Aussie and Kiwi on the rise
NZDUSD reached a 2-year high of 0.6961 after the release of solid retail sales data. The area of 0.68-0.70 has been an important area of a tug-of-war between bulls and bears for the last five years. The pair’s ability to reach above 0.70 sustainably opens up a growth potential of 0.74-0.75 – the area of its peak in 2016-2018. New Zealand avoided a second coronavirus wave, recording single cases of new infections and a total of 2030 (1953 cured). Thus, the economic damage to the economy promises to be minimal.
This is roughly the same in Australia, which has consistently enjoyed strong business data. In addition to the very strong employment growth data published last week, strong reports on the manufacturing and service have been added. AUDUSD is trampling around 0.73. It is also in an area of peaks in the last two years.
https://fxpro.news/daily-forex-outlook/economic-optimism-causes-dollar-retreat-20201123/
NZDUSD reached a 2-year high of 0.6961 after the release of solid retail sales data. The area of 0.68-0.70 has been an important area of a tug-of-war between bulls and bears for the last five years. The pair’s ability to reach above 0.70 sustainably opens up a growth potential of 0.74-0.75 – the area of its peak in 2016-2018. New Zealand avoided a second coronavirus wave, recording single cases of new infections and a total of 2030 (1953 cured). Thus, the economic damage to the economy promises to be minimal.
This is roughly the same in Australia, which has consistently enjoyed strong business data. In addition to the very strong employment growth data published last week, strong reports on the manufacturing and service have been added. AUDUSD is trampling around 0.73. It is also in an area of peaks in the last two years.
https://fxpro.news/daily-forex-outlook/economic-optimism-causes-dollar-retreat-20201123/
The data from the US today came as a pleasant surprise to the dollar. Preliminary PMI numbers showed an increase in the composite index from 56.3 to 57.9 against an expected drop to 54.5. Both the manufacturing and service sector activity component exceeded expectations and increased markedly from last month. This contrasts sharply with US records for daily illness, death and new lockdowns measures.
On the contrary, earlier today, European estimates were surprisingly weak. The Composite Index collapsed from 50 to 45.1.
The PMI is a significant driver for the movement of the currency and stock markets in times of high uncertainty, as it is an excellent indicator of turning points in the economy. In this case, the sharp contrast in data from Europe and the US was clearly in favour of a decline of the euro against the dollar, as we see in the first minutes after publication, EURUSD is once again not rising above 1.1900.
On the contrary, earlier today, European estimates were surprisingly weak. The Composite Index collapsed from 50 to 45.1.
The PMI is a significant driver for the movement of the currency and stock markets in times of high uncertainty, as it is an excellent indicator of turning points in the economy. In this case, the sharp contrast in data from Europe and the US was clearly in favour of a decline of the euro against the dollar, as we see in the first minutes after publication, EURUSD is once again not rising above 1.1900.
Thanksgiving Day: trading time schedule changes
On November 26, 2020, America will celebrate Thanksgiving Day. Therefore, trading time schedule of several financial classes will be changed on November 26 and 27.
The following instruments will be affected:
- Agricultural Commodity Futures
- Energy Futures
- Indices Futures
- Spot Indices
- Spot Energies
- Spot Metals
- US Shares
Find all the details in our Market Holidays calendar: https://www.fxpro.com/trading-tools/market-holidays
If you have any questions, feel free to contact the FxPro Customer support team via email support@fxpro.com.
On November 26, 2020, America will celebrate Thanksgiving Day. Therefore, trading time schedule of several financial classes will be changed on November 26 and 27.
The following instruments will be affected:
- Agricultural Commodity Futures
- Energy Futures
- Indices Futures
- Spot Indices
- Spot Energies
- Spot Metals
- US Shares
Find all the details in our Market Holidays calendar: https://www.fxpro.com/trading-tools/market-holidays
If you have any questions, feel free to contact the FxPro Customer support team via email support@fxpro.com.
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Dollar secured a major level vs euro
Overnight, EURUSD once again failed to overcome 1.19. As in numerous times over the last three months, the bear attack from this level was powerful, leading the pair below 1.18 in a matter of hours. The momentum of the dollar’s appreciation was short-lived, as it was due to strong data rather than the markets fleeing to safe-assets. Soon after, investors switched to buying risk assets and related currencies.
EURUSD had already reversed half of yesterday’s rollback by Tuesday morning, trading at 1.1850. The recovery in demand for risk assets often plays against the dollar, forcing it to retreat even against the euro. Thus, the dollar has received local support from an important level to the euro but continues to retreat on other fronts. Therefore, the rebound of the dollar index from the 2-year low area risks being short-lived.
https://fxpro.news/daily-forex-outlook/dollar-secured-a-major-level-vs-euro-but-retreats-against-other-instruments-20201124/
Overnight, EURUSD once again failed to overcome 1.19. As in numerous times over the last three months, the bear attack from this level was powerful, leading the pair below 1.18 in a matter of hours. The momentum of the dollar’s appreciation was short-lived, as it was due to strong data rather than the markets fleeing to safe-assets. Soon after, investors switched to buying risk assets and related currencies.
EURUSD had already reversed half of yesterday’s rollback by Tuesday morning, trading at 1.1850. The recovery in demand for risk assets often plays against the dollar, forcing it to retreat even against the euro. Thus, the dollar has received local support from an important level to the euro but continues to retreat on other fronts. Therefore, the rebound of the dollar index from the 2-year low area risks being short-lived.
https://fxpro.news/daily-forex-outlook/dollar-secured-a-major-level-vs-euro-but-retreats-against-other-instruments-20201124/
Gold has fallen out of the trading range of the last 4.5 months, trading at $1830. By contrast, oil has soared to highs since March. Brent traded at $46.50, again testing the highs of August and earlier in the morning touched the highest values since March at $46.66. WTI has similar dynamics, rising to $43.50.
The recovery in oil quotes is fuelling strong demand for stocks of raw materials and energy companies, which added 4%-15% yesterday while continuing Crude Oil growth pushes them even higher today.
https://fxpro.news/daily-forex-outlook/dollar-secured-a-major-level-vs-euro-but-retreats-against-other-instruments-20201124/
The recovery in oil quotes is fuelling strong demand for stocks of raw materials and energy companies, which added 4%-15% yesterday while continuing Crude Oil growth pushes them even higher today.
https://fxpro.news/daily-forex-outlook/dollar-secured-a-major-level-vs-euro-but-retreats-against-other-instruments-20201124/
Recently, there seems to be an intensified struggle between Europe and the USA for whose macroeconomic performance will more strongly exceed expectations. Yesterday it was the USA and today, it is Germany’s turn.
Germany's GDP recovery in Q3 was 8.5%, reducing its annual decline to 3.9%, according to a final estimate (no revision from +8.2% was expected). A little later, the Ifo Business Environment Index came out at 90.7 in November, showing a smaller decline than predicted and causing the euro to rise within reach of 1.19.
This tug-of-war continues to play into the hands of commodities and stock markets, where futures on the Dow are again just shy of 30,000.
Gold is the main victim of this optimism. The price per ounce has fallen below $1810 (-1.5%), to its lowest level since late July.
Germany's GDP recovery in Q3 was 8.5%, reducing its annual decline to 3.9%, according to a final estimate (no revision from +8.2% was expected). A little later, the Ifo Business Environment Index came out at 90.7 in November, showing a smaller decline than predicted and causing the euro to rise within reach of 1.19.
This tug-of-war continues to play into the hands of commodities and stock markets, where futures on the Dow are again just shy of 30,000.
Gold is the main victim of this optimism. The price per ounce has fallen below $1810 (-1.5%), to its lowest level since late July.
Brent Crude grew to $46.50, to 7-months top. Will the rally continue?
Anonymous Poll
60%
BUY
40%
SELL
#WaveAnalysis
#Gold broke support zone
• Likely to fall to $1763
https://fxpro.news/market-snapshots/gold-wave-analysis-24-november-2020-20201124/
#Gold broke support zone
• Likely to fall to $1763
https://fxpro.news/market-snapshots/gold-wave-analysis-24-november-2020-20201124/
Dow Jones managed to close above 30,000 for the first time in history, Nasdaq climbed above 12,000 and S&P 500 closed above 3,600 on Tuesday.
The dynamics of other markets are still indicating that the growth momentum of the markets will continue for now.
This morning, Brent reached $48.6. These are the highs from the 6th March, before the US and European lockdowns. So, in this case, we can say that oil has managed to escape the coronavirus corridor.
EURUSD is again flirting with 1.19 and GBPUSD with 1.3350.
Since the beginning of November, purchases in these pairs have been starting from increasingly higher levels. Although the growth impulses have previously rested on resistance, the sequence of shallow pullbacks is more likely to happen sooner rather than later. This is also an argument in favour of maintaining the momentum of buying risky assets.
https://fxpro.news/daily-forex-outlook/crude-oil-and-fx-setting-the-stage-for-further-stocks-growth-20201125/
The dynamics of other markets are still indicating that the growth momentum of the markets will continue for now.
This morning, Brent reached $48.6. These are the highs from the 6th March, before the US and European lockdowns. So, in this case, we can say that oil has managed to escape the coronavirus corridor.
EURUSD is again flirting with 1.19 and GBPUSD with 1.3350.
Since the beginning of November, purchases in these pairs have been starting from increasingly higher levels. Although the growth impulses have previously rested on resistance, the sequence of shallow pullbacks is more likely to happen sooner rather than later. This is also an argument in favour of maintaining the momentum of buying risky assets.
https://fxpro.news/daily-forex-outlook/crude-oil-and-fx-setting-the-stage-for-further-stocks-growth-20201125/
The price of gold fell yesterday close to $1800, where a 200-day moving average is now situated. The recovery in market optimism has washed away the demand for gold as a refuge for capital during stock market turbulence.
This weakening of gold may be short-lived, as interest in gold is fuelled both by rising commodity market prices and abundant liquidity at extremely low government bond yields.
This weakening of gold may be short-lived, as interest in gold is fuelled both by rising commodity market prices and abundant liquidity at extremely low government bond yields.
US labour market recovery unfolds
The US Initial claims number has been increasing for the second consecutive week, with a recent report showing 778K for the week to November 21 vs 748K a week earlier and expectations of a decline to 732K. The upward turn in this indicator threatens the sustainability of data improvement in response to record US morbidity rates.
Deterioration in weekly operational data also threatens the sustainability of the recovery, as we saw in previous monthly indicators.
The total number of claims fell to 6.071M in the week to November 14 (-299K), but the maintenance of the downward trend is at risk amid initial claims continuing to rise.
Traders should bear in mind that the number of continued claims is now 3.5 times higher than before the pandemic. Suspending the return to normal may suppress the recent market optimism, or pause it until the NFP reports are published at the end of next week and contain the retreat of the dollar.
The US Initial claims number has been increasing for the second consecutive week, with a recent report showing 778K for the week to November 21 vs 748K a week earlier and expectations of a decline to 732K. The upward turn in this indicator threatens the sustainability of data improvement in response to record US morbidity rates.
Deterioration in weekly operational data also threatens the sustainability of the recovery, as we saw in previous monthly indicators.
The total number of claims fell to 6.071M in the week to November 14 (-299K), but the maintenance of the downward trend is at risk amid initial claims continuing to rise.
Traders should bear in mind that the number of continued claims is now 3.5 times higher than before the pandemic. Suspending the return to normal may suppress the recent market optimism, or pause it until the NFP reports are published at the end of next week and contain the retreat of the dollar.
The easiest part of Oil’s recovery may be over
Brent’s growth momentum yesterday and the renewal of highs since March are attributed to an unexpected decline in US oil reserves, contrary to forecasts of growth.
The increase in price by one third in November risks turning into massive profit-taking at the end of the month with potential targets on $46 or even $44, depending on the depth of correction. The psychologically important level of $50 probably won’t give up without a fight.
https://fxpro.news/market-snapshots/the-easiest-part-of-oils-recovery-may-be-over-20201126/
Brent’s growth momentum yesterday and the renewal of highs since March are attributed to an unexpected decline in US oil reserves, contrary to forecasts of growth.
The increase in price by one third in November risks turning into massive profit-taking at the end of the month with potential targets on $46 or even $44, depending on the depth of correction. The psychologically important level of $50 probably won’t give up without a fight.
https://fxpro.news/market-snapshots/the-easiest-part-of-oils-recovery-may-be-over-20201126/
U.S. markets are closed for Thanksgiving today, and not much data has been published. Among the important data is the publication of the German consumer climate index from GfK, which fell by December to -6.7 vs -3.2 a month earlier and expectations of a decline to -4.9.
A sharp deterioration in consumer confidence was a new obstacle for EURUSD growth, leaving it at 12-week highs and then returning below 1.19.
The new partial lockdown significantly dampens consumer sentiment in Germany. The graph clearly shows how negatively coronavirus restrictions have affected consumer confidence. By a wide margin, the index was not so low during the global financial crisis and its aftermath, when the German economy lost 8% YoY.
The drop in consumer confidence in the USA wasn’t so sharp, falling only to 5-year lows. The latest estimates, earlier in the week, showed a decline, but not as deep.
A sharp deterioration in consumer confidence was a new obstacle for EURUSD growth, leaving it at 12-week highs and then returning below 1.19.
The new partial lockdown significantly dampens consumer sentiment in Germany. The graph clearly shows how negatively coronavirus restrictions have affected consumer confidence. By a wide margin, the index was not so low during the global financial crisis and its aftermath, when the German economy lost 8% YoY.
The drop in consumer confidence in the USA wasn’t so sharp, falling only to 5-year lows. The latest estimates, earlier in the week, showed a decline, but not as deep.
NZD & AUD adding on fast recovery and hopes for further BoJ’s QE
The Australian dollar trades at 0.7370 on Friday morning, which is the peak area for the end of August 2020 and December 2018. It has been adding more than 5.2% since the beginning of the month. Growth above 0.7400 will be an exit into the area of more than two-year highs and will cross out the slump of the China-US trade wars.
The New Zealand dollar crossed 0.7000 this week and is at 29-month highs, adding more than 6.2% this month.
These currencies are in demand from investors in Japan, a country with chronically low-interest rates. This morning, this interest may have been further fuelled by weak macroeconomic data. Prices in Tokyo increased the decline in November to -0.7% YoY, compared to -0.3% a month earlier.
https://fxpro.news/daily-forex-outlook/nzd-aud-adding-on-fast-recovery-and-hopes-for-further-bojs-qe-20201127/
The Australian dollar trades at 0.7370 on Friday morning, which is the peak area for the end of August 2020 and December 2018. It has been adding more than 5.2% since the beginning of the month. Growth above 0.7400 will be an exit into the area of more than two-year highs and will cross out the slump of the China-US trade wars.
The New Zealand dollar crossed 0.7000 this week and is at 29-month highs, adding more than 6.2% this month.
These currencies are in demand from investors in Japan, a country with chronically low-interest rates. This morning, this interest may have been further fuelled by weak macroeconomic data. Prices in Tokyo increased the decline in November to -0.7% YoY, compared to -0.3% a month earlier.
https://fxpro.news/daily-forex-outlook/nzd-aud-adding-on-fast-recovery-and-hopes-for-further-bojs-qe-20201127/
#WaveAnalysis
#Silver broke key support level 22.80
• Likely to fall to 21.65
https://fxpro.news/market-snapshots/silver-wave-analysis-27-november-2020-20201127/
#Silver broke key support level 22.80
• Likely to fall to 21.65
https://fxpro.news/market-snapshots/silver-wave-analysis-27-november-2020-20201127/
#WaveAnalysis
#AUDUSD approaching key resistance level 0.7410
• Likely to rise to 0.7600
https://fxpro.news/market-snapshots/audusd-wave-analysis-27-november-2020-20201127/
#AUDUSD approaching key resistance level 0.7410
• Likely to rise to 0.7600
https://fxpro.news/market-snapshots/audusd-wave-analysis-27-november-2020-20201127/
Stock markets: is the glass half-empty or half-full?
The markets are altering slightly at the beginning of the week, but this is unlikely to override the previous achievements of this month. Partly due to the effect of a low base after the drop at the end of last month, the MSCI World Global Markets Index has increased 13% in November, the strongest monthly growth in the index’s history.
Interestingly, the slight weakening in equities is not observed by all markets. European currencies are developing an upward trend against the dollar. EURUSD extends its invasion in the area of 3-month peaks above 1.1970. The bulls are targeting the test of 1.2000.
https://fxpro.news/daily-forex-outlook/stock-markets-is-the-glass-half-empty-or-half-full-20201130/
The markets are altering slightly at the beginning of the week, but this is unlikely to override the previous achievements of this month. Partly due to the effect of a low base after the drop at the end of last month, the MSCI World Global Markets Index has increased 13% in November, the strongest monthly growth in the index’s history.
Interestingly, the slight weakening in equities is not observed by all markets. European currencies are developing an upward trend against the dollar. EURUSD extends its invasion in the area of 3-month peaks above 1.1970. The bulls are targeting the test of 1.2000.
https://fxpro.news/daily-forex-outlook/stock-markets-is-the-glass-half-empty-or-half-full-20201130/
Gold at the beginning of the week is developing a decline, which also indicates a reversal of the trend of recent months. The precious metal corrects the two-year upward trend that started in August-October 2018 from a level of $1180 to a record $2000.
Today’s shift in stock market sentiment has not brought buyers back to gold, which fell to $1765, setting the tone for the temporary nature of the share drawdown.
The situation with oil is even more complicated. Despite 2.5 year lows of the dollar index, Brent has been losing more than 1% since the beginning of the day, rolling back after the peaks touched in the middle of last week.
https://fxpro.news/daily-forex-outlook/stock-markets-is-the-glass-half-empty-or-half-full-20201130/
Today’s shift in stock market sentiment has not brought buyers back to gold, which fell to $1765, setting the tone for the temporary nature of the share drawdown.
The situation with oil is even more complicated. Despite 2.5 year lows of the dollar index, Brent has been losing more than 1% since the beginning of the day, rolling back after the peaks touched in the middle of last week.
https://fxpro.news/daily-forex-outlook/stock-markets-is-the-glass-half-empty-or-half-full-20201130/