What You Need To Know

Equities markets in the Euro region edged higher as markets expect a slower pace in rate hikes. Both representatives from Russia and Ukraine met in the UAE to discuss the possibility of a prisoner-of-war swap, potentially easing the tension between the 2 nations. Covid cases have increased significantly in China especially in Beijing as quarantine facilities have been set up and lockdowns implemented in several regions. Binance is said to make a bid for another bankrupt crypto lender, Voyager Digital and is also in talks with Genesis Global for emergency funding to minimise the impact after the collapse of FTX. 

Look Out For

Current rate hike bets on 14th December Fed interest rate decision: 

75 bps (19.4%) VS 50 bps (80.6%)

Market Overview

Economic Calendar

Market Movements

DXY

The US Dollar extended its losses, with investors bracing for a less hawkish expectation from the Federal Reserve after the release of the FOMC meeting minutes. The meeting summary concluded that a substantial majority of the Monetary Policy Committee (MPC) agreed it would probably slow down the pace of interest rate hikes. Nonetheless, with US markets closed for the Thanksgiving holiday, the trading volume in the US Dollar remains subdued. Investors are advised to continue to monitor further economic data from the US region to gauge the likelihood trend for the US Dollar.

The Dollar Index is trading lower while currently testing the support level. However, MACD has illustrated diminishing bearish momentum, while RSI is at 36, suggesting the index is going into oversold territory. 

Resistance level: 107.95, 109.60

Support level: 105.75, 104.75

XAU/USD

With moderate rate hike expectations from the Federal Reserve adding to the market sentiment, the outlook for the US Dollar remains pessimistic, underpinning the dollar-denominated gold. Recent inflation figures from the United States had offered scant encouragement, prompting several Fed officials to note that a less aggressive rate hike decision would be more appropriate in coming meetings.

The gold market is trading higher following prior rebound from the support level. MACD has illustrated increasing bullish momentum, while RSI is at 56, suggesting a neutral-to-bullish stance as the RSI stood above the midline. 

Resistance level: 1785.00, 1815.00

Support level: 1730.00, 1680.00

EUR/USD

With US markets closed due to the Thanksgiving holidays, market participants are now focusing on other regions, such as Europe and Asia, where the trend has generally been optimistic after the Federal Reserve released their meeting minutes. The European stock market surged to its highest in over three months, while Euro extended its gains over the backdrop of upbeat economic data. According to the Ifo Institute for Economic Research, Germany’s Ifo Business Climate index notched up significantly from the previous reading of 84.5 to 86.3, exceeding the market forecast of 85.0. Germany’s economic outlook has become slightly brighter, with the improvement of economic growth and gas supply, curbing fears of a supply crunch for natural gas during winter.  

EUR/USD is trading higher while currently testing the resistance level at 1.0200. In addition, MACD has illustrated diminishing bearish momentum, while RSI is at 65, suggesting the pair still traded in a bullish zone but almost reached its overbought zone.

Resistance level: 1.0200,1.0370

Support level: 1.0008, 0.9879

BTC/USD

Binance’s CEO, CZ Zhao is said to make a bid to the bankrupt crypto lender, Voyager Digital. Zhao is seeking to minimise the damage caused by the collapse of FTX and bring stability back to the crypto market. Binance is also in talks with Genesis Global who is seeking emergency funding to stay alive. The market is expected to be quiet with low trading volume as Thanksgiving is celebrated on these 2 days.  

On the technical side, btc is expected to consolidate in the zone for some time before any catalyst to spur the coin. The MACD has crossed the zero line but the bullish momentum seems to have vanished after that. The RSI also depicts that the buying power is diminishing where it dropped to near the 50-level from above the 60-level. 

Resistance level: 17050, 18378

Support level: 15787, 15000

DJ30

Thanksgiving holiday last night and the stock exchange in the U.S. closed along with a shortened trading hour on Friday. Tension seems to be easing between Russia and Ukraine after representatives met in the UAE. in addition to the slower pace in rate hikes which favour the equities market, dow jones is expected to have some bullish momentum after the holiday. 

On the technical side, there is strong resistance to the index at 34190. It will be a more promising bullish momentum if the index is able to stay above this level. The RSI has been hovering above the 50-level and has now touched the overbought zone suggesting the buying power for the index is strong. However, the MACD depicts that the bullish momentum is lacking. 

Resistance level: 34190, 36810

Support level:  31370, 28760

GBP/USD

The pound soared to 1.21 against the pullback in the dollar as of writing. The pound enjoyed a magnificent November, gaining 5.3%. In contrast, we could expect the upswing to be limited due to October’s PMI remaining in negative territory. Moreover, the market would keep an eye on the labour market as the BoE predicts the unemployment rate will double to 6.5%. The Uk economy declined by 0.2% in Q3, and BoE warns that negative growth would likely extend till the first half of 2024. With all these formidable economic headwinds, it might be difficult for the pound to continue its upswing in the long term. 

The pound has broken through its strong resistance line at 1.20, suppressing the pair for 3 months. However, the momentum seems to ease after the resistance is broken, and there is another psychological resistance level of 1.23. The MACD shows a positive sign to the pound where the MACD line flows above the zero line and remains in bullish momentum in the near term. RSI is trading at 74, which already reach the overbought zone, indicating a diminishing bullish momentum ahead in the short term. 

Resistance：1.2297， 1.2676 

Support： 1.1967，1.1738

NAS100

The NASDAQ has a slightly upward movement as investors bracing for a less hawkish expectation from the Federal Reserve after the release of the FOMC meeting minutes. A more dovish rate hike expectation led to a rise in NASDAQ. The US markets closed for the Thanksgiving holiday yesterday and only half session on Friday. Investors could continue to monitor the upcoming economic data for further trading signals.

MACD hovers above the zero line, which suggests the indices remain in bullish momentum in the short term. At the same time, RSI is trading around 62, indicating a bullish momentum ahead.

Resistance level: 12096，12750

Support level: 11230，10459

CL OIL

Oil prices continue to hover in sight of two-month lows as the proposed G7 price cap of Russian oil raised doubts about how much it would reduce the oil supply. However, trading in the oil market remains subdued amid Thanksgiving holiday in the United States. As for now, European Union governments are still unable to achieve any consensus over what level to cap Russian oil prices to diminish Moscow’s ability to pay for its war in Ukraine without prompting a global oil supply disruption. More talks could be expected on Friday.

Crude oil prices are trading lower while currently testing the support level. However, MACD has illustrated increasing bullish momentum, while RSI is at 32, indicating the product was going into oversold territory. 

Resistance level: 83.10, 91.90

Support level: 76.45, 69.90