Forex

Governor of the Federal Reserve (Fed) Christopher Waller announced that inflation is too high, but that progress has been achieved and that the Fed will not need a further raise of the interest rate.

Nevertheless, the growing likelihood that the Fed will stop raising interest rates weighs on the USD and supports the GBP/USD pair.

Aside from this, the data released in late November revealed that the US CB Consumer Confidence increased to 102.00 in November after being revised downward to 99.1 in October.



The US dollar was the most adverse performer among foreign currencies. Risk-on-solid sentiment sweeping global markets and a noteworthy drop in global treasury yields drove this reduction.

The growing view among traders that most of the major central banks, such as the Fed, have completed their interest rate hike cycles is a critical element affecting this trend. Furthermore, traders are increasingly inclined to bet on rate reduction in the coming year.

EUR/USD rose to 1.0964 in November but failed to hold above the 61.8% fib retracement around 1.1275 to 1.0448 at 1.0960 and fell. However, the overall bias remains neutral. As long as the 1.0823 support holds, a further surge is possible. On the other hand, a break of 1.0823 support will imply a short-term topping and shift the market bias for a further drop.

The surge in the GBP/USD from 1.2036 to 1.2613 continued till the last week of November. The primary inclination is the upside for a 61.8% retracement of 1.3142 to 1.2037 at 1.2717 next. On the downside, a break below 1.2523 support will change the neutral intraday bias and bring the consolidation price before mounting another rise.

Conversely, the USD made a moderate rebound from its lowest value since August 11, assisting the USD/JPY pair to recover around 75 pips from the 146.65 range in November. Although spot prices return to the mid-147.00s, any principal appreciation remains elusive. The growing consensus that the Fed is done raising interest rates will cap the USD and act as a headwind.

The Australian dollar was traded close to the psychological mark of 0.6630 in November. The 0.6700 level is considered the psychological event zone, followed by resistance at the critical level of 0.6650. The AUD/USD pair might test the 0.6723 level (around August's high) if a bullish price breakout is plotted above this level. The critical support is located at 0.6592, the 7-day Exponential Moving Average (EMA). The pair may be able to reach the support area close to the 23.6% Fibo level near 0.6569 if there is a clear break below the EMA.

Commodities

The market for crude oil was visibly unstable in November. Every market has an uncertain future, of course, but the situation surrounding oil right now is quite confusing.

Even if the US dollar has generally weakened, the symptoms of dissatisfaction continued throughout this month. Reuters sources stated that the negotiations are challenging and that a further delay is probable. This caused the price of crude oil to drop back below $75.

With OPEC+ unable to reach a consensus to prolong production curbs, the oil market remains unstable. The price of WTI and Brent might rise above $80 to $83, respectively, if an agreement is reached soon.

Gold is poised to set a new all-time high, while silver faces resistance near $25-$26. We go over the critical weekly and monthly resistance levels.

Commercial traders are likely to consider the $1,925 level as a valid demand zone. However, gold bugs concentrate on that figure when making fresh purchases and hope the price reaches its peak of $2,080 before a substantial decline in value.

The daily gold chart printed an inverse H&S pattern, consistent with several major Indian jewelers' demand for $2200 by the next year, and the $2080 level will likely be hit within December.

The price of silver is currently exhibiting a minor negative trend, and given the influence of stochastic negativity, it may test the important support level of 24.60 before rising again.

As long as the support above holds, the uptrend scenario is generally still applicable at the end of November. This serves as a reminder that the next possible upside target is 25.50.

Indices

DXY maintained a poor performance, around 103.00 in November. It is anticipated that the index will continue to weaken and eventually test the critical support level at 103.00. The loss of this region exposes the weekly low around 102.93 (August 30), and another downside target at 102.00 comes next.

Meanwhile, the S&P 500 is entering a key market structure plotted between the July and March highs of 16606.75 and 4637.75. The price may hit 4780 if it can rally strongly over this resistance zone. Alternatively, the market might retreat to the 20-period moving average, which is currently around 4410, if there is a strong supply awaiting the bulls to take in.

The Nasdaq 100 tried and briefly broke over its July high in November. Although sellers have kept the market below 16,100, the market has been unable to close above this ceiling. But with sentiment improving and market dynamics becoming more optimistic, a bullish breakout might be approaching, suggesting further gains by December.

The Dow Jones Industrial Average moved within an almost horizontal trend channel, indicating continuing development in the same direction. The index has exceeded the current resistance level, signaling a favorable outlook for the medium-term trading range. The index is approaching resistance at 35600. This may cause an adverse response, but an upward breakout of points 35600 indicates a good signal.

Market Events

The US ISM Manufacturing PMI was reported at 46.7 on 1st November, which is 4.69% less than the previous month (49.0). On the same day, the Fed decided to keep the federal funds rate unchanged (5.50%). The Bank of England (BoE) also kept its official bank rate unchanged (5.25%), announced the following day.

On November 7th, the Reserve Bank of Australia decided to increase the cash rate to 4.35% (a 0.25% rise compared to the previous month). The Bureau of Labor Statistics of US reported a 0.1% decrease in Core CPI (0.2%) on November 14th, compared to 0.3% in October. Meanwhile, the US Retail Sales decreased by 0.10% (-0.1% in November vs. 0.9% in October) reported the following day.

UK Office for National Statistics announced the Retail Sales as -0.3% on November 17th, a 0.8% rise compared to October (-1.1%). On the other hand, the US CB Consumer Confidence was reported as 102.0 on November 28th, which is 2.9 points more than in October (99.1).