has been weak as past declines in real disposable incomes and the ongoing effect of restrictive financial conditions continue to weigh on household consumption, particularly discretionary consumption.
• However, growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, has remained more resilient.
• A range of indicators suggest that labour market conditions remain tight, and while conditions have been easing gradually, some indicators have recently stabilised.
• Employment grew strongly over the three months to September, by an average of 0.4% per month but the unemployment rate was 4.1% in September, up from the trough of 3.5% in late 2022.
• While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high while the November SMP forecasts suggest that it will be some time yet before inflation is sustainably in the target range and approaching the midpoint.
• This reinforces the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out.
• Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range and it will continue to rely upon the data and the evolving assessment of risks to guide its decisions.
• Next meeting is on 10 December 2024.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Without major news events, NZD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.5867

Resistance: 0.5935

Central Bank Notes:

• The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
• The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
• Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
• The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
• High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
• The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
• Next meeting is on 27 November 2024.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

Without major news events, JPY’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 147.18

Resistance: 151.51

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 31st October, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) is likely to be at around 2.5% for fiscal 2024 and then be at around 2% for fiscal 2025 and 2026.
• While the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices are expected to wane, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• Comparing the projections with those presented in the previous Outlook for Economic Activity and Prices (Outlook Report), the projected real GDP growth rates are more or less unchanged. The projected year-on-year rate of increase in the CPI (all items less fresh food) for fiscal 2025 is somewhat lower due to factors such as the recent decline in crude oil and other resource prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

Without major news events, EUR’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.0272

Resistance: 1.0607

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17th October to mark the second successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.40%, 3.65% and 3.25% respectively.
• The incoming information on inflation shows that the disinflationary process is well on track while the inflation outlook is also affected by recent downside surprises in indicators of economic activity.
• Inflation is expected to rise in the coming months, before declining to target in the course of next year. Domestic inflation remains high, as wages are still rising at an elevated pace. At the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bearish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Without major news events, CHF’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.8729

Resistance: 0.8990

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
• Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
• Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
• The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
• Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
• However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bullish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Without major news events, GBP’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.2392

Resistance: 1.2854

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to reduce the Bank Rate by 25 basis points, to 4.75% on 7th November 2024 – one member preferred to maintain the Bank rate at 5.0%.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024.
• Twelve-month CPI inflation fell to 1.7% in September but is expected to increase to around 2.5% by the end of the year as weakness in energy prices falls out of the annual comparison; services consumer price inflation has declined to 4.9%.
• CPI inflation is expected to increase to around 2.75% by the second half of 2025 as weakness in energy prices falls out of the annual comparison, revealing more clearly the continuing persistence of domestic inflationary pressures.
• The MPC’s latest projections for activity and inflation are also set out in the accompanying November Report; this forecast is based on the second case where CPI inflation is projected to fall back to around the 2% target in the medium term as a margin of slack emerges later in the forecast period that acts against second-round effects in domestic prices and wages.
• GDP had grown by 0.5% in 2024 Q2, 0.2% weaker than had been expected in the August Report, and 0.1% weaker than the earlier outturn had indicated at the time of the MPC’s previous meeting. Through the second half of 2024, GDP was projected to grow at a somewhat slower rate than in Q2 – headline GDP growth is expected to fall back to its recent underlying pace of around 0.25% per quarter over the second half of this year.
• The combined effects of the measures announced in Autumn Budget 2024 are provisionally expected to boost the level of GDP by around 0.75% at their peak in a year’s time, relative to the August projections, while the Budget is provisionally expected to boost CPI inflation by just under 0.5% at the peak.
• Annual private sector regular average weekly earnings growth has continued to fall but remained elevated at 4.8% in the three months to August; the MPC judges that the labour market continues to loosen, although it appears relatively tight by historical standards.
• Based on the evolving evidence, a gradual approach to removing policy restraint remains appropriate but monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
• The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Medium Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Without major news events, CAD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.3948

Resistance: 1.4263

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 50 basis points bringing it down to 3.75% while continuing its policy of balance sheet normalization on 23rd October; this marked the fourth consecutive meeting where rates were reduced.
• Canada’s economy grew at around 2% in the first half of the year and growth of 1.75% is expected in the second half; consumption has continued to grow but is declining on a per person basis while exports have been boosted by the opening of the Trans Mountain Expansion pipeline.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.3% in 2026 – as the economy strengthens, excess supply is gradually absorbed.
• The labour market remains soft with unemployment at 6.5% in September while wage growth remains elevated relative to productivity growth. Overall, the economy continues to be in excess supply.
• Headline CPI has declined significantly from 2.7% in June to 1.6% in September while shelter costs inflation remains elevated but has begun to ease; the preferred measures of core inflation are now below 2.5%.
• Excess supply elsewhere in the economy has reduced inflation in the prices of many goods and services while the drop in global oil prices has led to lower gasoline prices – these factors have all combined to bring inflation down.
• The Bank expects inflation to remain close to the target over the projection horizon, with the upward and downward pressures on inflation roughly balancing out; the upward pressure from shelter and other services gradually diminishes, and the downward pressure on inflation recedes as excess supply in the economy is absorbed.
• With inflation now back around the 2% target, the Governing Council decided to reduce the policy rate by 50 basis points to support economic growth and keep inflation close to the middle of the 1% to 3% range.
• If the economy evolves broadly in line with the latest forecast, further reduction of the policy rate can be expected but the timing and pace of additional reductions in the policy rate will be guided by incoming information and assessment of its implications for the inflation outlook.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• Next meeting is on 11 December 2024.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

With no major news events today, oil prices may remain relatively stable, driven by technical factors and market sentiment – the support and resistance levels for today.

Support: 66.48

Resistance: 72.78

Next 24 Hours Bias

Medium Bullish

The post IC Markets Europe Fundamental Forecast | 2 December 2024 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei up 1.08%, Shanghai Composite up 1.24%, Hang Seng up 0.5% ASX up 0.14%
• Commodities : Gold at $2647.35 (-1.24%), Silver at $30.19 (-1.68%), Brent Oil at $72.4 (0.6%), WTI Oil at $68.27 (0.69%)
• Rates : US 10-year yield at 4.224, UK 10-year yield at 4.244, Germany 10-year yield at 2.087

News & Data:

• (CAD) GDP m/m 0.1% vs 0.3% expected

Markets Update:

Asia-Pacific markets opened slightly higher on Monday, marking the start of a data-heavy week with investors closely monitoring economic reports from Japan, South Korea, and China. Over the weekend, China’s official manufacturing PMI for November rose to 50.3, its highest since April, exceeding the 50.2 forecast by Reuters. This marked an improvement from October’s 50.1. Meanwhile, non-manufacturing PMI slipped to 50.0, and composite PMI remained steady at 50.8, signaling marginal expansion.

S&P Global’s manufacturing PMI data for Asia, including China’s Caixin survey, will be released later on Monday. In Australia, October’s retail sales saw a robust 3.4% year-on-year increase, the fastest since May 2023. Indonesia is set to reveal its November inflation figures by the end of the day.

South Korea’s Kospi traded near flat, while the Kosdaq inched up 0.13%. Preliminary trade data showed South Korea’s exports grew just 1.4% year-on-year in November, missing the 2.8% forecast and slowing sharply from October’s 4.6% rise. Japan’s Nikkei 225 rose slightly, and the Topix climbed 0.68%. In China, the CSI 300 edged up 0.26%, while Hong Kong’s Hang Seng gained 0.21%, bolstered by accelerated growth in China’s new home prices.

In the U.S., the Dow Jones, S&P 500, and Nasdaq hit new peaks on Friday, capping their best month of 2024. Chip stocks surged after reports of softer-than-expected U.S. export restrictions on semiconductor equipment, with Nvidia and Lam Research gaining over 2% and 3%, respectively.

Upcoming Events: 

• 02:30 PM GMT – CAD Manufacturing PMI
• 03:00 PM GMT – USD Final Manufacturing PMI
• 03:00 PM GMT – USD ISM Manufacturing PMI

The post Monday 2nd December 2024: Asia-Pacific Markets Rise as Economic Data Unfolds first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 104.65
Supporting reasons: Identified as a pullback support close to the 38.2% Fibonacci retracement, , indicating a potential area where buying interests could pick up to stage a rebound

1st support: 102.05
Supporting reasons: Identified as a pullback support that aligns with the 78.6 % Fibonacci retracement, indicating a potential level where price could find support once more.

1st resistance: 108.62
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

EUR/USD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 1.0607

Supporting reasons: Identified as an overlap resistance close to 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 1.0725

Supporting reasons: Identified as a swing low support, indicating a potential level where price could find support once more.

1st resistance: 1.0782
Supporting reasons: Identified as a pullback resistance close to 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 162.24

Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressures could intensify.

1st support: 157.05

Supporting reasons: Identified as a pullback support, indicating a potential level where price could find support once more.

1st resistance: 166.59
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

EUR/GBP:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 0.8359

Supporting reasons: Identified as a multi-swing high resistance, indicating a potential area where selling pressures could intensify.

1st support: 0.8267

Supporting reasons: Identified as a swing low support, indicating a potential level where price could find support once more.

1st resistance: 0.8445
Supporting reasons: Identified as a multi-swing high resistance, indicating a potential area that could halt any further upward movement.

GBP/USD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 1.2854

Supporting reasons: Identified as a pullback resistance close to 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 1.2379

Supporting reasons: Identified as an overlap support, indicating a potential level where price could find support once more.

1st resistance:  1.3039
Supporting reasons: Identified as a pullback resistance close to 61.8 Fibonacci retracement, indicating a potential area that could halt any further upward movement.

GBP/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 189.70
Supporting reasons: Identified as a pullback support close to the 61.8%  Fibonacci retracement, , indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 184.44
Supporting reasons: Identified as an overlap support, indicating a key level where price could find support once more.

1st resistance: 196.00
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

USD/CHF:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 0.8729
Supporting reasons: Identified as a pullback support close to the 38.2% Fibonacci retracement, , indicating a potential area where buying interests could pick up to stage a rebound

1st support: 0.8525
Supporting reasons: Identified as a pullback support close to 78.6 Fibonacci retracement, indicating a potential level where price could find support once more.

1st resistance: 0.8990
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

USD/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 151.51

Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressures could intensify.

1st support: 147.18
Supporting reasons: Identified asa pullback support, indicating a potential level where price could find support once again.

1st resistance: 154.16
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

USD/CAD:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 1.3948
Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound

1st support: 1.3649
Supporting reasons: Identified as pullback support, indicating a key level where price could find support once more.

1st resistance: 1.4263
Supporting reasons: Identified as a swing high resistance close to 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 0.6504

Supporting reasons: Identified as an overlap resistance close to 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 0.6397
Supporting reasons: Identified as a swing-low support, suggesting a key support area where price could find support once again.

1st resistance: 0.6647
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 0.5935

Supporting reasons: Identified as an overlap resistance close to 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 0.5831
Supporting reasons: Identified as a swing low support, suggesting a key support area where price could find support.

1st resistance: 0.6027
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 44,988.25

Supporting reasons: Identified as a swing high resistance, indicating a potential area where selling pressures could intensify.

1st support: 43,331.82

Supporting reasons: Identified as a pullback support, indicating a potential level where price could find support.

1st resistance: 45,568.36

Supporting reasons: Aligns with the 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 19,584.01

Supporting reasons: Identified as a swing high resistance, indicating a potential area where selling pressures could intensify.

1st support: 18,989.06

Supporting reasons: Identified as an overlap support, indicating a key level where price could find support once more.

1st resistance: 20,209.47
Supporting reasons: Identified as a swing-high resistance close to 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 6,026.70

Supporting reasons: Identified as a swing high resistance, indicating a potential area where selling pressures could intensify.

1st support: 5,874.05

Supporting reasons: Identified as an overlap support, indicating a potential level where price could find support again.

1st resistance: 6,148.32
Supporting reasons: Aligns with 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Neutral
Overall momentum of the chart: Bullish

Price could potentially make fluctuate between the 1st resistance and 1st support level.

1st support: 91,786.12
Supporting reasons: Identified as an overlap support that aligns with the 23.6% Fibonacci retracement, indicating a potential level where price could find support.

1st resistance: 99,542.94
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 3,342.10
Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound

1st support: 2,819.17
Supporting reasons: Identified as a pullback support, indicating a potential level where price could find support once again

1st resistance: 4,037.36
Supporting reasons:  Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 72.99

Supporting reasons: Identified as an overlap resistance that aligns with a 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support:  66.55
Supporting reasons: Identified as a swing-low support, indicating a key level where price could find support once again.

1st resistance: 78.09
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 2672.86

Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 2530.09

Supporting reasons: Identified as an overlap support, indicating a potential level where price could find support.

1st resistance: 2789.67
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

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The post Monday 2nd December 2024: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 2 December 2024

What happened in the U.S. session?

On November 29, during the U.S. trading session, the market exhibited significant movements:

Japanese Yen (JPY): The yen appreciated to a six-week high against the U.S. dollar, driven by Tokyo’s core consumer price index rising 2.2% year-over-year in November, surpassing expectations and fueling speculation of a potential Bank of Japan interest rate hike in December. 

U.S. Dollar (USD): The dollar weakened against major currencies, including the British pound, euro, and New Zealand dollar, influenced by reduced trading activity due to the U.S. Thanksgiving holiday and easing concerns over potential tariffs announced by President-elect Donald Trump. 

Euro (EUR): The euro strengthened, reaching multi-week highs against the dollar. However, concerns over the eurozone economy and potential European Central Bank rate cuts persisted, maintaining a cautious outlook. 

British Pound (GBP): The pound rose to its strongest level since mid-November against the dollar, supported by the dollar’s overall weakness. Nonetheless, political uncertainties within the UK continued to influence its performance. 

What does it mean for the Asia Session?

The U.S. dollar’s recent depreciation, influenced by expectations of Federal Reserve rate cuts due to a weakening economy, may lead to increased volatility in the Asian session. 

The Japanese yen has strengthened, reaching a six-week high against the dollar, driven by higher-than-expected inflation in Tokyo and speculation of a potential Bank of Japan interest rate hike. 

This appreciation could impact export-oriented Asian economies by making Japanese goods more expensive, potentially affecting trade balances.

 Additionally, U.S. President-elect Donald Trump’s warning of imposing 100% tariffs on BRICS nations if they pursue currency initiatives to undermine the dollar adds uncertainty, potentially affecting emerging Asian markets. 

The Dollar Index (DXY)

Key news events today

ISM Manufacturing PMI (3:00 pm GMT)

What can we expect from DXY today?

The U.S. Dollar Index (DXY) has recently declined, closing at 105.78 on November 29, 2024, down 0.36% from the previous session. This movement reflects market anticipation of potential Federal Reserve interest rate cuts amid signs of economic slowdown.

The Institute for Supply Management (ISM) is scheduled to release the Manufacturing Purchasing Managers’ Index (PMI) today at 3:00 pm GMT. The previous PMI reading was 46.5, indicating contraction in the manufacturing sector. 

A PMI below 50 suggests continued contraction, which could reinforce expectations of Fed rate cuts, potentially exerting further downward pressure on the DXY. Conversely, a PMI above 50 would indicate expansion, possibly stabilizing or boosting the index.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to lower the Federal Funds Rate target range by 25 basis points to 4.50% to 4.75% on 7th November.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance.
• The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while labour market conditions have generally eased, and the unemployment rate has moved up but remains low.
• Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 17 to 18 December 2024.

Next 24 Hours Bias

Weak Bullish

Gold (XAU)

Key news events today

ISM Manufacturing PMI (3:00 pm GMT)

What can we expect from Gold today?

Gold prices have been on an upward trend in 2024, driven by geopolitical tensions and economic uncertainties. Analysts predict that gold could reach $3,000 per ounce by mid-2025, supported by anticipated U.S. interest rate cuts and strong demand. 

The upcoming ISM Manufacturing PMI release could impact gold prices; a weaker PMI may lead to a softer dollar, potentially boosting gold, while a stronger PMI could have the opposite effect

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

Without major news events, AUD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.6479

Resistance: 0.6540

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35% on 5th November, marking the eighth consecutive pause.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but the forecasts published in today’s Statement on Monetary Policy (SMP) do not see inflation returning sustainably to the midpoint of the target until 2026.
• Headline inflation was 2.8% over the year to the September quarter, down from 3.8% over the year to the June quarter; this was as expected due to declines in fuel and electricity prices in the September quarter.
• However, this decline reflects a temporary cost of living relief; abstracting from these effects, underlying inflation (as represented by the trimmed mean) was 3.5% over the year to the September quarter and is still some way from the 2.5% midpoint of the inflation target.
• Growth in output has been weak as past declines in real disposable incomes and the ongoing effect of restrictive financial conditions continue to weigh on household consumption, particularly discretionary consumption.
• However, growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, has remained more resilient.
• A range of indicators suggest that labour market conditions remain tight, and while conditions have been easing gradually, some indicators have recently stabilised.
• Employment grew strongly over the three months to September, by an average of 0.4% per month but the unemployment rate was 4.1% in September, up from the trough of 3.5% in late 2022.
• While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high while the November SMP forecasts suggest that it will be some time yet before inflation is sustainably in the target range and approaching the midpoint.
• This reinforces the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out.
• Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range and it will continue to rely upon the data and the evolving assessment of risks to guide its decisions.
• Next meeting is on 10 December 2024.

Next 24 Hours Bias

Weak Bearish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Without major news events, NZD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.5832

Resistance: 0.5935

Central Bank Notes:

• The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
• The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
• Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
• The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
• High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
• The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
• Next meeting is on 27 November 2024.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

Without major news events, JPY’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 147.18

Resistance: 151.51

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 31st October, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) is likely to be at around 2.5% for fiscal 2024 and then be at around 2% for fiscal 2025 and 2026.
• While the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices are expected to wane, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• Comparing the projections with those presented in the previous Outlook for Economic Activity and Prices (Outlook Report), the projected real GDP growth rates are more or less unchanged. The projected year-on-year rate of increase in the CPI (all items less fresh food) for fiscal 2025 is somewhat lower due to factors such as the recent decline in crude oil and other resource prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

Without major news events, EUR’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.0272

Resistance: 1.0607

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17th October to mark the second successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.40%, 3.65% and 3.25% respectively.
• The incoming information on inflation shows that the disinflationary process is well on track while the inflation outlook is also affected by recent downside surprises in indicators of economic activity.
• Inflation is expected to rise in the coming months, before declining to target in the course of next year. Domestic inflation remains high, as wages are still rising at an elevated pace. At the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bearish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Without major news events, CHF’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.8729

Resistance: 0.8990

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
• Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
• Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
• The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
• Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
• However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bullish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Without major news events, GBP’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.2392

Resistance: 1.2854

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to reduce the Bank Rate by 25 basis points, to 4.75% on 7th November 2024 – one member preferred to maintain the Bank rate at 5.0%.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024.
• Twelve-month CPI inflation fell to 1.7% in September but is expected to increase to around 2.5% by the end of the year as weakness in energy prices falls out of the annual comparison; services consumer price inflation has declined to 4.9%.
• CPI inflation is expected to increase to around 2.75% by the second half of 2025 as weakness in energy prices falls out of the annual comparison, revealing more clearly the continuing persistence of domestic inflationary pressures.
• The MPC’s latest projections for activity and inflation are also set out in the accompanying November Report; this forecast is based on the second case where CPI inflation is projected to fall back to around the 2% target in the medium term as a margin of slack emerges later in the forecast period that acts against second-round effects in domestic prices and wages.
• GDP had grown by 0.5% in 2024 Q2, 0.2% weaker than had been expected in the August Report, and 0.1% weaker than the earlier outturn had indicated at the time of the MPC’s previous meeting. Through the second half of 2024, GDP was projected to grow at a somewhat slower rate than in Q2 – headline GDP growth is expected to fall back to its recent underlying pace of around 0.25% per quarter over the second half of this year.
• The combined effects of the measures announced in Autumn Budget 2024 are provisionally expected to boost the level of GDP by around 0.75% at their peak in a year’s time, relative to the August projections, while the Budget is provisionally expected to boost CPI inflation by just under 0.5% at the peak.
• Annual private sector regular average weekly earnings growth has continued to fall but remained elevated at 4.8% in the three months to August; the MPC judges that the labour market continues to loosen, although it appears relatively tight by historical standards.
• Based on the evolving evidence, a gradual approach to removing policy restraint remains appropriate but monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
• The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Medium Bearish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Without major news events, CAD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 1.3948

Resistance: 1.4263

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 50 basis points bringing it down to 3.75% while continuing its policy of balance sheet normalization on 23rd October; this marked the fourth consecutive meeting where rates were reduced.
• Canada’s economy grew at around 2% in the first half of the year and growth of 1.75% is expected in the second half; consumption has continued to grow but is declining on a per person basis while exports have been boosted by the opening of the Trans Mountain Expansion pipeline.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.3% in 2026 – as the economy strengthens, excess supply is gradually absorbed.
• The labour market remains soft with unemployment at 6.5% in September while wage growth remains elevated relative to productivity growth. Overall, the economy continues to be in excess supply.
• Headline CPI has declined significantly from 2.7% in June to 1.6% in September while shelter costs inflation remains elevated but has begun to ease; the preferred measures of core inflation are now below 2.5%.
• Excess supply elsewhere in the economy has reduced inflation in the prices of many goods and services while the drop in global oil prices has led to lower gasoline prices – these factors have all combined to bring inflation down.
• The Bank expects inflation to remain close to the target over the projection horizon, with the upward and downward pressures on inflation roughly balancing out; the upward pressure from shelter and other services gradually diminishes, and the downward pressure on inflation recedes as excess supply in the economy is absorbed.
• With inflation now back around the 2% target, the Governing Council decided to reduce the policy rate by 50 basis points to support economic growth and keep inflation close to the middle of the 1% to 3% range.
• If the economy evolves broadly in line with the latest forecast, further reduction of the policy rate can be expected but the timing and pace of additional reductions in the policy rate will be guided by incoming information and assessment of its implications for the inflation outlook.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• Next meeting is on 11 December 2024.

Next 24 Hours Bias

Weak Bullish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

With no major news events today, oil prices may remain relatively stable, driven by technical factors and market sentiment – the support and resistance levels for today.

Support: 66.48

Resistance: 72.78

Next 24 Hours Bias

Medium Bullish

The post IC Markets Asia Fundamental Forecast | 2 December 2024 first appeared on IC Markets | Official Blog.

US Stocks Finish the Month on a High – Nasdaq Up 0.8%

US stock markets concluded another strong day on Wall Street on Friday, marking their best month in a year. The Dow rose by 0.42% on the day, the S&P gained 0.56%, while the Nasdaq outperformed, closing 0.83% higher. Markets resumed trading following the Thanksgiving holiday, with yields and the dollar continuing to retreat from recent highs. The DXY fell by 0.26%, ending the week at 105.79, while Treasury yields dropped significantly, with the two-year yield falling six basis points to 4.163% and the ten-year losing 6.8 basis points to close at 4.174%. Oil prices declined as supply concerns eased further, with Brent crude down 0.3% to $73.06 per barrel and WTI sliding 0.42% to $68.43 per barrel. Meanwhile, gold rose by 0.5% to $2,652.71.

US Data in Focus Ahead of the Fed

This week could prove pivotal for financial markets, with a host of US data releases scheduled alongside updates from key Federal Reserve members, including Jerome Powell. With only 16 days remaining until the final Fed meeting of the year, markets currently predict a 65% likelihood of a 25-basis point rate cut. However, any shift in rhetoric from Fed officials or resilient economic data could significantly alter these expectations. Friday’s employment figures are set to be the highlight of the week, although other key data releases—including CPI figures in the following seven days—could also influence market movements. Investors anticipate heightened activity as US traders return to action following the Thanksgiving holiday, reacting to fresh updates.

Full Calendar Week Ahead for Traders

A pivotal week lies ahead for financial markets, with a strong emphasis on the US economy dominating the macroeconomic calendar. Notably, today’s trading session begins with significant events likely to induce early-week volatility. Asian markets will initially focus on Australia’s latest Retail Sales figures, with a month-on-month increase of 0.4% anticipated. The London session is relatively quiet, but the New York session brings the first—though certainly not the last—tier-one US data release of the week. The ISM Manufacturing PMI is expected to come in at 47.7. Later in the day, traders will also hear from Fed members Waller and Williams, with their commentary eagerly awaited as the year’s final Fed meeting approaches.

The post General Market Analysis – 02/12/24 first appeared on IC Markets | Official Blog.

The macroeconomic calendar picks up significantly this week, with the major focus on Friday when the US employment data is set to be released. There are plenty of other updates scheduled in the preceding days, and traders are anticipating a lively week ahead.

The US economy takes centre stage, with several Federal Reserve members scheduled to speak, including Fed Chair Jerome Powell. Alongside a wealth of data, most investors hope for a clearer indication of the Fed’s next move by the end of the week.

Here is our usual day-by-day breakdown of the major risk events this week:

The early focus in Asian markets will be on Australia as the latest retail sales figures are released early in the session. The European session features a raft of Final PMI data releases, although these are far less impactful than the Flash data. The New York session sees the full return of US markets and data releases, with ISM Manufacturing PMI due before we hear from Federal Reserve members Waller and Williams later in the day.

The Asian session is relatively quiet, but attention will shift to Swiss markets during the European open when the latest CPI data is released. The first (but certainly not the last) jobs numbers of the week will follow soon after the US open, with the JOLTS Job Openings report. Later, more Federal Reserve members—this time Kugler and Goolsbee—are scheduled to speak.

The Asian open will once again focus on Australia, with the release of key GDP data early in the day. In Europe, the spotlight will turn to the UK as Bank of England Governor Andrew Bailey is set to speak midway through the session, followed by ECB President Christine Lagarde later. The New York session is expected to be lively, with both ADP Non-Farm Employment Change and ISM Services PMI data scheduled for release, followed by remarks from Fed Chair Jerome Powell later in the day.

The Asian session is likely to remain quiet, but attention will return to the UK during the London open, with Construction PMI data scheduled for release. In the New York session, more US jobs data will be released, including the usual weekly unemployment claims, before the focus shifts north of the border for Canadian Ivey PMI figures.

Friday’s focus will firmly be on the key US employment data. With little else of note during the earlier sessions, traders expect a relatively quiet day until the New York open. As usual, the Non-Farm Payrolls, Average Hourly Earnings, and Unemployment Rate will all be updated simultaneously, and significant volatility is anticipated around the release. Canadian employment numbers and US University of Michigan data are also scheduled for later in the session, but the US employment data is expected to dominate market movements.

The post The Week Ahead – Week Commencing 02 December 2024 first appeared on IC Markets | Official Blog.

The post Ex-Dividend 02/12/2024 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei down 0.48%, Shanghai Composite down 1.14%, Hang Seng up 0.2% ASX down 0.1%
• Commodities : Gold at $2687.35 (0.94%), Silver at $31.19 (1.28%), Brent Oil at $72.74 (-0.06%), WTI Oil at $69.27 (0.29%)
• Rates : US 10-year yield at 4.234, UK 10-year yield at 4.271, Germany 10-year yield at 2.1245

News & Data:

• (CAD) Current Account -3.2B vs -8.6B expected

Markets Update:

Asia-Pacific markets saw mixed performance on Friday, with most losing ground led by South Korea’s stocks following weak industrial production data. South Korea’s industrial production declined by 0.3% month-on-month in October, matching September’s drop. However, on a year-on-year basis, production increased by 2.3% in October, rebounding from a 1.3% fall in September.

The Kospi index dropped 1.29%, and the small-cap Kosdaq fell 1.87%. In contrast, Hong Kong’s Hang Seng index gained 1.29%, while mainland China’s CSI 300 rose 2%, leading regional gains. The rise coincided with a Reuters poll suggesting that China’s home prices may decline at a slower pace through 2025 and stabilize in 2026, as support measures take effect.

Meanwhile, Japan’s Tokyo inflation data showed the headline rate rebounded to 2.6% in November from 1.8% in October. Core inflation, excluding fresh food costs, rose to 2.2%, slightly exceeding expectations. Tokyo’s inflation trends are seen as a precursor for nationwide patterns. Following the release, Japan’s Nikkei 225 fell 0.42%, while the Topix index slipped 0.2%.

Australia’s S&P/ASX 200 recorded a minor loss of 0.14%.

U.S. markets remained closed on Thursday for Thanksgiving and will operate for a shortened trading session on Friday.

Upcoming Events: 

• 01:30 PM GMT – CAD GDP m/m

The post Friday 29th November 2024: Asia-Pacific Markets Dip as South Korea Slips, China Leads Gains first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 29 November 2024

What happened in the Asia session?

In the Asia session today, the forex market experienced notable movements. The USD/JPY saw a rise, reflecting broader dollar strength, influenced by the US Treasury yields climbing. Meanwhile, AUD/USD faced pressure, with weaker-than-expected domestic economic data weighing on the Australian dollar. The EUR/USD traded within a narrow range, with market sentiment largely influenced by expectations of the ECB’s next steps amid inflation concerns. GBP/USD also showed mixed performance, reflecting the market’s cautious outlook on UK economic recovery. Overall, traders remained cautious as they awaited further developments in global economic conditions, especially from the US and Europe.

What does it mean for the Europe & US sessions?

The strong U.S. economic data and dollar strength are expected to influence the Asia session by maintaining upward pressure on the U.S. dollar against Asian currencies like the Japanese Yen (JPY), Chinese Yuan (CNY), and Australian Dollar (AUD). While USD/JPY may continue to rise, safe-haven assets such as the Yen and gold could strengthen if risk-off sentiment prevails. Asian equity markets are likely to open cautiously due to lingering concerns about tighter U.S. monetary policy.

The Federal Reserve’s hawkish stance may compel Asian central banks to avoid aggressive easing to prevent currency depreciation. Meanwhile, commodity-linked currencies like the AUD and NZD may face headwinds if subdued risk sentiment persists or China’s economic outlook dampens demand.

The Dollar Index (DXY)

Key news events today

No major news events.

What can we expect from DXY today?

In the absence of major economic news, the U.S. Dollar Index (DXY) is likely to experience limited volatility, with movements primarily influenced by technical factors and market sentiment –  the support and resistance levels for today.

Support: 105.441

Resistance: 106.521

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to lower the Federal Funds Rate target range by 25 basis points to 4.50% to 4.75% on 7th November.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance.
• The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while labour market conditions have generally eased, and the unemployment rate has moved up but remains low.
• Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 17 to 18 December 2024.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Key news events today

No major news events.

What can we expect from Gold today?

In the absence of major news, gold prices today may experience modest fluctuations driven by market sentiment, technical factors, and broader economic trends –  the support and resistance levels for today.

Support: 2606.39

Resistance: 2656.94

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

When there’s no major news, the Australian Dollar (AUD) typically follows market sentiment driven by broader economic factors like commodity prices, global risk appetite, and U.S. dollar strength. The AUD is heavily influenced by Australia’s key exports, such as iron ore and gold, so fluctuations in global commodity markets can lead to price movements –   the support and resistance levels for today.

Support: 0.6442

Resistance: 0.6541

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35% on 5th November, marking the eighth consecutive pause.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but the forecasts published in today’s Statement on Monetary Policy (SMP) do not see inflation returning sustainably to the midpoint of the target until 2026.
• Headline inflation was 2.8% over the year to the September quarter, down from 3.8% over the year to the June quarter; this was as expected due to declines in fuel and electricity prices in the September quarter.
• However, this decline reflects a temporary cost of living relief; abstracting from these effects, underlying inflation (as represented by the trimmed mean) was 3.5% over the year to the September quarter and is still some way from the 2.5% midpoint of the inflation target.
• Growth in output has been weak as past declines in real disposable incomes and the ongoing effect of restrictive financial conditions continue to weigh on household consumption, particularly discretionary consumption.
• However, growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, has remained more resilient.
• A range of indicators suggest that labour market conditions remain tight, and while conditions have been easing gradually, some indicators have recently stabilised.
• Employment grew strongly over the three months to September, by an average of 0.4% per month but the unemployment rate was 4.1% in September, up from the trough of 3.5% in late 2022.
• While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high while the November SMP forecasts suggest that it will be some time yet before inflation is sustainably in the target range and approaching the midpoint.
• This reinforces the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out.
• Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range and it will continue to rely upon the data and the evolving assessment of risks to guide its decisions.
• Next meeting is on 10 December 2024.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Without major news events, NZD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.5862

Resistance: 0.5937

Central Bank Notes:

• The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
• The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
• Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
• The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
• High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
• The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
• Next meeting is on 27 November 2024.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

JPY is expected to trade within 149.135 – 151.603 today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 149.13

Resistance: 151.60

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 31st October, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) is likely to be at around 2.5% for fiscal 2024 and then be at around 2% for fiscal 2025 and 2026.
• While the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices are expected to wane, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• Comparing the projections with those presented in the previous Outlook for Economic Activity and Prices (Outlook Report), the projected real GDP growth rates are more or less unchanged. The projected year-on-year rate of increase in the CPI (all items less fresh food) for fiscal 2025 is somewhat lower due to factors such as the recent decline in crude oil and other resource prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

EUR is expected to trade within 1.05168 – 1.07111 today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 1.0516

Resistance: 1.0646

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17th October to mark the second successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.40%, 3.65% and 3.25% respectively.
• The incoming information on inflation shows that the disinflationary process is well on track while the inflation outlook is also affected by recent downside surprises in indicators of economic activity.
• Inflation is expected to rise in the coming months, before declining to target in the course of next year. Domestic inflation remains high, as wages are still rising at an elevated pace. At the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

CHF is expected to trade within 0.8765 – 0.8855  today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 0.8765

Resistance: 0.8855

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
• Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
• Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
• The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
• Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
• However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bearish

The Pound (GBP)

Key news events today

BOE Gov Bailey Speaks (11:00 am GMT)

What can we expect from GBP today?

With Bank of England Governor Andrew Bailey speaking at 11:00 am GMT today, expect GBP to be sensitive to his comments, particularly regarding inflation, interest rates, and economic recovery. Bailey’s remarks could provide insights into the BOE’s stance on current monetary policy, particularly after recent rate hikes or discussions about future adjustments. If he signals concerns about economic slowdowns or hints at a dovish stance, the GBP could weaken, especially against currencies like the USD. Conversely, if his comments suggest ongoing confidence in the economy or a potential for tightening measures, GBP may strengthen.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to reduce the Bank Rate by 25 basis points, to 4.75% on 7th November 2024 – one member preferred to maintain the Bank rate at 5.0%.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024.
• Twelve-month CPI inflation fell to 1.7% in September but is expected to increase to around 2.5% by the end of the year as weakness in energy prices falls out of the annual comparison; services consumer price inflation has declined to 4.9%.
• CPI inflation is expected to increase to around 2.75% by the second half of 2025 as weakness in energy prices falls out of the annual comparison, revealing more clearly the continuing persistence of domestic inflationary pressures.
• The MPC’s latest projections for activity and inflation are also set out in the accompanying November Report; this forecast is based on the second case where CPI inflation is projected to fall back to around the 2% target in the medium term as a margin of slack emerges later in the forecast period that acts against second-round effects in domestic prices and wages.
• GDP had grown by 0.5% in 2024 Q2, 0.2% weaker than had been expected in the August Report, and 0.1% weaker than the earlier outturn had indicated at the time of the MPC’s previous meeting. Through the second half of 2024, GDP was projected to grow at a somewhat slower rate than in Q2 – headline GDP growth is expected to fall back to its recent underlying pace of around 0.25% per quarter over the second half of this year.
• The combined effects of the measures announced in Autumn Budget 2024 are provisionally expected to boost the level of GDP by around 0.75% at their peak in a year’s time, relative to the August projections, while the Budget is provisionally expected to boost CPI inflation by just under 0.5% at the peak.
• Annual private sector regular average weekly earnings growth has continued to fall but remained elevated at 4.8% in the three months to August; the MPC judges that the labour market continues to loosen, although it appears relatively tight by historical standards.
• Based on the evolving evidence, a gradual approach to removing policy restraint remains appropriate but monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
• The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Medium Bullish

The Canadian Dollar (CAD)

Key news events today

GDP m/m (1:30 pm GMT)

What can we expect from CAD today?

The GDP m/m release at 1:30 pm GMT will provide crucial insights into Canada’s economic health. A stronger-than-expected GDP could push the CAD higher, as it signals growth and potential rate hikes by the Bank of Canada. Conversely, a weaker result may weigh on the CAD, suggesting a slowdown and reduced rate hike expectations. 

Given the recent inflation and employment trends, the market’s reaction could be swift, especially if the GDP deviates significantly from expectations. Expect heightened volatility around the release.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 50 basis points bringing it down to 3.75% while continuing its policy of balance sheet normalization on 23rd October; this marked the fourth consecutive meeting where rates were reduced.
• Canada’s economy grew at around 2% in the first half of the year and growth of 1.75% is expected in the second half; consumption has continued to grow but is declining on a per person basis while exports have been boosted by the opening of the Trans Mountain Expansion pipeline.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.3% in 2026 – as the economy strengthens, excess supply is gradually absorbed.
• The labour market remains soft with unemployment at 6.5% in September while wage growth remains elevated relative to productivity growth. Overall, the economy continues to be in excess supply.
• Headline CPI has declined significantly from 2.7% in June to 1.6% in September while shelter costs inflation remains elevated but has begun to ease; the preferred measures of core inflation are now below 2.5%.
• Excess supply elsewhere in the economy has reduced inflation in the prices of many goods and services while the drop in global oil prices has led to lower gasoline prices – these factors have all combined to bring inflation down.
• The Bank expects inflation to remain close to the target over the projection horizon, with the upward and downward pressures on inflation roughly balancing out; the upward pressure from shelter and other services gradually diminishes, and the downward pressure on inflation recedes as excess supply in the economy is absorbed.
• With inflation now back around the 2% target, the Governing Council decided to reduce the policy rate by 50 basis points to support economic growth and keep inflation close to the middle of the 1% to 3% range.
• If the economy evolves broadly in line with the latest forecast, further reduction of the policy rate can be expected but the timing and pace of additional reductions in the policy rate will be guided by incoming information and assessment of its implications for the inflation outlook.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• Next meeting is on 11 December 2024.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

With no major news events today, oil prices may remain relatively stable, driven by technical factors and market sentiment – the support and resistance levels for today.

Support: 68.34

Resistance: 70.78

Next 24 Hours Bias

Medium Bullish

The post IC Markets Europe Fundamental Forecast | 29 November 2024 first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish continuation toward the 1st support 

Pivot: 106.57
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 105.43
Supporting reasons: Identified as a pullback support that aligns with the 61.8% Fibonacci retracement, indicating a potential level where price could find support once more.

1st resistance: 108.62
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 1.0527

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 1.0335

Supporting reasons: Identified as a swing low support, indicating a potential level where price could find support once more.

1st resistance: 1.0646
Supporting reasons: Identified as a pullback resistance close to 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish continuation toward the 1st support 

Pivot: 160.58
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 157.38

Supporting reasons: Identified as a pullback support that aligns with 78.6% Fibonacci retracement, indicating a potential level where price could find support once more.

1st resistance: 162.06
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

EUR/GBP:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 0.8376

Supporting reasons: Identified as an overlap resistance close to 61.8% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 0.8266

Supporting reasons: Identified as a swing low support, indicating a potential level where price could find support once more.

1st resistance: 0.8452
Supporting reasons: Identified as a multi swing high resistance, indicating a potential area that could halt any further upward movement.

GBP/USD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 1.2735

Supporting reasons: Identified as a pullback resistance close to 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 1.2615

Supporting reasons: Identified as a pullback support, indicating a potential level where price could find support once more.

1st resistance:  1.2858
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

GBP/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 192.86

Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressures could intensify.

1st support: 189.90
Supporting reasons: Identified as an overlap support close to 61.8% Fibonacci projection, indicating a key level where price could find support once more.

1st resistance: 195.63
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

USD/CHF:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 0.8855

Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 0.8765
Supporting reasons: Identified as a pullback support close to 127.2% Fibonacci extension, indicating a potential level where price could find support once more.

1st resistance: 0.8917
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

USD/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 150.83

Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 149.13
Supporting reasons: Identified as an overlap support close to 50% Fibonacci retracement, indicating a potential level where price could find support once again.

1st resistance: 152.26
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

USD/CAD:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish continuation toward the 1st support 

Pivot: 1.4088
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 1.3955
Supporting reasons: Identified as pullback support close to 61.8% Fibonacci retracement, indicating a key level where price could find support once more.

1st resistance: 1.4178
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 0.6484

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 0.6440
Supporting reasons: Identified as a swing-low support, suggesting a key support area where price could find support once again.

1st resistance: 0.6557
Supporting reasons: Identified as a pullback resistance close to 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 0.5867

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 0.5816
Supporting reasons: Identified as a swing low support, suggesting a key support area where price could find support.

1st resistance: 0.5935
Supporting reasons: Identified as an overlap resistance close to 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 44,524.83

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 43,330.61

Supporting reasons: Identified as an overlap support, indicating a potential level where price could find support.

1st resistance: 45,536.44

Supporting reasons: Aligns with the 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 19,159.78

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 18,910.28

Supporting reasons: Identified as a multi-swing low support, indicating a key level where price could find support once more.

1st resistance: 19,680.84
Supporting reasons: Identified as a swing-high resistance close to 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 5,965.82

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 5,872,10

Supporting reasons: Identified as an overlap support that aligns with a 50% Fibonacci retracement, indicating a potential level where price could find support again.

1st resistance: 6,143.88
Supporting reasons: Aligns with 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish breakout off the pivot and fall toward the 1st support.

Pivot: 97,227.20
Supporting reasons: Identified as an overlap resistance close to 78.6% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 91,788.09
Supporting reasons: Identified as an overlap support that aligns with the 23.6% Fibonacci retracement, indicating a potential level where price could find support.

1st resistance: 99,462.79
Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 3,740.72

Supporting reasons: Identified as an overlap resistance close to 161.8% Fibonacci extension, indicating a potential area where selling pressures could intensify.

1st support: 3,486.97
Supporting reasons: Identified as a pullback support, indicating a potential level where price could find support once again

1st resistance: 3893.83
Supporting reasons:  Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off the pivot and rise toward the 1st resistance

Pivot: 68.23
Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound

1st support: 66.76
Supporting reasons: Identified as a swing-low support, indicating a key level where price could find support once again.

1st resistance: 70.78
Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off the pivot and drop toward the 1st support 

Pivot: 2684.07

Supporting reasons: Identified as a pullback resistance close to 61.8% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 2607.07

Supporting reasons: Identified as an overlap support that aligns with 61.8% Fibonacci retracement, indicating a potential level where price could find support.

1st resistance: 2728.19
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

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The post Friday 29th November 2024: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 29 November 2024

What happened in the U.S. session?

the U.S. forex session saw the dollar strengthen following robust economic data. Q3 GDP growth beat expectations at 3.8%, highlighting a resilient U.S. economy. Weekly jobless claims remained low, signaling a strong labor market, while the Consumer Confidence Index, though slightly below forecast, reflected positive sentiment.

Key currency movements included declines in EUR/USD and GBP/USD as the dollar gained strength. USD/JPY rose amid improved risk sentiment and robust U.S. data, while AUD/USD weakened due to global risk concerns and weaker Chinese economic outlook.

What does it mean for the Asia Session?

The strong U.S. economic data and dollar strength are expected to influence the Asia session by maintaining upward pressure on the U.S. dollar against Asian currencies like the Japanese Yen (JPY), Chinese Yuan (CNY), and Australian Dollar (AUD). While USD/JPY may continue to rise, safe-haven assets such as the Yen and gold could strengthen if risk-off sentiment prevails. Asian equity markets are likely to open cautiously due to lingering concerns about tighter U.S. monetary policy.

The Federal Reserve’s hawkish stance may compel Asian central banks to avoid aggressive easing to prevent currency depreciation. Meanwhile, commodity-linked currencies like the AUD and NZD may face headwinds if subdued risk sentiment persists or China’s economic outlook dampens demand.

The Dollar Index (DXY)

Key news events today

No major news events.

What can we expect from DXY today?

In the absence of major economic news, the U.S. Dollar Index (DXY) is likely to experience limited volatility, with movements primarily influenced by technical factors and market sentiment –  the support and resistance levels for today.

Support: 105.441

Resistance: 106.521

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to lower the Federal Funds Rate target range by 25 basis points to 4.50% to 4.75% on 7th November.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance.
• The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while labour market conditions have generally eased, and the unemployment rate has moved up but remains low.
• Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 17 to 18 December 2024.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Key news events today

No major news events.

What can we expect from Gold today?

In the absence of major news, gold prices today may experience modest fluctuations driven by market sentiment, technical factors, and broader economic trends –  the support and resistance levels for today.

Support: 2606.39

Resistance: 2656.94

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

When there’s no major news, the Australian Dollar (AUD) typically follows market sentiment driven by broader economic factors like commodity prices, global risk appetite, and U.S. dollar strength. The AUD is heavily influenced by Australia’s key exports, such as iron ore and gold, so fluctuations in global commodity markets can lead to price movements –   the support and resistance levels for today.

Support: 0.6442

Resistance: 0.6541

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35% on 5th November, marking the eighth consecutive pause.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but the forecasts published in today’s Statement on Monetary Policy (SMP) do not see inflation returning sustainably to the midpoint of the target until 2026.
• Headline inflation was 2.8% over the year to the September quarter, down from 3.8% over the year to the June quarter; this was as expected due to declines in fuel and electricity prices in the September quarter.
• However, this decline reflects a temporary cost of living relief; abstracting from these effects, underlying inflation (as represented by the trimmed mean) was 3.5% over the year to the September quarter and is still some way from the 2.5% midpoint of the inflation target.
• Growth in output has been weak as past declines in real disposable incomes and the ongoing effect of restrictive financial conditions continue to weigh on household consumption, particularly discretionary consumption.
• However, growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, has remained more resilient.
• A range of indicators suggest that labour market conditions remain tight, and while conditions have been easing gradually, some indicators have recently stabilised.
• Employment grew strongly over the three months to September, by an average of 0.4% per month but the unemployment rate was 4.1% in September, up from the trough of 3.5% in late 2022.
• While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high while the November SMP forecasts suggest that it will be some time yet before inflation is sustainably in the target range and approaching the midpoint.
• This reinforces the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out.
• Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range and it will continue to rely upon the data and the evolving assessment of risks to guide its decisions.
• Next meeting is on 10 December 2024.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Without major news events, NZD’s movement today is likely to be driven by technical factors, market sentiment, and overall risk appetite –  the support and resistance levels for today.

Support: 0.5862

Resistance: 0.5937

Central Bank Notes:

• The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
• The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
• Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
• The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
• High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
• The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
• Next meeting is on 27 November 2024.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

JPY is expected to trade within 149.135 – 151.603 today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 149.13

Resistance: 151.60

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 31st October, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) is likely to be at around 2.5% for fiscal 2024 and then be at around 2% for fiscal 2025 and 2026.
• While the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices are expected to wane, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• Comparing the projections with those presented in the previous Outlook for Economic Activity and Prices (Outlook Report), the projected real GDP growth rates are more or less unchanged. The projected year-on-year rate of increase in the CPI (all items less fresh food) for fiscal 2025 is somewhat lower due to factors such as the recent decline in crude oil and other resource prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

EUR is expected to trade within 1.05168 – 1.07111 today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 1.0516

Resistance: 1.0646

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17th October to mark the second successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.40%, 3.65% and 3.25% respectively.
• The incoming information on inflation shows that the disinflationary process is well on track while the inflation outlook is also affected by recent downside surprises in indicators of economic activity.
• Inflation is expected to rise in the coming months, before declining to target in the course of next year. Domestic inflation remains high, as wages are still rising at an elevated pace. At the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

CHF is expected to trade within 0.8765 – 0.8855  today, influenced by key economic events that strengthen USD/JPY – the support and resistance levels for today.

Support: 0.8765

Resistance: 0.8855

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
• Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
• Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
• The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
• Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
• However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
• Next meeting is on 12 December 2024.

Next 24 Hours Bias

Medium Bearish

The Pound (GBP)

Key news events today

BOE Gov Bailey Speaks (11:00 am GMT)

What can we expect from GBP today?

With Bank of England Governor Andrew Bailey speaking at 11:00 am GMT today, expect GBP to be sensitive to his comments, particularly regarding inflation, interest rates, and economic recovery. Bailey’s remarks could provide insights into the BOE’s stance on current monetary policy, particularly after recent rate hikes or discussions about future adjustments. If he signals concerns about economic slowdowns or hints at a dovish stance, the GBP could weaken, especially against currencies like the USD. Conversely, if his comments suggest ongoing confidence in the economy or a potential for tightening measures, GBP may strengthen.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to reduce the Bank Rate by 25 basis points, to 4.75% on 7th November 2024 – one member preferred to maintain the Bank rate at 5.0%.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024.
• Twelve-month CPI inflation fell to 1.7% in September but is expected to increase to around 2.5% by the end of the year as weakness in energy prices falls out of the annual comparison; services consumer price inflation has declined to 4.9%.
• CPI inflation is expected to increase to around 2.75% by the second half of 2025 as weakness in energy prices falls out of the annual comparison, revealing more clearly the continuing persistence of domestic inflationary pressures.
• The MPC’s latest projections for activity and inflation are also set out in the accompanying November Report; this forecast is based on the second case where CPI inflation is projected to fall back to around the 2% target in the medium term as a margin of slack emerges later in the forecast period that acts against second-round effects in domestic prices and wages.
• GDP had grown by 0.5% in 2024 Q2, 0.2% weaker than had been expected in the August Report, and 0.1% weaker than the earlier outturn had indicated at the time of the MPC’s previous meeting. Through the second half of 2024, GDP was projected to grow at a somewhat slower rate than in Q2 – headline GDP growth is expected to fall back to its recent underlying pace of around 0.25% per quarter over the second half of this year.
• The combined effects of the measures announced in Autumn Budget 2024 are provisionally expected to boost the level of GDP by around 0.75% at their peak in a year’s time, relative to the August projections, while the Budget is provisionally expected to boost CPI inflation by just under 0.5% at the peak.
• Annual private sector regular average weekly earnings growth has continued to fall but remained elevated at 4.8% in the three months to August; the MPC judges that the labour market continues to loosen, although it appears relatively tight by historical standards.
• Based on the evolving evidence, a gradual approach to removing policy restraint remains appropriate but monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
• The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• Next meeting is on 19 December 2024.

Next 24 Hours Bias

Medium Bullish

The Canadian Dollar (CAD)

Key news events today

GDP m/m (1:30 pm GMT)

What can we expect from CAD today?

The GDP m/m release at 1:30 pm GMT will provide crucial insights into Canada’s economic health. A stronger-than-expected GDP could push the CAD higher, as it signals growth and potential rate hikes by the Bank of Canada. Conversely, a weaker result may weigh on the CAD, suggesting a slowdown and reduced rate hike expectations. 

Given the recent inflation and employment trends, the market’s reaction could be swift, especially if the GDP deviates significantly from expectations. Expect heightened volatility around the release.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 50 basis points bringing it down to 3.75% while continuing its policy of balance sheet normalization on 23rd October; this marked the fourth consecutive meeting where rates were reduced.
• Canada’s economy grew at around 2% in the first half of the year and growth of 1.75% is expected in the second half; consumption has continued to grow but is declining on a per person basis while exports have been boosted by the opening of the Trans Mountain Expansion pipeline.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.3% in 2026 – as the economy strengthens, excess supply is gradually absorbed.
• The labour market remains soft with unemployment at 6.5% in September while wage growth remains elevated relative to productivity growth. Overall, the economy continues to be in excess supply.
• Headline CPI has declined significantly from 2.7% in June to 1.6% in September while shelter costs inflation remains elevated but has begun to ease; the preferred measures of core inflation are now below 2.5%.
• Excess supply elsewhere in the economy has reduced inflation in the prices of many goods and services while the drop in global oil prices has led to lower gasoline prices – these factors have all combined to bring inflation down.
• The Bank expects inflation to remain close to the target over the projection horizon, with the upward and downward pressures on inflation roughly balancing out; the upward pressure from shelter and other services gradually diminishes, and the downward pressure on inflation recedes as excess supply in the economy is absorbed.
• With inflation now back around the 2% target, the Governing Council decided to reduce the policy rate by 50 basis points to support economic growth and keep inflation close to the middle of the 1% to 3% range.
• If the economy evolves broadly in line with the latest forecast, further reduction of the policy rate can be expected but the timing and pace of additional reductions in the policy rate will be guided by incoming information and assessment of its implications for the inflation outlook.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• Next meeting is on 11 December 2024.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

With no major news events today, oil prices may remain relatively stable, driven by technical factors and market sentiment – the support and resistance levels for today.

Support: 68.34

Resistance: 70.78

Next 24 Hours Bias

Medium Bullish

The post IC Markets Asia Fundamental Forecast | 29 November 2024 first appeared on IC Markets | Official Blog.