DBG Markets: Market Report for Nov 25, 2024

Market Overview

US Consumer Confidence is set for release on Tuesday, followed by major US economic data on Wednesday, including Prelim GDP and the Core PCE Price Index m/m. These figures will further shape expectations for a December rate cut. Additionally, unemployment claims are expected on the same day. Alongside the US data, the New Zealand (Kiwi) official cash rate and the RBNZ monetary policy statement will be announced. Markets anticipate a 50-basis-point rate cut, likely pricing in Kiwi weakness leading up to Tuesday's announcement. A substantial drop in the Kiwi is expected if the announcement aligns with this forecast. Australias CPI data is also scheduled for release on this day. On Thursday, the FOMC meeting will take place in the US. In Europe, CPI data will be released to provide additional clarity on rate expectations. Meanwhile, RBA Governor Lowe is set to deliver remarks, which could influence sentiment in the Australian market.

GOLD - Gold prices are expected to remain bullish as geopolitical risks escalate. Although doubts surrounding incoming Federal Reserve rate cuts could support bearish sentiment, the high-risk environment continues to bolster bullish momentum for gold. The MACD shows a bullish move, while the RSI trends upward. Price action aligns with these indicators, confirming increased bullish continuation in the chart.

SILVER - Silver prices are also climbing, distancing themselves from the range bottom at 30.668. Both the MACD and RSI indicate bullish momentum, aligning with price action that suggests continuation in this upward trend.

DXY - The dollar maintains strong momentum, although it failed to breach the 107.834 level in last week's trading. The MACD points upward with robust momentum, while the RSI indicates bearish divergence, suggesting a potential pullback. Recent price action indicates that the dollar is likely to resume its upward movement, demonstrating resilience and strength.

GBPUSD - The pound remains on a bearish trajectory, as previously forecasted. Although the RSI shows buying momentum, divergence suggests the bearish trend will persist. The MACD supports this outlook with strong bearish momentum. Fundamentals, including heightened geopolitical risks tied to the Russia-Ukraine conflict, also weigh heavily on the pound.

AUDUSD - The Australian dollar shows increased selling momentum amid geopolitical tensions, which have reduced its appeal. Divergence in the RSI aligns with price action, suggesting bearish continuation. While the MACD prints lighter histograms indicative of a potential short-term pullback, a sharp drop with strong volume could invalidate this and reinforce the bearish trend.

NZDUSD - The Kiwi shows heightened chances of continued declines, with price action breaking below previous swing lows. While the RSI reflects bullish movement, divergence signals a potential sell-off. The MACD recently crossed upward but suggests diminishing bullish momentum, further supporting a bearish outlook.

EURUSD - The Euro has experienced heavy losses due to strong US data, which delays expectations for a December rate cut. The Euro is also weighed down by anticipated tariffs and its vulnerability to the ongoing Ukraine conflict. Investor confidence in Europe remains low, dragging the currency downward. While the RSI hints at a short-term pullback, the MACD and price action indicate strong bearish momentum.

USDJPY - The Yen is consolidating with increased chances of an upward move after failing to break below previous swing lows. The MACD and RSI suggest bullish continuation, but divergence in the RSI indicates a potential downward move. Market expectations of a BOJ rate hike are bolstering the Yen, though inflationary pressures from the US dollar could temper these gains. BOJ intervention remains a significant factor, warranting caution in this market.

USDCHF - The Franc continues its bullish momentum after failing to break below previous swing lows. While the MACD and RSI support continued upward movement, divergence in the RSI hints at a potential pullback. Price action still leans toward a bullish continuation.

USDCAD - The Canadian dollar shows strength as price action suggests a continuation of the bearish trend. However, a head-and-shoulders pattern could lead to a bullish reversal. While the RSI favors bearish continuation, the MACD is nearing a crossover into sell territory. Market sentiment is shaped by delayed rate cut expectations, leaving traders waiting for further confirmation of the CAD's direction.