enDaily Analysis 11/12/2024
Latest Economic and Fundamental Insights
Dollar holds gains ahead of CPI report
The dollar index held steady around 106.3 on Wednesday, after three straight days of gains, as investors braced for a crucial U.S. inflation report that could have a major impact on Federal Reserve policy.
Gold rises to highest level in two weeks
Traders are focusing on upcoming US inflation data, which could boost expectations for a third rate cut by the Federal Reserve next week.
This move would increase the attractiveness of gold by reducing the cost of holding non-yielding assets.
-Moreover, major central banks, including the European Central Bank, the Swiss National Bank and the Bank of Canada, are expected to cut interest rates this week.
China boosted sentiment by announcing plans to adopt an appropriately easy monetary policy next year.
The yellow metal also gained momentum after the People’s Bank of China resumed gold purchases after a six-month hiatus.
Meanwhile, rising tensions in the Middle East, driven by reports of the collapse of the Syrian regime and ongoing Israeli airstrikes, have continued to boost gold’s appeal as a safe haven.
Gold holds steady amid geopolitical tensions in Middle East
Gold trades steady in early Asian trading, supported by ongoing geopolitical tensions in the Middle East. The Israeli military said Israeli missile ships destroyed naval vessels belonging to Syrian President Bashar al-Assad’s forces that were carrying dozens of naval missiles.
The power vacuum created by the collapse of the Assad-led Syrian government is raising concerns about regional stability and intensifying military operations in the region. “This increased instability has boosted demand for safe-haven assets such as gold,” says the research strategist.
Asian stock markets and the dollar took a breather on Wednesday ahead of an expected interest rate cut in Canada and a U.S. inflation reading that is expected to leave the Federal Reserve on track to cut rates again.
Oil rises on hopes of more flexible monetary policy in China, with Brent crude trading at $72.00 and WTI at $68.00.
China said on Monday it will adopt an “appropriately easy” monetary policy in 2025 as Beijing tries to stimulate its economy with its first easing of its stance in 14 years.
“Oil prices have managed to find a footing recently, as stronger policy signals from Chinese authorities have revived hopes for stronger stimulus measures in 2025,” said Yip Junrong, market strategist at IG.
“But price gains remain somewhat restrained, as market participants still want to see more concrete details beyond the typical positive messages,” Yip said.
China’s crude oil imports posted annual growth for the first time in seven months in November, up more than 14% from a year earlier.
But changes in China’s policy may not be able to offset any fallout from some of the trade measures proposed by President-elect Donald Trump, said Mukesh Sahdev, head of oil analysis at Rystad Energy.
“This (change in China’s policy) can only help prevent further downsides at best,” he added.
In the United States, crude oil and fuel inventories rose last week, market sources said Tuesday, citing figures from the American Petroleum Institute on Tuesday.
Crude inventories rose by 499,000 barrels in the week to Dec. 6, the sources said, asking not to be identified. Gasoline stocks rose by 2.85 million barrels and distillate stocks rose by 2.45 million barrels, they added.
The U.S. Energy Information Administration is due to release official data on oil inventories on Wednesday at 10:30 a.m. ET (1530 GMT). Analysts polled by Reuters expect a 900,000-barrel drop in crude and a 1.7 million-barrel gain in gasoline.
-Bitcoin price remained supported above the $94,200 area. Bitcoin is forming a base and may start a fresh rally above the $98,000 resistance level.
Smart technical reports
How they work
A likely scenario is proposed for today, and the probability of this scenario being achieved, according to technical analysis, may be between 60% and 75%.
If the first scenario fails, the probability of the second scenario being achieved will be between 60% and 75% certain.
The first scenario fails when the price reaches the level of the alternative scenario condition, and the alternative scenario is immediately activated and the prediction from the first scenario is cancelled.
These reports are not considered a substitute for the trader’s decision, but rather they are a tool to assist the follower in making his own decisions, as a reference based on the origins of classical technical analysis.
GOLD
General trend: Upward
Time interval: half an hour (30 minutes)
Current price: 2695.28
Scenario 1: Buy gold with a break and stability above 2700.02, targeting 2706.45 and then 2713.58
Alternative scenario: Sell gold with a break and stability below 2688.64 with a target price of 2682.19 and 2674.35
Comment: Trading above the supports and averages suggests an upward trend.
CRUDE OIL
Trend: Upward
Interval: Half an hour (30 minutes)
Current price: $68.75 per barrel
Scenario 1: Buy oil with a break and stability by closing a candle above the $68.95 levels, targeting $69.42 and then $69.98.
Alternative scenario: Sell oil by breaking $68.27 with a target price of $67.75 then $67.16
Comment: Trading above the supports and averages suggests an upward trend.
EURUSD
General trend: Down
Interval: Half an hour (30 minutes)
Current price: 1.05263
First scenario: Sell the EUR/USD by breaking 1.05116, targeting 1.04956 and then 1.04743.
Alternative scenario: Buy the EUR/USD with a break and hold with a candle closing above 1.05338, targeting 1.05528 and then 1.05752.
Comment: Trading below the resistances and averages suggests a decline.
GBPUSD
Trend: Dow
Interval: Half an hour (30 minutes)
Current price: 1.27687
Scenario 1: Selling the pound/dollar with a break and stability below the 1.27533 level, targeting the price of 1.27292 and then 1.27070.
Alternative scenario: Buy the pound dollar with a break and hold with a close above 1.27833, targeting 1.28074 and then 1.28360.
Comment: Trading below the resistances and averages suggests a decline.
NAS100
Trend: Upward
Interval: Half an hour (30 minutes)
Current price: 21441
Scenario 1: Buy Nasdaq with a break and hold to close above 21505 with a target price of 21608 then 21726
Alternative scenario: Sell Nasdaq with break and hold with close below 21348 with target price 21224 then 21116
Comment: Trading above the supports and averages suggests an upward trend.
Economic Calendar
(Times are in GMT+3)
-From USA Core CPI (excluding food and energy) (MoM) (November) 16:30
-From USA Consumer Price Index (YoY) (November) 16:30
-From USA Consumer Price Index (MoM) (November) 16:30
From Canada Bank of Canada Interest Rate Decision 17:45
– US Crude Oil Inventory 18:30
Fundamental Analysis
The dollar index held steady around 106.3 on Wednesday, after three straight days of gains, as investors braced for a crucial U.S. inflation report that could have a major impact on Federal Reserve policy.
A stronger-than-expected inflation reading could delay the Federal Reserve’s plans to cut borrowing costs, which could support the dollar.
However, markets currently price in an 86% chance of a 25 basis point rate cut by the Fed later this month, although the outlook for 2025 remains highly uncertain.
Traders are also closely watching interest rate decisions from the Bank of Canada and the European Central Bank this week, as both are expected to implement further rate cuts.
In addition, investors are watching developments at China’s Central Economic Work Conference, especially after Beijing recently pledged additional monetary support.
Gold rose above $2,700 an ounce on Wednesday, advancing for a third straight session to a two-week high, supported by expectations of dovish monetary policies from major central banks and increased demand for safe-haven assets.
Oil prices rose on Wednesday as market participants anticipated higher demand in the world’s largest crude importer after Beijing announced a more accommodative monetary policy to stimulate economic growth in China.
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