Article by: ETO Markets
The Japanese yen extended its downward trend for the second day in a row, giving up some of its recent substantial gains versus the US dollar. Better-than-expected US job market data and an increase in consumer inflation expectations helped the USD pull away from its lowest level since late August against the backdrop of Tuesday's hawkish FOMC minutes. As a result, the USD/JPY pair was able to continue its strong rebound from the 147.15 region, or from a two-month low that was struck on Tuesday.
US Jobless Claims data released on Wednesday showed a greater-than-expected decline in Initial Claims for the week ending on November 17, falling from 233K to 209K. Furthermore, October's Durable Goods Orders fell 5.4% as opposed to the projected 3.1%, which was a bigger decrease than anticipated. The University of Michigan Consumer Sentiment Index for November, however, beat forecasts and came in at 61.3 rather than 60.5.
On Thursday, the UK's preliminary S&P Global / CIPS Purchasing Managers Index data for November will be made public. Additionally, Thanksgiving Day, US markets will be closed. The preliminary S&P Global Manufacturing and Services PMI for November will be released in the US on Friday; a drop is anticipated.
The largest oil exporter in the world, Saudi Arabia, intends to continue reducing oil output by one million barrels per day until the end of the year, and other OPEC+ members are also thinking about reducing production in reaction to falling oil prices. The market climate, however, was challenging for the next conference due to escalating tensions over the Israel-Hamas conflict and a slower-than-anticipated rebound in Chinese demand.
After rising sharply on Tuesday and getting close to the crucial $2,010 resistance zone, spot gold fell down. The fall continued into the American session, suggesting that there could be further downside, if it happens gradually for the time being. There is still bullish potential underneath the yellow metal. US data revealed a drop in both initial and continuing claims as well as a bigger-than-expected dip in durable goods orders in October.
Technical indicators have shifted south, although XAU/USD is still above an upward trendline on the 4-hour chart. Bearish signs are even being given by the MACD, as the RSI is still declining from over 70. At $…, the 20-SMA has provided support for gold thus far. In order to prevent a more serious deterioration in the outlook, a loss below this level would enhance the negative pressure and expose the $… region as well as a short-term rising trendline that should hold. Another approach to the $… barrier might take place if the price bounces back to $...
The largest oil exporter in the world, Saudi Arabia, intends to continue reducing oil output by one million barrels per day until the end of the year, and other OPEC+ members are also thinking about reducing production in reaction to falling oil prices. The market climate, however, was challenging for the next conference due to escalating tensions over the Israel-Hamas conflict and a slower-than-anticipated rebound in Chinese demand.
The WTI's Wednesday dip dropped US Crude Oil momentarily fell below $… before it pared away much of the day's losses to retest the $… mark. Crude Oil has a history of abrupt chart decreases. Even with the late-day bounce on Wednesday, WTI is still trading near the 200-DMA, indicating strong selling pressure. WTI is currently trading at a five-month low of roughly $…, and last week's peak, which was just below $…, will be the immediate ceiling.
