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EURUSD
The EUR/USD pair finished the week with losses around 1.1830, although up on Friday for a second consecutive day. Equities rallied, underpinning the demand for the shared currency, while the dollar was hit by dismal US data and the announcement of restrictive measures in some states. The preliminary estimate of the US November Michigan Consumer Sentiment Index printed at 77, below the 82 expected and the previous 81.8. Meanwhile, coronavirus outbreaks across the US has led several cities and states to announce curfews and temporal lockdowns.
The macroeconomic calendar will remain light on Monday, as no relevant data will come from Europe and the US. Instead, the market’s sentiment will likely continue seesawing between rising coronavirus cases and hopes for a vaccine/more stimulus. Also, speculative interest will be looking for fresh clues on definitions of the tumultuous US presidential election.
According to the daily chart, the EUR/USD pair is neutral-to-bullish, as it managed to hold above its 20 DMA throughout the week, while the larger moving averages advance below the shorter one. Technical indicators are around their midlines, with modest upward slopes. For the near-term, the 4-hour chart indicates that the risk is skewed to the upside, as the pair is developing above all of its moving averages, as technical indicators advance within positive levels.
Support levels: 1.1770 1.1725 1.1680
Resistance levels: 1.1840 1.1885 1.1920
USDJPY
The USD/JPY pair fell ahead of the close, ending the week with sharp losses in the 104.60 price zone. Equities advanced, and so did US Treasury yields, which usually push the pair higher. It was not the case as US consumer confidence plunged in November, according to the Michigan University. Uncertainty about the election’s result alongside coronavirus outbreaks throughout the country hit the greenback.
Japan will open the macroeconomic week by publishing the preliminary estimate of the Q3 Gross Domestic Product. The economy is expected to have grown 4.4% in the three months to September, while the annual progress is foreseen at 18.9%, recovering from -28.1% in Q2. The country will also release September Industrial Production and Capacity Utilization.
according to technical readings in the daily chart. Technical indicators have turned lower and are currently piercing their midlines, with the RSI at around 46. The price is just below a mildly bearish 20 SMA after failing to surpass the 100 DMA mid-week. In the 4-hour chart, the risk is skewed to the downside, as technical indicators head firmly lower within negative levels, as the price struggles with a flat 100 SMA.
Support levels: 104.50 104.05 103.70
Resistance levels: 104.95 105.30 105.65
GBPUSD
The GBP/USD pair is heading into the weekly opening, trading a few pips below the 1.3200 level. The greenback eased following the release of soft US data, while the pound found support on headlines indicating that a trade deal between the UK and the EU could be agreed in as soon as ten days.
However, weekend news showed that they are not closer to clinching a deal. Ireland’s Foreign Minister Simon Coveney said that the two sides are still apart on fishing rights, adding that if the UK passes the Internal Market Bill, chances of an agreement will be off. On Sunday, UK negotiator, David Frost, said that the UK will not change its stance as it seeks a post-Brexit deal with the EU. The United Kingdom has quite a scarce macroeconomic calendar this week, with nothing scheduled until Wednesday when the country will publish October inflation data.
The GBP/USD pair hit a two-month high of 1.3313 last week, retaining a modest bullish stance in the daily chart. In the mentioned time-frame, the pair is developing above all of its moving averages, which maintain their bullish slopes. The 20 DMA provides dynamic support around 1.3065. Technical indicators stand in neutral levels, aiming modestly higher. In the 4-hour chart, the bullish potential seems limited, as technical indicators corrected oversold conditions but remain within negative levels, as the price struggles to surpass a bearish 20 SMA.
Support levels: 1.3170 1.3120 1.3065
Resistance levels: 1.3220 1.3260 1.3310
AUDUSD
The AUD/USD pair finished the week as it started, trading around 0.7270. The pair was unable to attract buyers, despite a rally in equities and the broad greenback’s weakness. Investors are reluctant to push the aussie beyond the 0.7300 figure against its American rival, with gains beyond the level quickly attracting selling interest. A scarce macroeconomic calendar in Australia exacerbated range trading in the pair.
This Monday, RBA’s Governor Philip Lowe is due to deliver a speech titled "Covid, Our Changing Economy and Monetary Policy." Additionally, China will publish October Industrial Production, foreseen at 6.5%, YoY and Retail Sales for the same period, expected at 5% from 3.3% previously.
The daily chart for the AUD/USD pair provides a neutral-to-bullish bias, as it remains above all of its moving averages, although the 20 DMA and the 100 DMA continue to converge around 0.7150. Technical indicators have turned north within positive levels but lacking strength enough to confirm another leg north. In the shorter-term, and according to the 4-hour chart, the bullish potential seems limited, as the pair is struggling around a directionless 20 SMA, while technical indicators recovered from intraday lows but remain unable to surpass their midlines.
Support levels: 0.7250 0.7210 0.7170
Resistance levels: 0.7300 0.7345 0.7390
GOLD
The relief rally after the announcement made about the success of the coronavirus vaccine from Pfizer and their German partner BioNTech started to fade away. The massive move down pushed Gold to $1,860 zone but the yellow metal managed to hold the support and tried to re-gain $1,900 level. The USD index DXY ended the week at sub-93.00 levels while the US indexes tried to hold on to their gains. On the other hand, Democrat candidate Biden extended his lead after winning Arizona piercing his path to White House.
After the massive spike seen in the risk appetite, markets continue to digest the positive developments while the risk factor about the US election also fades away. The week will start with the Industrial Production and Retail Sales data from China will be watched closely by the markets on Monday. On Tuesday, Retail Sales data set will be followed while on Wednesday Housing and Building Permits will be followed in the US. On Thursday, weekly Initial Jobless Claims data will be followed in the US while on Friday PBoC interest rate decision in China.
Below the $1,860 level, the supports can be followed at $1,763 ($1,451-$2,075 61.80%) and $1,700 levels. Over the $1,860 level, the resistances can be followed at $1,900 with $1,956 ($1,451-$2,075 38.20%) and $2,000 levels.
Support Levels: $1,860 $1,763 $1,700
Resistance Levels: $1,900 $1,956 $2,000
SILVER
Silver continued to outperform Gold on Friday as markets continued to digest the vaccine developments. While Gold tried to re-gain its $1,900, Silver kept its stance over the $24.00 pushing Gold to Silver ratio to sub-77.00 level. Unlike Gold, which is a risk and inflation hedge, physical demand continues to soar for Silver as the US Mint sales continue to improve. Post-pandemic era might be still promising for Silver due to physical demand caused by the industrial factors. Therefore, Silver might hold better compared to Gold in a risk positive environment.
Below the $22.90 level ($11.63-$29.86 38.20%), the supports can be followed at $20.75 ($11.63-$29.86 50.00%) and $18.42 ($11.63-$29.86 61.80%). Over the $22.90 level, the targets up can be followed at $25.21 ($11.63-$29.86 23.60%), $26.00 (August-September support), $27.00 and $28.00 levels.
Support Levels: $22.90 $20.75 $18.42
Resistance Levels: $25.21 $26.00 $27.00
CRUDE WTI
WTI continues to retrace back as the vaccine rally continues to fade away. Demand worries caused by the second wave of the pandemic is pressuring the oil prices. Also, due to the latest data, oversupply conditions and stock build-up weighs on energy prices. In the US, Baker Hughes has reported that US oil rigs increased for the eight-consecutive week, which has failed to improve investors’ sentiment. The total count of active oil rigs increased by 10 to 236 on the week of November 6, which has contributed to increasing fears about an excess of supply. On the demand side, the IEA revised lower its demand forecast by nearly 9 MBDP for the current year earlier last week.
If WTI manages to hold over $40.56 ($65.62-$0.00 61.80%) level, the target's upside can be followed at $41.00, $46.57 (March decline start) and $50.00 levels. Below $40.00, the supports can be followed at $39.00 and $32.81 ($65.62-$0.00 50.00%) and $31.00 levels.
Support Levels: $39.00 $32.81 $31.00
Resistance Levels: $41.00 $46.57 $50.00
DOW JONES
After hitting it's all-time high last week with the developments regarding the vaccine, Dow Jones tried to protect its gains in a volatile week. While President Trump refuses Biden’s victory, Biden confirmed his victory in Arizona clinching his lead. The US states have time until December 8th to resolve the election issues. Trump’s attitude might create negative volatility in the coming weeks. On the other hand, while the second wave hit the US harder, the hope of vaccine is still highly-priced in the markets carrying the indexes higher.
The week ahead will be relatively weak in terms of macro-economic data. On Tuesday, Retail Sales data set will be followed and on Wednesday while Housing and Building Permits will be followed in the US. Finally on Thursday, weekly Initial Jobless Claims data will be the highlight of the day.
From the technical point of view, if the index stays over 29,000, 29,500 and 30,000 levels can be followed as new targets high while below the 28,400 level, 28,000 and 27,770 can be followed as supports.
Support Levels: 28,400 28,000 27,770
Resistance Levels: 29,500 30,000 30,500
MACROECONOMIC EVENTS
* All the Moving Average support and resistance levels are dynamic by nature. Means when the price approaches the Moving averages, slight variation occurs in the forecasted Moving Average support and resistance levels. Previous few days’ intraday levels are also signicant while trading the current day as the price tend to hover around these levels for some time. Levels in red indicate strong, critical or vital.
Please remember that trading financial markets carry a high degree of risk to your capital. It is possible to lose more than your initial stake. Leveraged products may not be suitable for all investors, therefore please ensure you fully understand the risks involved and seek independent advice if necessary.
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