Dollar Retreats on Jobless Claims, Eye on NFP

Market Summary

The Dollar Index fell against six major currencies after US jobless claims rose to 224,000, exceeding the forecast of 215,000, dampening optimism ahead of the Nonfarm Payrolls report. Profit-taking weighed on the dollar, but rising US Treasury yields, supported by hawkish Fed remarks, limited losses as investors await further clarity on the labor market.

Bitcoin surged past $100,000 for the first time, fueled by optimism over pro-crypto policies under President-elect Donald Trump, including Paul Atkins’ SEC Chair nomination. After reaching $103,649, Bitcoin retreated to $98,803 on profit-taking, though bullish sentiment persists amid expectations for favorable regulatory moves.

Gold prices dropped as investors took profits ahead of key US labor data, pressured further by hawkish Fed comments on the strong economy. Fed Chair Powell’s confidence in monetary policy drove a selloff in safe-haven assets like gold.

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Current rate hike bets on 18th December Fed interest rate decision: 

Source: CME Fedwatch Tool

0 bps (40.4%) VS -25 bps (59.6%) 

Market Overview

Economic Calendar

(MT4 System Time)

Source: MQL5 

Market Movements

DOLLAR_INDX, H4

The Dollar Index remained flat as market participants digested statements from Fed Chair Jerome Powell and awaited Friday’s critical US jobs report. Powell highlighted the need for a cautious approach to rate cuts, emphasizing that the resilient US economy does not warrant aggressive monetary easing. The outlook for dollar trends hinges on upcoming economic data, leaving investors on edge for more clues.

The Dollar Index is trading flat while consolidating between support and resistance levels. MACD has illustrated diminishing bullish momentum, while RSI is at 50, suggesting the index might still struggle to seek direction since the RSI stays near the midline. 

Resistance level: 106.85, 108.05

Support level: 105.80, 104.45

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XAU/USD, H4

Gold prices remained flat, consolidating within a narrow range as investors maintained a cautious outlook amid mixed market sentiment. Renewed tensions in the Middle East, particularly Israel’s ongoing strikes against Hezbollah despite the ceasefire agreement, have fueled safe-haven demand for gold. However, this bullish momentum was capped by the stronger-than-expected US job openings data, which bolstered the dollar and curbed gold’s appeal.

Gold prices are trading flat while currently testing the resistance level. MACD has illustrated diminishing bullish momentum, while RSI is at 48, suggesting the commodity might edge lower since the RSI stays below the midline. 

Resistance level: 2650.00, 2705.00

Support level: 2610.00, 2550.00

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GBP/USD，H4

The GBP/USD pair is trading close to its recent high of 1.2725, supported by better-than-expected UK PMI readings, which boosted optimism about the British economy. Weak U.S. economic indicators released yesterday added to the pair’s upward momentum, providing additional relief for the Pound Sterling. However, gains remained tempered as market sentiment shifted following hawkish remarks from Federal Reserve Chair Jerome Powell. His statement, emphasizing the resilience of the U.S. economy, lent renewed strength to the greenback, limiting further upside for the pair.

The GBP/USD is currently hovering at its recent peak and is awaiting for fresh bullish momentum to break another high. The RSI remain above the 50 level while the MACD hovering flat close to the zero line, suggesting that the bullish momentum is lacking. 

Resistance level: 1.2790, 1.2850

Support level: 1.2620, 1.2505

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EUR/USD，H4

The EUR/USD pair remains muted as markets closely monitor the unfolding political crisis in France. The ruling party faced a no-confidence vote, leading to the ousting of the Prime Minister by the opposition. This political upheaval has injected uncertainty into the eurozone, keeping the euro largely flat as traders await clarity on the situation. With sentiment cautious, the pair shows limited movement, suggesting that investors are adopting a wait-and-see approach until the political outlook in France becomes clearer. 

The pair is traded sideways with lack of direction. The RSI hovered close to the 50 level while the MACD flowed in between the zero line, suggesting a neutral signal for the pair. 

Resistance level: 1.0607, 1.0680

Support level: 1.0440, 1.0325

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USD/JPY, H4

The USD/JPY pair breached its short-term resistance level at 150.80 but encountered notable selling pressure at this threshold. The Japanese yen weakened following a shift in market sentiment, with speculation around a December rate hike by the Bank of Japan waning. The probability of a rate increase has dropped sharply to 40% from 66%, eroding support for the yen. Meanwhile, the dollar gained momentum after hawkish remarks from Federal Reserve Chair Jerome Powell, who emphasized the resilience of the U.S. economy. 

The USD/JPY pair has eased from its bearish momentum and has formed a higher-high price pattern, suggesting a potential trend reversal for the pair. The RSI has rebounded while the MACD has a golden cross and is moving toward the zero line from below, suggesting that the bearish momentum is widely easing. 

Resistance level: 151.70, 154.00

Support level:149.35, 146.45

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NASDAQ, H4:

The US equity market continued its positive trajectory, with Wall Street hitting record highs as confidence in the tech sector surged. Strong earnings from Salesforce Inc., which jumped 11%, and ongoing momentum in NVIDIA Corporation further buoyed the Nasdaq Composite. Powell’s comments on the strong economic backdrop added optimism, suggesting a tempered pace of rate easing.

Nasdaq is trading higher following the prior breakout above the previous resistance level. However, MACD has illustrated diminishing bullish momentum, while RSI is at 79, suggesting the index might enter overbought territory. 

Resistance level:  21700.00, 22025.00

Support level:  21375.00, 20970.00

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CL OIL, H4

Oil prices edged lower as investors booked profits ahead of OPEC+’s decision on production cuts. A larger-than-expected draw in US crude stockpiles provided some support, with the Energy Information Administration reporting a significant drop in inventories as refiners ramped up operations. Nonetheless, gains were muted amid uncertainty over OPEC+’s policy direction.

Oil prices are trading lower following the prior retracement from the resistance level. MACD has illustrated increasing bearish momentum, while RSI is at 45, suggesting the commodity might extend its losses since the RSI stays below the midline. 

Resistance level: 70.40, 72.55

Support level: 68.05, 65.65

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