Australian Dollar Under Pressure as U.S. Dollar Strengthens Amid Fed's Caution and AI Chip Sanctions on China

Economic

Summary:

The Australian Dollar (AUD) remains subdued against the U.S. Dollar (USD), weighed down by renewed market concerns about U.S.-China tensions and the Federal Reserve's cautious stance on rate cuts.

SELL AUDUSD

Close Time

CLOSED

0.64800

Entry Price

0.63600

0.65600

0.62220 +0.00032 +0.05%

62.3

Pips

Profit

0.63600

0.64177

Exit Price

0.64800

Entry Price

0.65600

The Australian Dollar continues to struggle against the U.S. Dollar, extending its losses as the U.S. Federal Reserve remains cautious about future rate cuts. The Fed’s stance comes amid persistent inflation concerns and robust consumer spending. Additionally, geopolitical developments are weighing heavily on the AUD/USD pair, with the U.S. poised to introduce further restrictions on AI chip exports to China.

This renewed tension between the world's two largest economies poses a significant risk to Australia, given its close trade ties with China. The AUD's sensitivity to global risk sentiment has kept the currency under pressure, despite some positive domestic economic data.

Australia's total new capital expenditure rose by 1.1% quarter-on-quarter in Q3, beating market expectations of a 0.9% increase. This marks a notable rebound from a 2.2% contraction in the previous quarter, indicating a recovery in business investment. However, the data was insufficient to lift the AUD significantly as external risks overshadowed the domestic outlook.

Markets remained subdued, with trading volumes thinning due to the Thanksgiving holiday in the U.S. This lull, however, is unlikely to last as Monday’s announcement of AI chip sanctions could reignite volatility.

The upcoming sanctions targeting China's AI sector are expected to have ripple effects on global markets. Given Australia’s heavy reliance on Chinese demand for commodities, any slowdown in China’s economy could directly impact Australian exports.

Market participants are closely watching how China will respond to these measures, especially with President-elect Donald Trump signaling a more aggressive trade policy. His plan to increase tariffs on all Chinese imports by 10% further exacerbates concerns, raising the specter of a broader trade conflict.

The Federal Reserve’s recent FOMC minutes revealed a cautious approach to rate cuts, driven by steady inflation and a resilient labor market. October’s PCE Price Index showed a year-over-year increase of 2.3%, up from 2.1% in September. Meanwhile, the core PCE, a preferred inflation gauge, ticked up to 2.8%, signaling persistent inflationary pressures.

In contrast, the Reserve Bank of Australia (RBA) has maintained a hawkish outlook despite recent soft inflation data. October’s monthly Consumer Price Index (CPI) rose by 2.1% year-over-year, falling short of expectations. Nonetheless, the RBA remains focused on keeping inflation within its 2-3% target range.

Australia’s major banks, including Westpac and NAB, have pushed back their rate cut forecasts to May 2024, reflecting uncertainty about the timing of monetary easing. CBA and ANZ, however, maintain a more aggressive stance, anticipating a cut as early as February.

Technical Analysis

Risk aversion has been a dominant theme, driving demand for the U.S. Dollar. The AUD/USD pair remains under downward pressure, trading near key support levels. The pair’s inability to break above 0.6500 suggests continued weakness.

Technical indicators point to a bearish outlook, with the EMA50 forming strong resistance. A break below 0.6440 could open the door for further losses toward 0.6355. The expected trading range for the day is between 0.6410 support and 0.6510 resistance.

TRADE RECOMMENDATION

SELL AUDUSD

ENTRY PRICE: 0.6480

STOP LOSS: 0.6560

TAKE PROFIT: 0.6360

Risk Warnings and Disclaimers

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Manuel

Economic

Central Bank

Summary:

The EUR/USD reached a local low of 1.0330 on November 22 before rebounding toward the 1.0449 zone, a level previously tested on October 3 and acting as support. S

BUY EURUSD

Close Time

CLOSED

1.05218

Entry Price

1.07850

1.04000

1.04198 -0.00021 -0.02%

61.8

Pips

Profit

1.04000

1.05836

Exit Price

1.05218

Entry Price

1.07850

On Tuesday, Mario Centeno, an ECB policymaker and head of Portugal's central bank, expressed concerns about the Eurozone's economy, describing it as "stalling" and facing "mounting downside risks." Among these, Centeno highlighted tariffs threatened by former U.S. President Trump as an additional challenge. On monetary policy, he warned of the risk that inflation might fail to meet the ECB's target, emphasizing the importance of not delaying rate cuts for too long.

In contrast, Isabel Schnabel, a member of the ECB’s Executive Board, played down fears of inflation falling short of the bank's target. Speaking with Bloomberg on Wednesday, Schnabel pointed to persistently high inflation in the services sector. On the outlook for interest rates, she stated, "Given the inflation outlook, I believe we can gradually move toward neutrality if incoming data continues to confirm our baseline."

A rate cut by the ECB at its December meeting appears almost certain. However, market participants remain divided on the likely magnitude of the cut. According to a note from ING analysts, "The prevailing view is that there’s no fiscal salvation in the Eurozone, and the only way to address current woes is for the ECB to cut rates faster than usual. Markets are pricing in a 37 bps probability of a 50 bps rate cut in December, with short-term rate spreads between the U.S. and Eurozone still wide at 190 bps."

Investors will closely watch the preliminary Harmonized Index of Consumer Prices (HICP) data for November, covering the Eurozone and its largest economies, set to be released on Thursday and Friday.

Meanwhile, in the U.S., the second reading of Q3 GDP is expected to show robust economic growth at 2.8%, unchanged from the preliminary estimate. Personal spending for October is forecast to rise by 0.4%, while both headline and core PCE price index readings are projected to climb from September, reaching 2.3% and 2.8%, respectively.

These data points may heighten concerns among some policymakers that progress on inflation has stalled since the summer. Strong growth and rising PCE figures could dampen expectations for a December rate cut by the Fed, particularly as policymakers have grown increasingly cautious, as reflected in the minutes from the November FOMC meeting. Potential Retracement Could Open Buying Opportunities_1

Potential Retracement Could Open Buying Opportunities_1

Technical Analysis

The EUR/USD reached a local low of 1.0330 on November 22 before rebounding toward the 1.0449 zone, a level previously tested on October 3 and acting as support. Since then, the pair has retraced to 1.0550. Should the 1.0520 level hold firm, it could pave the way for a renewed bullish push toward the 1.0785 region.

The 100- and 200-period moving averages are positioned well above the current price, at approximately 1.0830, indicating that the pair remains significantly below these long-term averages. The recent downward movement appears overextended, with key support levels briefly breached before being recovered, suggesting the potential for a corrective move higher.

From a Fibonacci perspective, a retracement to the 50% level near 1.0785 aligns with a notable price resistance zone. If this resistance is reached, it may serve as a key level to assess the pair's momentum for further upside or a potential reversal.

Trading Recommendations

Trading direction: Buy

Entry price: 1.05220

Target price: 1.07850

Stop loss: 1.0400

Validity: Dec 5, 2024 15:00:00

Risk Warnings and Disclaimers

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Manuel

Cryptocurrency

Summary:

The recent rally saw SHIB peak at 0.00003060 before consolidating at 0.00002351, a critical price level. Historically, this zone has served as a turning point for upward moves.

BUY SHIB-USDT

Close Time

CLOSED

0.000025610

Entry Price

0.000045840

0.000021000

0.000021562 +0.000000036 +0.17%

62.3

Pips

Profit

0.000021000

0.000026233

Exit Price

0.000025610

Entry Price

0.000045840

Shiba Inu debuted in August 2020 as a memecoin, created by an anonymous developer known as Ryoshi. Initially, it functioned as an ERC-20 token on the Ethereum blockchain. Over time, its low per-token price and growing adoption highlighted the need for a more efficient transaction system, especially as the project expanded, driven by an ambitious roadmap.

The solution to these challenges emerged as Shibarium, a Layer 2 (L2) blockchain designed to operate on Ethereum, offering faster and cheaper transactions. Officially launched in August 2023—three years after SHIB's inception—Shibarium represents a critical step in scaling the Shiba Inu ecosystem.

Layer 2 solutions, akin to building highways over congested roads, alleviate transaction bottlenecks and reduce processing costs. Ethereum’s popularity as one of the most widely used blockchains underscores the necessity of L2 solutions like Shibarium, alongside other notable platforms such as Arbitrum, Optimism, Polygon, and Base.

Shibarium enhances Shiba Inu's ecosystem by delivering:

Speed and Efficiency: Transactions are processed significantly faster than on Ethereum’s mainnet, reducing wait times. This efficiency benefits both casual users and developers who rely on rapid, cost-effective transactions.

Security: Leveraging Ethereum’s Proof of Stake (PoS) consensus mechanism, Shibarium ensures energy-efficient and fraud-resistant transaction validation.

Scalability: By managing transactions off Ethereum's mainnet, Shibarium can handle high activity volumes without slowdowns, maintaining smooth network operations even during peak usage.

Compatibility: Seamless integration with Ethereum-based projects and tools simplifies the development and deployment of decentralized applications (dApps). This interoperability allows Shibarium to capitalize on Ethereum's ecosystem while introducing technical improvements.

Token Burning: A portion of transaction fees is used to burn SHIB tokens, effectively reducing supply. This deflationary measure could positively influence the token’s value over time.

To further enhance its ecosystem, the Shiba Inu project proposed creating a Strategic Hub for Innovation and Blockchain (S.H.I.B.) in a U.S. city. This hub aims to transform the location into a global center for blockchain technology and sustainable development.

The hub could spur the development of new applications and use cases for SHIB, increasing its value proposition among investors and developers alike. Additionally, supportive economic policies, such as deregulation and public-private partnerships, could provide a favorable environment for the hub’s success. Shibarium and SHIB´s Ecosystem Advancements Spark Optimism_1

Shibarium and SHIB´s Ecosystem Advancements Spark Optimism_1

Technical Analysis

Shiba Inu reached a cycle high of 0.00004584 on March 5 but experienced a pullback to a low of 0.000010 by August 5. Since then, the token has resumed its bullish momentum, supported by fundamental developments.

The recent rally saw SHIB peak at 0.00003060 before consolidating at 0.00002351, a critical price level. Historically, this zone has served as a turning point for upward moves. The ongoing consolidation suggests the potential for another bullish surge, possibly toward the 0.00004584 resistance level.

Adding to the optimism, moving averages are on the verge of forming a bullish crossover, which could add further upward pressure on SHIB's price. Combined with Shibarium’s advancements and ecosystem upgrades, these factors align to position SHIB for a potential rally.

Trading Recommendations

Trading direction: Buy

Entry price: 0.00002572

Target price: 0.00004584

Stop loss: 0.00002100

Validity: Dec 10, 2024 15:00:00

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

The Euro (EUR) faced pressure from weak economic data from the Eurozone, while the Canadian Dollar (CAD) was supported by a recovery in oil prices and positive expectations from the Bank of Canada (BoC)...

SELL EURCAD

Close Time

CLOSED

1.48352

Entry Price

1.48200

1.48550

1.50105 -0.00003 0.00%

15.2

Pips

Profit

1.48200

Exit Price

1.48352

Entry Price

1.48550

On November 28, 2024, the EUR/CAD pair was trading around 1.48352, with an intraday high of 1.48450 and a low of 1.48350. The Euro continued to be under pressure due to weak economic data from the Eurozone, including the services and manufacturing PMI indexes falling below 50 – a sign of economic contraction. This increased expectations that the European Central Bank (ECB) will maintain its dovish monetary policy in the near term.

The Canadian dollar, on the other hand, has been supported by a rebound in oil prices, Canada’s main export. Crude oil prices rose slightly after OPEC+ reaffirmed its commitment to cut production to support the market. In addition, inflation in Canada is cooling but remains high enough for the BoC to keep interest rates steady for the time being.

Market psychology

Investor sentiment on EUR/CAD is currently tilted to the negative side. According to data from Forex Sentiment, more than 60% of investors are holding short positions on the pair, reflecting the belief that the downtrend will continue in the short term.

The Fear and Greed Index shows that market sentiment is neutral, but the weakness of the Eurozone and the relative strength of the CAD have fueled bearish sentiment towards the Euro. In addition, institutional investors are also shifting away from risky assets like the Euro to safer or potentially higher-yielding assets like the CAD.

Technical analysis

EUR/CAD Giảm Mạnh: Xu Hướng Giảm Có Tiếp Tục?_1

The current price is hovering near the lower band of the Bollinger Bands at 1.48350, signaling that the market may have entered an oversold state in the short term. The expanding Bollinger Bands indicate increased price volatility recently, with the middle band (1.48427) acting as important resistance if the price attempts to recover.

If the price fails to break above this mid-band in the coming hours, the bearish trend will be further reinforced and the next target will be the deeper support zone around 1.48200.

The Stochastic indicator is currently hovering around 54.01 – close to neutral territory but showing signs of turning bearish. This suggests a possible downside correction before the main trend resumes.

Trading Recommendations

EUR/CAD is under strong downward pressure due to the weakness of the Euro on weak economic data from the Eurozone and the relative strength of the CAD on the recovery of oil prices and positive expectations from the BoC. Technical indicators also suggest that the downtrend is likely to continue if the price fails to break above key resistance levels in the coming time.

Based on technical analysis and current market situation:

Entry: Consider entering a SELL order around the current price of 1.48352 if price fails to break above the resistance at 1.48450 – 1.48500.

Take Profit: Set profit target at nearest support zone around 1.48200 or deeper at 1.48100 if the downtrend continues.

Stop Loss: Place stop loss above the key resistance level at around 1.48550 to protect the position.

Conclude

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

The US Dollar (USD) continued to be supported by positive economic data from the United States and expectations that the Fed will maintain its tight monetary policy. Meanwhile, the Swiss Franc (CHF) was pressured by reduced demand for safe-haven assets...

BUY USDCHF

Close Time

CLOSED

0.88099

Entry Price

0.88350

0.87980

0.89909 +0.00049 +0.05%

25.1

Pips

Profit

0.87980

0.88350

Exit Price

0.88099

Entry Price

0.88350

As of November 28, 2024, the USD/CHF pair is trading around 0.88100. The US dollar has found upside momentum thanks to positive economic data from the United States, including the third quarter GDP report showing the economy grew at a stronger-than-expected rate of 3.2%. This reinforced expectations that the US Federal Reserve (Fed) will maintain its tight monetary policy in the near term.

In contrast, the Swiss franc is under pressure as safe-haven flows ease due to improved global risk sentiment. However, geopolitical tensions between Russia and Ukraine remain a mild support for the CHF in the short term.

Market psychology

The market sentiment on USD/CHF is currently tilted to the positive side. According to data from Forex Sentiment, about 62% of investors are holding long positions on the pair, reflecting the belief that the uptrend will continue in the short term.

The Fear and Greed Index shows market sentiment is at “Greed,” with investors shifting to riskier assets like stocks and high-yield bonds. This further strengthens the USD as international capital continues to flow into the United States.

In addition, trading volume in the forex market has also increased significantly in the past hours, especially in long positions on USD/CHF, indicating strong expectations for the pair's recovery.

Technical analysis

USD/CHF Tăng Nhẹ: Xu Hướng Tăng Có Tiếp Tục?_1

The current price is hovering near the middle line of the Bollinger Bands at 0.88100, signaling that the market is in a consolidation phase after the previous decline. The current Bollinger Bands are quite narrow, indicating low volatility and a high probability of a breakout from the current price range if the trading volume increases in the coming hours.

The middle band of the Bollinger Bands acts as important support if the price starts to correct lower again. If the price breaks above the upper band at around 0.88165 – 0.88170, the uptrend will be further reinforced.

The Stochastic indicator is currently hovering around 23.38 – near the oversold zone (20). This suggests a possible short-term technical recovery before the uptrend continues. If the Stochastic indicator crosses above 50 in the coming hours, this will further reinforce the buy signal.

Trading Recommendations

USD/CHF is showing signs of recovery thanks to the strength of the USD supported by the positive economic outlook from the US and the weakness of the CHF due to the lack of safe-haven flows. Technical indicators also show that the uptrend is likely to continue if the price stays above the important support levels and breaks through the nearest resistance zone in the coming time.

Based on technical analysis and current market situation:

Entry: Consider entering a BUY order around the current price of 0.881 if price holds above the important support zone around 0.88200 – 0.88250.

Take Profit: Set a target to take profit at the nearest resistance zone around 0.88350 or deeper at 0.88400 if the uptrend continues.

Stop Loss: Place stop loss below the important support level at 0.87980 to protect the position.

Risk Warnings and Disclaimers

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Eva Chen

Commodity

Economic

Summary:

Geopolitical tensions, insights from the Federal Reserve, and broader market sentiment have resulted in fluctuations in gold prices.

BUY XAUUSD

Close Time

CLOSED

2639.24

Entry Price

2706.00

2525.00

2631.57 -1.91 -0.07%

15.4

Pips

Profit

2525.00

2640.78

Exit Price

2639.24

Entry Price

2706.00

Fundamentals

The U.S. dollar continued to lose momentum on Wednesday, leading to declines in major assets and pushing gold prices above US$2,650, nearing a two-day high. This trend is attributed to geopolitical risks and the tariff plans of President-elect Trump, which have driven safe-haven investments for the second consecutive day.

Additionally, the decline in US Treasury yields has placed the dollar at a disadvantage, aiding gold in maintaining its rebound from around US$2,605 overnight.

Meanwhile, the tone of the Federal Reserve's meeting minutes has also contributed positively to gold prices. The FOMC minutes aligned with the signals conveyed by Chairman Powell during the press conference, without presenting any significant surprises. The minutes reiterated that monetary policy does not follow a predetermined path and emphasized the importance of data dependency. However, committee members paid particular attention to recent data fluctuations and the significance of monitoring potential trends.

The minutes indicate that committee members hold an optimistic view on inflation, with labor market data, inflation expectations, and pricing power indicators reinforcing the narrative of deflation. We agree with these perspectives and anticipate that the FOMC will continue to lower interest rates at the next meeting. This short-term outlook is favorable for non-yielding gold.

Bullish investors may also prefer to wait for key U.S. macroeconomic data, including the Personal Consumption Expenditures (PCE) price index data for October, which the Bureau of Economic Analysis is set to release on Wednesday, before making new bets.

Buy Low and Sell High when Trading in Fluctuations_1

Technical Analysis

On Wednesday, gold prices continued their upward momentum, supported by a solid base, breaking through the US$2,650 threshold, which favors ongoing bullish trading.

However, the oscillators in the 1D timeframe have yet to confirm a positive divergence, indicating that the upward movement may encounter significant resistance in the 4H timeframe. Key resistance levels include around US$2,660; a breakout above this range could see gold prices rise further to the US$2,665 range, followed by the US$2,678 threshold, ultimately targeting the US$2,700 threshold.

A break above $2,721 (the highest price on Monday) would signal a bullish trend and pave the way for further gains. The next target would be US$2,790, aligning with previous historical highs.

On the downside, a decisive break below the main trendline could lead to further declines and confirm a shift to a bearish short-term trend. The US$2,624-US$2,620 range is expected to provide some support for the market before a potential drop below the US$2,600 level. A break of this latter level would be viewed as a new trigger for bearish trading.

Trading Recommendations

Trading Direction: Buy

Entry Price: 2585

Target Price: 2706

Stop Loss: 2525

Valid until: December 12, 2024 23:55:00

Support: 2640, 2633, 2624

Resistance: 2658, 2665, 2678

Risk Warnings and Disclaimers

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Eva Chen

Central Bank

Forex

Summary:

The Reserve Bank of New Zealand's (RBNZ) decision to lower interest rates by 50 basis points was in line with expectations; however, the anticipated easing trajectory disappointed dovish expectations. The NZDUSD briefly rose over 50 points, yet the technical outlook remains bleak.

BUY NZDUSD

Close Time

CLOSED

0.58933

Entry Price

0.62090

0.57400

0.56236 +0.00009 +0.02%

114.7

Pips

Loss

0.57400

0.57786

Exit Price

0.58933

Entry Price

0.62090

Fundamentals

The RBNZ has reduced the official cash rate by 50 basis points to 4.25%, a decrease that aligns with widespread market expectations. The RBNZ maintains an accommodative stance and indicated that if economic conditions meet projections, "the committee anticipates being able to further lower the official cash rate early next year."

Governor Adrian Orr did not rule out the possibility of a significant rate cut in February during the post-meeting press conference. However, the RBNZ now forecasts that by the end of 2024, the cash rate will decline to approximately 3.5%, suggesting that the RBNZ will implement smaller rate cuts or pause reductions to assess the impact of previous accommodative policies.

In terms of economic outlook, the RBNZ expects a contraction of 0.2% in the economy during the third quarter of 2024, followed by a recovery to a growth of 0.3% in the fourth quarter. It is anticipated that economic growth will stabilize at a quarterly rate of 0.6% in 2025 and 2026. The RBNZ noted, "Economic growth is expected to recover in 2025 as lower interest rates will encourage investment and other expenditures."

The projected inflation rate is expected to ease from the current 2.2% to 2% by early 2025; however, the RBNZ anticipates that inflation will rise again, stabilizing between 2.0% and 2.5% by early 2027.

Following the announcement of the RBNZ's interest rate decision, the New Zealand dollar experienced a significant surge, with the NZDUSD climbing over 50 points at one point. However, after comments from Governor Orr regarding the interest rate outlook, the New Zealand dollar retraced some of its earlier gains.

MARKET WATCH: We maintain our forecast for the official cash rate of the RBNZ, continuing to expect a reduction of 25 basis points in February, April, and May of next year, bringing the rate down to 3.5%. As always, the pace and extent of policy easing will be highly dependent on data, particularly given the lengthy interval until the next meeting.

In light of Governor Orr's remarks, the likelihood of a 50 basis point cut in February has increased; however, the data from now until then will be crucial, and there are clear indications of broad-based growth in economic activity, starting from a very weak baseline.

Downward Slope of the Angle Supports the Rebound Outlook_1

Technical Analysis

After the RBNZ reduced interest rates by 50 basis points, the NZDUSD experienced a brief decline but quickly regained its footing, rising back above 0.5800. However, the short-term outlook remains pessimistic, as the NZDUSD has not surpassed previous highs during its rebound from earlier declines, which heightens the risk of further downturns.

However, the Relative Strength Index and Stochastic Oscillator are approaching oversold levels. Additionally, the downward slope observed since October 2023 suggests that the market may be poised for a significant rebound.

Initially, a break above the previous high of 0.5924 will serve as an early signal for a rebound, as well as an indication of a potential halt in the downtrend. Following this level, bulls will aim to test the last round of selling pressure at 0.6009, and subsequently at 0.6057, with further gains potentially challenging the first round of selling resistance at 0.6209.

On the other hand, a drop below 0.5797 would invalidate this perspective.

Overall, while the NZDUSD remains in a bearish trend, it is currently situated within a rebound range that has been maintained since the beginning of 2023. We believe that history is likely to repeat itself.

Trading Recommendations

Trading Direction: Buy

Entry Price: 0.5855

Target Price: 0.6209

Stop Loss: 0.5740

Valid until: December 12, 2024 23:55:00

Support: 0.5867, 0.5797, 0.5774

Resistance: 0.5924, 0.6009, 0.6037

Risk Warnings and Disclaimers

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Australian Dollar Under Pressure as U.S. Dollar Strengthens Amid Fed's Caution and AI Chip Sanctions on China

Technical Analysis

Potential Retracement Could Open Buying Opportunities

Technical Analysis

Shibarium and SHIB´s Ecosystem Advancements Spark Optimism

Technical Analysis

EUR/CAD Drops Sharply: Will the Downtrend Continue?

Market psychology

Technical analysis

Trading Recommendations

Conclude

USD/CHF Slightly Up: Will the Uptrend Continue?

Market psychology

Technical analysis

Trading Recommendations

Buy Low and Sell High when Trading in Fluctuations

Fundamentals

Technical Analysis

Trading Recommendations

Downward Slope of the Angle Supports the Rebound Outlook

Fundamentals

Technical Analysis

Trading Recommendations

Risk Disclosure