Daily analysis from FXOpen

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Market Analysis: Price of Gold Stabilises Near Its 5-month Highs


The XAU/USD rate fluctuates around $1,987 - the July high was formed around this price. And having overcome it, the market stabilized, as evidenced by the ADX indicator, which dropped to its minimum for the month.

Gold is up about 9% in three weeks on war fears. Moreover, if we take the year 2023, then gold has become a more profitable investment than the stock market, since according to Dow Jones Market Data, as of Thursday's close, the S&P 500 SPX index has gained 7.8% since January 1, at that time as front-month gold futures gained 9.2% over the same period.

On Friday, gold traders are focused on the release of US Core PCE Price Index values at 15:30 GMT+3. News about inflation could cause significant turbulence in the gold market.



The chart shows that the upside momentum within the ascending channel is fading around the USD 1,978 level as the price moves away from the upper boundary and the median line shows signs of resistance. Although the long lower shadows at the lows of October 24-26 indicate that gold is being actively bought up on declines.

Technical support for the market can be provided by:
-> lower border of the channel;
-> level 1,958, which previously served as resistance, but has now changed its role.

The current stabilization of prices can be explained by the proximity of the psychological level of USD 2,000. News of the escalation from the Middle East could push the price beyond a round figure.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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Market Analysis: Price of Gold Stabilises Near Its 5-month Highs


The XAU/USD rate fluctuates around $1,987 - the July high was formed around this price. And having overcome it, the market stabilized, as evidenced by the ADX indicator, which dropped to its minimum for the month.

Gold is up about 9% in three weeks on war fears. Moreover, if we take the year 2023, then gold has become a more profitable investment than the stock market, since according to Dow Jones Market Data, as of Thursday's close, the S&P 500 SPX index has gained 7.8% since January 1, at that time as front-month gold futures gained 9.2% over the same period.

On Friday, gold traders are focused on the release of US Core PCE Price Index values at 15:30 GMT+3. News about inflation could cause significant turbulence in the gold market.



The chart shows that the upside momentum within the ascending channel is fading around the USD 1,978 level as the price moves away from the upper boundary and the median line shows signs of resistance. Although the long lower shadows at the lows of October 24-26 indicate that gold is being actively bought up on declines.

Technical support for the market can be provided by:
-> lower border of the channel;
-> level 1,958, which previously served as resistance, but has now changed its role.

The current stabilization of prices can be explained by the proximity of the psychological level of USD 2,000. News of the escalation from the Middle East could push the price beyond a round figure.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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Market Analysis: GBP/USD Remains At Risk While EUR/GBP Turns Green


GBP/USD started a fresh decline from the 1.2285 resistance zone. EUR/GBP is rising and might climb above the 0.8720 resistance.

Important Takeaways for GBP/USD and EUR/GBP Analysis Today

• The British Pound is showing bearish signs below the 1.2200 support.
  
• There is a key contracting triangle forming with resistance near 1.2155 on the hourly chart of GBP/USD at FXOpen.
  
• EUR/GBP is gaining pace and trading above the 0.8700 zone.
  
• There is a major contracting triangle forming with resistance near 0.8720 on the hourly chart at FXOpen.

GBP/USD Technical Analysis

On the hourly chart of GBP/USD at FXOpen, the pair attempted a fresh increase above 1.2200, as discussed in the previous analysis. However, the British Pound failed above 1.2285 and started a fresh decline against the US Dollar.

There was a clear move below 1.2200 and the 50-hour simple moving average. The bears pushed the pair 1.2155. Finally, there was a spike below the 1.2110 support zone. A low was formed near 1.2069 and the pair is now consolidating losses



There was a minor move above the 50-hour simple moving average and the 23.6% Fib retracement level of the downward move from the 1.2284 swing high to the 1.2069 low.

On the upside, the GBP/USD chart indicates that the pair is facing resistance near a key contracting triangle at 1.2155. The next major resistance is near the 61.8% Fib retracement level of the downward move from the 1.2284 swing high to the 1.2069 low at 1.2200.

A close above the 1.2200 resistance zone could open the doors for a move toward 1.2285. Any more gains might send GBP/USD toward 1.2350.

On the downside, there is a key support forming near 1.2110. If there is a downside break below the 1.2110 support, the pair could accelerate lower. The next major support is near the 1.2075 zone, below which the pair could test 1.2020. Any more losses could lead the pair toward the 1.2000 support.



This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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USD/JPY Analysis: Playing with Fire Continues


Yesterday, the Nikkei newspaper reported that the Bank of Japan is considering adjusting its yield curve control (YCC) policy.



This provoked a strengthening of the yen (1). The USD/JPY rate dropped to a two-week extreme of 148.8 per US dollar in anticipation of news from the Bank of Japan.

The news followed this morning (2). The Bank of Japan kept interest rates at -0.1% and also said the 1% ceiling on the benchmark 10-year yield would be an upper bound rather than a hard limit.

As a result of the Bank's decision, the USD/JPY rate returned to the area above 150 yen per US dollar.

Wherein:

the price formed a false breakout of the ascending channel (shown in blue). The decline to the level of USD 149 formed a trap for the bears, who are forced to come out of losses today, thereby pushing USD/JPY even higher;
if the momentum continues, the price may reach the channel median line.

Thus, the upward trend may develop, the main danger for which will be (usually unexpected) statements by officials from the Ministry of Finance and/or the Bank of Japan, which could provoke sharp fluctuations like what has happened in recent days.


This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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USD/CAD Analysis: New High of the Year


As the chart shows, yesterday, the USD/CAD rate exceeded 1.389 for the first time in 2023. This happened against the backdrop of news regarding the economies of the USA and Canada:

-> Statistics Canada estimates that GDP contracted in the third quarter. Technically, it can be stated that the Canadian economy has entered a technical recession, as this is the second consecutive negative change in GDP for the quarter.
-> The US Employment Cost Index rose 1.1% in the third quarter after rising 1.0% in the second quarter, the Labour Department reported Tuesday. This is a sign of a strong labour market, but at the same time, it indicates the preconditions for rising inflation, since the costs to the employer may fall on the consumer.

How the Fed assesses inflation will become known today at 21:30 GMT+3 from Powell’s speech. Also, volatility in the USD/CAD market may increase the speech of Bank of Canada Governor Tiff Macklem at 23:15 GMT+3.



The chart shows that the USD/CAD rate is in an upward trend because:
-> exchange rate dynamics develop within the channel shown in blue - the strength of the USD relative to the CAD suggests that the US economy is in a stronger state than the Canadian one;
-> the magnitude of the B-C rollback is about 50% of the growth progress of A-B.

Since the USD/CAD price is near the upper boundary of the channel, this means that the market is vulnerable to a pullback. This probability is also indicated by potential price divergence with the RSI indicator.

If a rollback occurs, it may be shallow, for example, to the support zone formed by the median line of the blue channel and the level of 1.375, which previously served as an important resistance.

Be prepared for a spike in volatility tonight.



This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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S&P 500 Analysis: Powell Adds Bullish Momentum


As expected, the Fed left the rate unchanged. Market participants' attention was focused on Powell's press conference, as he said:
-> Risks have now become almost balanced;
-> Inflation expectations are at a good level.

The media publishes the opinions of experts who generally agree that although Jerome Powell has not ruled out the possibility of another rate increase, he does not seem to be very supportive of this idea. So the Fed is not as aggressive as it could be.

As a result, the probability of a rate hike in December has dropped to 20%, and the probability that the rate hike cycle has ended is at 70%.



The S&P 500 stock index reacted positively - the price rose at the end of trading. However, how long will the bullish momentum based on Powell's words last?

The graph shows that:
-> the price of the S&P 500 is still in a downward trend, judging by the channel (shown in red), and the upper limit of the channel, where we should expect the bears to intensify their efforts, is already close;
-> the price has risen to the important technical level 4,266, which has repeatedly affected it -perhaps now it will provide resistance;
-> tapering bullish candles late yesterday indicate that buyer activity may be drying up.

Today, as we note, a report on the activities of Apple, the largest company by capitalization, will be released. If it turns out to be worse than expected (for example, due to the dynamics of sales of the 15th iPhone), then the positivity from Powell’s words can be significantly (if not completely) won back by the bears.


This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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Market Analysis: AUD/USD and NZD/USD Show Signs of Life


AUD/USD is moving higher and might climb above 0.6450. NZD/USD is also rising and could extend its increase above the 0.5915 resistance zone.

Important Takeaways for AUD USD and NZD USD Analysis Today

• The Aussie Dollar started a fresh increase above the 0.6350 and 0.6400 levels against the US Dollar.
  
• There is a connecting bullish trend line forming with support near 0.6425 on the hourly chart of AUD/USD at FXOpen.
  
• NZD/USD is gaining bullish momentum above the 0.5870 support.
  
• There is a short-term contracting triangle forming with support near 0.5885 on the hourly chart of NZD/USD at FXOpen.

AUD/USD Technical Analysis

On the hourly chart of AUD/USD at FXOpen, the pair started a fresh increase from the 0.6320 support. The Aussie Dollar was able to clear the 0.6350 resistance to move into a positive zone against the US Dollar.

There was a close above the 0.6400 resistance and the 50-hour simple moving average. Finally, the pair tested the 0.6455 zone. A high is formed near 0.6456 and the pair is now consolidating gains.



On the downside, initial support is near the 23.6% Fib retracement level of the upward move from the 0.6318 swing low to the 0.6456 high at 0.6425. There is also a connecting bullish trend line forming with support near the same zone.

The next support could be the 50-hour simple moving average at 0.6400. If there is a downside break below the 0.6400 support, the pair could extend its decline toward the 76.4% Fib retracement level of the upward move from the 0.6318 swing low to the 0.6456 high at 0.6350.

Any more losses might signal a move toward 0.6320. On the upside, the AUD/USD chart indicates that the pair is now facing resistance near 0.6455.

The first major resistance might be 0.6480. An upside break above the 0.6480 resistance might send the pair further higher. The next major resistance is near the 0.6550 level. Any more gains could clear the path for a move toward the 0.6620 resistance zone.


This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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S&P 500 Analysis: Best Week of the Year, Despite Bad News from Labour Market


According to Friday's data, in the US:
-> the unemployment rate rose to 3.9% (expected = 3.8%). The last time the level was this high was in February 2022.
-> the number of workers employed in the non-agricultural sector increased over the month by only 150k (+178k expected). The last time the figure was below 150k was in February 2021.

Published negative data clearly indicate a cooling of the labour market. Why then did the E-mini S&P-500 futures price end the week up about 5.5%, marking the best week of 2023?

The point is that market participants are increasingly convinced that the Fed will no longer tighten monetary policy. That is, interest rates have peaked, the next step should be to ease them, which will allow companies to grow.



The 4-hour chart of the S&P 500 shows that the index price:
-> has reached the upper border of the descending channel, above which there is a resistance line from the October highs;
-> the RSI indicates severe overbought.

That is, the market is in a vulnerable position for the formation of a rollback from current price levels. If the price goes into a pullback, it will be an important test for the current positive interpretations of statistical data - is rising unemployment really a good thing for the stock market?



This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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Market Analysis: GBP/USD Turns Green While USD/CAD Eyes Fresh Increase


GBP/USD started a decent increase above the 1.2225 resistance. USD/CAD is recovering and might aim for a move toward the 1.3795 resistance.


Important Takeaways for GBP/USD and USD/CAD Analysis Today

• The British Pound climbed above the 1.2225 and 1.2315 resistance levels.
  
• There is a connecting bullish trend line forming with support near 1.2315 on the hourly chart of GBP/USD at FXOpen.
  
• USD/CAD declined toward the 1.3635 zone before the bulls took a stand.
  
• It broke a major bearish trend line with resistance near 1.3660 on the hourly chart at FXOpen.

GBP/USD Technical Analysis



On the hourly chart of GBP/USD at FXOpen, the pair found support near the 1.2100 zone. The British Pound formed a base and started a recovery wave above 1.2225 against the US Dollar.

The pair was able to clear the 1.2315 resistance and the 50-hour simple moving average. Finally, it spiked toward 1.2430. A high is formed near 1.2430 and the pair is now correcting gains. There was a move below the 23.6% Fib retracement level of the upward move from the 1.2097 swing low to the 1.2428 high.

The RSI moved below the 40 level on the GBP/USD chart and the pair is now approaching a major support at 1.2315. There is also a connecting bullish trend line forming with support near 1.2315.

A downside break below the trend line might send the pair toward the 61.8% Fib retracement level of the upward move from the 1.2097 swing low to the 1.2428 high at 1.2225. The next major support is 1.2100. Any more losses might call for a test of the 1.2000 support.

On the upside, the pair might face resistance near 1.2350. The next resistance is near 1.2385. An upside break above the 1.2385 zone could send the pair toward 1.2430. Any more gains might open the doors for a test of 1.2500.



This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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Market Analysis: Oil Prices Fall to Lowest Level since July


As the chart shows, the price of WTI oil has dropped below USD 77.50 - the last time prices were this high was in mid-July.

The decline in oil prices was contributed to by:

-> first, easing concerns about the escalation of the military conflict in the Middle East and interruptions in the supply of oil produced in the region;
-> secondly, the data from Beijing. While China's crude oil imports rose in volume and value in October, the country's total exports fell 6.4% year on year, more than expected, CNBC reports. This points to a slowdown in demand in a world where central banks in many countries are keeping interest rates high to combat inflation.

Thus, supply forces prevail despite the fact that Russia and Saudi Arabia announced continued restrictions on oil production amid the conflict in the Middle East.



The oil price chart today shows that:

-> the market is oversold, judging by the RSI indicator;
-> the price is near the lower border of the downward channel.

Therefore, the market is vulnerable to some price recovery from the oversold zone. If this happens, the price will form a false breakout of the August lows and could then test the USD 80.00 level. It is possible that this psychological level, which provided support on November 1-3 after yesterday's bearish breakout, will act as resistance -similar to what happened with the USD 82.50 level.


This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.