Dollar Rises on Jobs Data; Yen Gains on GDP Growth

• Strong US jobs data fuels dollar gains, with Nonfarm Payrolls surpassing expectations at 227K.

• Japan's economy grow 1.2% in Q3, boosting the yen on hopes of a potential rate hike.

• All eyes on US inflation data this Wednesday for clues on interest rate directions.

Market Summary

The US Dollar Index strengthened on Friday, driven by robust economic data that highlighted resilience in the US economy. Nonfarm Payrolls rose to 227K, exceeding expectations, while Average Hourly Earnings increased by 0.40%. With the Unemployment Rate steady at 4.2%, market participants are now eyeing Wednesday's Consumer Price Index (CPI) release for further clues on inflation and potential monetary policy adjustments.

Gold prices dipped as stronger US data and rising Treasury yields weighed on the non-yielding asset, though uncertainties in the Middle East offered some support. Similarly, oil prices remained mixed amid fears of supply disruptions after the ousting of Syrian President Bashar al-Assad.

The Japanese Yen rebounded as Japans economy grew at an annualized 1.2% in Q3, exceeding expectations and fueling speculation of a potential rate hike by the Bank of Japan. Meanwhile, Bitcoin soared past $100,000, buoyed by optimism over pro-crypto appointments in the incoming US administration, signaling potential for a more favorable regulatory landscape.

Market Movements

DOLLAR_INDX, H4

The Dollar Index rebounded last Friday, supported by a series of upbeat US economic data that bolstered confidence in the United States' economic progression. Average Hourly Earnings (MoM) rose 0.40%, beating expectations of 0.30%, while Nonfarm Payrolls climbed to 227K, surpassing forecasts of 202K. The US Unemployment Rate aligned with expectations at 4.2%. Market attention now shifts to the Consumer Price Index (CPI) data on Wednesday.

The Dollar Index is trading higher following the prior rebound from the support level. MACD has illustrated increasing bullish momentum, while RSI is at 49, suggesting the index might extend its gains since the RSI rebounded sharply from oversold territory.

Resistance level: 106.50, 107.00

Support level: 105.75, 104.50

XAU/USD, H4

Gold prices initially dropped following the release of better-than-expected US economic data, which shifted investor sentiment toward other asset classes. Additionally, rising US Treasury yields and a stronger dollar weighed on the non-yielding asset. However, uncertainties surrounding Middle East tensions, particularly after the rebel overthrow of Syrian President Bashar al-Assad and the resulting instability in Syria, sparked market volatility and lent some support to gold prices.

Gold prices are trading higher while currently near the resistance level. MACD has illustrated increasing bullish momentum, while RSI is at 54, suggesting the commodity might extend its gains since the RSI stays above the midline.

Resistance level: 2655.00, 2705.00

Support level: 2610.00, 2555.00

USD/JPY, H4

The Japanese Yen saw a slight rebound, driven by a positive economic outlook for Japan and increased speculation that the Bank of Japan may maintain or even hike interest rates. Japan's economy grew at an annualized rate of 1.2% in the July-September quarter, exceeding the initial estimate of 0.9%. This growth was fueled by upward revisions in capital investment and exports, reflecting the country's stronger-than-expected economic performance.

USD/JPY is trading lower while currently near the support level. MACD has illustrated diminishing bullish momentum, while RSI is at 46, suggesting the pair might extend its losses after breakout since the RSI stays below the midline.

Resistance level: 151.80, 154.15

Support level: 149.40, 146.45

CL OIL, H4

Oil prices experienced mixed performance during early Asian trade on Monday. Rising tensions in the Middle East, following the ousting of Syrian President Bashar al-Assad, raised fears of supply disruptions and offered some support to prices. Additionally, the growing adoption of electric vehicles continues to cap the long-term demand outlook for crude oil.

Oil prices are trading flat while currently near the support level. However, MACD has illustrated diminishing bearish momentum, while RSI is at 40, suggesting the commodity might experience technical correction since the RSI rebounded from oversold territory.

Resistance level: 68.00, 69.95

Support level: 66.90, 65.50