2024-11-29 11:55

The dollar ended the week down as US markets remained closed for the Thanksgiving holiday. ECB’s Fracois Villeroy said the central bank should implement a bigger rate cut. Data on Thursday showed a 0.2% decline in price pressures in Germany. The EUR/USD price analysis indicates continued euro strength as the dollar eases due to an increasing chance of a Fed rate cut in December. Nevertheless, the euro is heading for a bearish month, having lost 2.8% of its value mainly due to Trump’s win. –Are you interested to learn more about forex options trading? Check our detailed guide- The dollar ended the week down as US markets remained closed for the Thanksgiving holiday, keeping trading thin. Moreover, US inflation figures on Wednesday revealed an expected increase, solidifying bets for a December Fed rate cut. However, market participants are still waiting for more data before the meeting to gauge whether policymakers will vote to lower borrowing costs. The next major economic report will be the nonfarm payrolls, due next week. Meanwhile, the euro soared to a one-week high after hawkish ECB remarks on Wednesday. Isabel Schnabel said the central bank should consider a gradual pace for rate cuts. However, on Thursday, ECB’s Fracois Villeroy said the central bank should implement a bigger rate cut at next month’s meeting. Nevertheless, the euro remained steady due to dollar’s weakness. The Eurozone economy has deteriorated faster than most major economies, putting pressure on the European Central Bank to cut interest rates. At the same time, inflation has eased, with data on Thursday showing a 0.2% decline in price pressures in Germany. Increasing rate cut bets and Trump’s tariff threats have weighed on the euro in November. The currency has lost nearly 2.8% of its value. If these factors remain in play, the downtrend will continue next month. EUR/USD key events today There won’t be any key economic reports from the Eurozone or the US today. EUR/USD technical price analysis: Bulls losing enthusiasm On the technical side, the EUR/USD price has maintained its position above the 30-SMA, indicating a bullish bias. At the same time, the RSI trades above 50, in bullish territory. However, price action shows that bulls are struggling to detach from the SMA and the 1.0500 key level. Therefore, EUR/USD might consolidate at this level before either climbing towards the 1.0700 resistance or breaking below 1.0500. https://www.forexcrunch.com/blog/2024/11/29/eur-usd-price-analysis-fed-rate-cut-odds-weigh-on-dollar/

2024-11-29 09:04

Data revealed that Tokyo’s core CPI increased by 2.2% in November. Market participants are pricing a 57% chance of a BoJ rate hike in December. The dollar was frail on Friday amid the Thanksgiving holiday. The USD/JPY outlook shows the yen nears a six-week high after hotter-than-expected Tokyo inflation figures. At the same time, the dollar remained fragile with the ongoing Thanksgiving holiday. –Are you interested to learn more about forex options trading? Check our detailed guide- The yen rallied on Friday and was heading for a 3% gain this week as markets raised the likelihood of a Bank of Japan rate hike in December. Data revealed that Tokyo’s core CPI increased by 2.2% in November, above forecasts of 2.1%. Moreover, it was a big increase from the previous month when inflation rose by 1.8%. The surge in price pressures brightened the outlook for the yen as the BoJ will be more willing to hike interest rates. Consequently, market participants are pricing a 57% chance of a rate hike in December. The yen has suffered since Trump won the US election. Initially, Japan’s currency had recovered at the prospect of an aggressive Fed rate cutting cycle. However, that outlook has shifted significantly, with markets now pricing a gradual pace next year. Therefore, there is more pressure on the Bank of Japan to do something to support its currency. On the other hand, the dollar was frail on Friday amid the Thanksgiving holiday. At the same time, traders are more convinced the Fed will cut rates in December after inflation figures on Wednesday came in line with expectations. The next major report will show the state of the labor market, further shaping the outlook for Fed rate cuts. USD/JPY key events today Market participants do not expect any key reports from Japan or the US. Therefore, traders will keep absorbing Japan’s inflation figures. USD/JPY technical outlook: 150.02 support looks vulnerable On the technical side, the USD/JPY price has dipped below the 150.02 support before pulling back above the level. The price trades well below the 30-SMA, with the RSI in the oversold region, indicating a strong bearish bias. Bears made a sharp decline after the price retested the 151.74 level as resistance. They are now facing the 150.02 support level. A break below this level will continue the downtrend with a new low. However, the price might pull back to retest the 30-SMA before making new lows. https://www.forexcrunch.com/blog/2024/11/29/usd-jpy-outlook-tokyo-inflation-bolsters-yen-to-6-week-high/

2024-11-28 10:50

ECB’s Isabel Schnabel said on Wednesday that the central bank should cut rates gradually. Market participants are anticipating the German inflation report. US inflation increased by 0.3%. The EUR/USD outlook shows a slight pullback following a sharp bullish turn after hawkish European Central Bank remarks boosted the euro. However, trading remained thin as the US observed the Thanksgiving holiday. –Are you interested to learn more about forex options trading? Check our detailed guide- ECB’s Isabel Schnabel said on Wednesday that the central bank should cut rates gradually and not aggressively. According to her, lowering borrowing costs to spur economic growth will not solve the Eurozone’s deep structural issues. Moreover, Isabel added that she did not see a recession in the future, giving the central bank enough room to hold rates at restrictive levels. Meanwhile, market participants are anticipating the German inflation report, which will give more clues on ECB rate cuts. Markets expect policymakers to cut rates at the next few meetings in order to support the fragile economy. On the other hand, the greenback remained frail after economic data in the previous session solidified bets for a December Fed rate cut. The core PCE inflation report revealed that inflation increased by 0.3%, meeting forecasts. Meanwhile, the US economy expanded by 2.8% as expected. A separate report showed that initial jobless claims eased slightly from 215,000 to 213,000. The dollar had initially rallied after Trump promised to impose tariffs on China, Canada, and Mexico. Market participants are looking forward to Trump’s new administration, which will take office in January. The looming policy changes threaten to shift the outlook for economic growth, inflation, and monetary policy. While these changes will likely support the dollar, they might hurt the Eurozone economy and the euro. EUR/USD key events today German Prelim CPI m/m EUR/USD technical outlook: Bulls take control above 1.0500 key level On the technical side, the EUR/USD price has broken above the 1.0500 key level and the 30-SMA, showing a bullish reversal. At the same time, the RSI now trades above 50, indicating strong bullish momentum. After consolidating below the SMA, the price has finally broken above with strong candles. However, it is currently pulling back to retest the 30-SMA and the 1.0500 level as support. If bulls remain in the lead, the price will bounce high and aim for the 1.0700 resistance level. Otherwise, it will break back below the SMA to target the 1.0301 support level. https://www.forexcrunch.com/blog/2024/11/28/eur-usd-outlook-ecb-led-rally-loses-momentum/

2024-11-28 09:15

Trading was thin on Thursday as the US observed the Thanksgiving holiday. The core PCE price index increased by 0.3%, in line with expectations. The US economy expanded by 2.8% as expected. The USD/CAD forecast indicates a rebound in the Canadian dollar stemming from the easing US dollar and slight gains in crude oil prices. However, the uptrend remains intact as traders anticipate Trump’s tariffs to boost the US economy. –Are you interested to learn more about forex options trading? Check our detailed guide- Trading was thin on Thursday as the US observed the Thanksgiving holiday. However, in the previous session, the Canadian dollar recovered amid speculation that Canada could avoid the full impact of Trump’s tariffs through negotiations. The likelihood of a 25% tariff on Canadian goods weighed on the loonie since Canada exports nearly 75% of its goods to the US. Tariffs would reduce demand for these goods and hurt the economy. However, experts believe Trump might be ready to negotiate better trading terms. Meanwhile, the greenback fell on Wednesday as Treasury yields eased after the US inflation report. The core PCE price index increased by 0.3%, in line with expectations. As a result, markets were more confident that the Fed would implement another rate cut in December. If inflation is behaving exactly as expected, policymakers will be confident enough to vote for a 25-bps rate cut next month. A separate report revealed that the US economy expanded by 2.8% as expected. Moreover, unemployment claims came in slightly lower than expected at 213,000. A rate cut in December might weaken the dollar. However, the long-term outlook remains bright as markets expect the Trump administration to increase economic growth and inflation. USD/CAD key events today Market participants do not expect any key reports from the US or Canada. Moreover, the pair might have a slow day due to the US Thanksgiving holiday. USD/CAD technical forecast: Growing bearish momentum On the technical side, the USD/CAD price is pulling back after failing to breach the 1.4100 resistance level. Nevertheless, the price still trades above the 30-SMA with the RSI over 50, supporting a bullish bias. From the price action on the chart, it is clear that bears are getting stronger. At the same time, while the price has made higher highs, the RSI has made lower ones. Consequently, there is a bearish divergence that could signal a looming reversal. However, to confirm this, bears must break below the 1.3951 support and the 30-SMA. https://www.forexcrunch.com/blog/2024/11/28/usd-cad-forecast-tariff-negotiation-hopes-ease-dollar/

2024-11-27 10:03

Australian inflation rose by 2.1% in October, below estimates of 2.3%. The likelihood of an RBA rate cut in December remained low at 14%. All eyes are on the upcoming US GDP and inflation figures. The AUD/USD forecast shows a resilient Aussie despite downbeat Australian inflation data. Meanwhile, the greenback eased slightly as markets awaited key economic figures from the US for clues of future Fed policy moves. –Are you interested to learn more about forex options trading? Check our detailed guide- Australia released its CPI report on Wednesday, showing inflation rose by 2.1% in October, below estimates of a 2.3% increase. However, it held steady from the previous month when inflation also increased by 2.3%. Meanwhile, core inflation increased by 3.5% after a 3.2% increase in the previous month. The mixed report had little impact on Reserve Bank of Australia rate cut bets. As a result, the Aussie barely reacted. The likelihood of a rate cut in December remained low at 14% while that of February was at 27%. Market participants are only fully pricing the first rate cut in May next year. Policymakers have said they need more evidence inflation is declining to consider lowering borrowing costs. On the other hand, the dollar paused after rallying in the previous session due to Trump’s promise to impose tariffs on goods from China and Canada. Such an outcome will brighten the outlook for the US economy in the long term. However, tariff optimism eased as markets returned their focus to US economic data. All eyes are on the upcoming GDP and inflation figures. Economists believe the economy will expand by 2.8%. Meanwhile, they expect inflation to increase by 0.3%. The actual figures will shape the outlook for the Fed’s December meeting. AUD/USD key events today US Prelim GDP q/q US unemployment claims US core PCE price index m/m AUD/USD technical forecast: Consolidation phase On the technical side, the AUD/USD price has rebounded after failing to breach the 0.6450 support level. However, it still trades below the 30-SMA, showing bears remain in charge. Moreover, the RSI trades slightly below 50 in bearish territory. However, there is a chance the price will soon break above the 30-SMA since it has been trading in a range between the 0.6450 support and the 0.6550 resistance. Within this range, the price has chopped through the SMA with no clear direction. If it breaks above, it will likely retest the range resistance. Otherwise, bears will make another attempt at the range support. https://www.forexcrunch.com/blog/2024/11/27/aud-usd-forecast-aussie-defies-downbeat-inflation-report/

2024-11-27 08:52

Traders sought safety after Trump’s tariff vows raised fears of trade wars. The dollar rallied at the prospects of stronger economic performance. Japan’s services producer price index increased by 2.9% in October. The USD/JPY price analysis shows a strengthening yen amid safe-haven demand and increasing Bank of Japan rate cut expectations. Meanwhile, the dollar paused its rally as market participants awaited key reports including inflation, unemployment claims, and GDP. –Are you interested to learn more about forex options trading? Check our detailed guide- The yen rallied on Tuesday and Wednesday as traders sought safety after Trump’s tariff vows raised fears of trade wars. The US president-elect promised to impose a 25% tariff on goods from Mexico, Canada and China. This news reduced risk appetite and boosted safe-haven currencies like the yen. Tariffs will significantly hurt major economies like China and Canada, impacting the global economy. On the other hand, the dollar rallied at the prospects of stronger economic performance. Tariffs imposed on imported goods will increase demand for local goods and boost the economy. However, by Wednesday, the rally paused as market focus shifted to looming US economic data. Elsewhere, data revealed that Japan’s services producer price index increased by 2.9% in October after a 2.8% rise in the previous month. Higher inflation increases the likelihood that the Bank of Japan will hike rates in December, lifting the yen. Meanwhile, the US will release reports on GDP, unemployment claims, and inflation. Economists expect the economy to expand by 2.8%, holding from the previous reading. Meanwhile, the core PCE price index might increase by 0.3% as it did in the previous month. Upbeat economic data will lower the likelihood of a December rate cut, boosting the dollar. On the other hand, downbeat data will solidify rate-cut expectations. USD/JPY key events today US prelim GDP q/q US unemployment claims US core PCE price index m/m USD/JPY technical price analysis: Bears break below 151.74 On the technical side, the USD/JPY price is on the verge of breaking below the 151.74 support level. The price has fallen sharply after detaching from the 154.51 key level. It trades well below the 30-SMA, indicating a steep decline. Meanwhile, the RSI has dipped into the oversold region, showing solid bearish momentum. If the price closes well below the 151.74 level, the decline will continue to the next support level. On the other hand, if USD/JPY fails to breach the support, it might pull back to retest the 30-SMA before making another attempt. https://www.forexcrunch.com/blog/2024/11/27/usd-jpy-price-analysis-risk-flows-boj-rate-cut-bets-lift-yen/