Is the Weaker Dollar Ushering in a New Era for Gold Prices Above $2,060?

Commodity

Summary:

Gold prices rallied to new heights, breaching the $2,060 per ounce mark on Tuesday, propelled by a confluence of factors, including a weakening dollar and lower bond yields.

BUY XAUUSD

Close Time

CLOSED

2055.00

Entry Price

2090.00

2035.00

2493.48 -5.91 -0.24%

77.4

Pips

Profit

2035.00

2062.74

Exit Price

2055.00

Entry Price

2090.00

Gold, the perennial safe-haven asset, has experienced a remarkable ascent, breaking through the psychological barrier of $2,060 an ounce on Tuesday. This surge can be attributed to a combination of factors, with market players closely eyeing developments in the US economy, especially regarding inflation and the potential for a Federal Reserve interest rate cut.

Economic Signals Driving Gold's Rally: Recent data releases have played a pivotal role in shaping market sentiment. Last Friday's revelation that the core PCE index in the US, a key inflation metric closely monitored by the Federal Reserve, dropped from 3.4% in October to 3.2% in November has fueled expectations of a dovish stance. The figures fell short of the forecasted 3.3%, underlining concerns about inflationary pressures.

Is the Weaker Dollar Ushering in a New Era for Gold Prices Above $2,060?_1

Adding to the mix, Thursday's economic indicators pointed towards a softer-than-expected economic growth in the third quarter. Coupled with a marginal uptick in unemployment benefit claims, these signals are heightening anticipation of monetary policy adjustments. Investors are now eyeing the Federal Reserve's potential move to cut interest rates as a strategy to counterbalance economic headwinds.

Beyond the borders of the United States, Bank of Japan Governor Kazuo Ueda's remarks on Monday added a global dimension to the gold narrative. Ueda's statement that the likelihood of achieving the 2% inflation target was "gradually rising" raised hopes of policy normalization. This global sentiment may further shape gold's trajectory as investors seek stability amid evolving economic landscapes.

Technical Analysis

From a technical standpoint, . The resistance zone that previously capped gains at 2050-2060 has now transformed into a support level. I recommend looking for opportunities to go long when price comes back to retest that broken previous level of resistance which is also in confluence with the 61.8% fibonacci retracement level and the upward trendline which has been acting as a diagonal support for gold .I see the resistance level around 2090 as the first potential target and theres also a potential to go test the all time highs

TRADE RECOMMENDATION

BUY GOLD

ENTRY PRICE : 2055

STOP LOSS : 2035

TAKE PROFIT : 2090

Risk Warnings and Disclaimers

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Peterson

Commodity

Summary:

Today's oscillation will start from $2050 to $2075, and it is better to buy low and sell high.

SELL XAUUSD

EXP

EXPIRED

2075.00

Entry Price

2050.00

2080.00

2493.48 -5.91 -0.24%

Pips

EXPIRED

2050.00

2065.54

Exit Price

2075.00

Entry Price

2080.00

Fundamentals

During Tuesday's (December 26th) Asian session, spot gold ascended slightly, and it is now trading at $2058. Announced on Friday, the U.S. November core PCE price index, the key gauge for inflation, declined more than expected. Gold prices rebounded in the European session after the data was released, breaking above the half-month high. It once reached $2070 after breaking through the resistance at $2065, followed by a rapid and substantial retracement, and closed at $2053. Large oscillations were seen due to the profit-taking before Christmas and New Year holidays. In general, the market is still trading the decline in inflation as well as next year's Fed rate cuts, and gold bulls are also enjoying the benefits of easing expectations.

On Friday, we also emphasized that if the U.S. November core PCE data strengthened the rate cut expectations again, gold prices would ascend further. As we expected, gold successfully stood above the resistance near $2065, but it failed to reach the key resistance at $2080. Now, the only suspense is the December data. If the data supports that inflation will head to the target of 2%, the gold bulls will push the price to $2080 easily, and gold may even reach $2100.

There wasn't a substantial retracement in gold last Friday. It once plunged to $2045 and then oscillated upward to a high of $2070 in the U.S. session. It broke above the upper edge of our strategy range and reached our stop-loss level, so we suffered a loss of $5. Afterward, the price retraced significantly by $20. It could be a great earning for those who expanded the stop-loss or did not set a stop-loss, but it was also dangerous by doing so. Risks are always close, especially for those who are not well-prepared, unless they have set up a comprehensive stop-loss or non-stop-loss system.

Data: The U.S. November core PCE price index rose 3.2% YoY, while the expected reading was 3.3%, and the previous reading was 3.4%. Besides, the November core PCE price index was up 0.1% MoM, compared to an expected reading of 0.2%, and the previous reading was 0.1%.

Today's focus: U.S. FHFA House Price Index annual/monthly rate for October, U.S. S&P/CS 10-City Home Price Index annual rate in October.

Technical Analysis

There was no trading yesterday for Christmas. Last Friday, gold ascended slightly in the Asian session. With the support from data, gold once reached $2070 during the European session. Then, it declined in the U.S. session to $2050, showing an inverted 'V' shape movement, closing the daily chart with a long bearish inverted hammer candlestick. Without considering the holiday effect, there was a bearish divergence in the pattern. Technically, it should reach a phase top. However, the general trend is still upward, and investors should catch the opportunity in the near term. Due to the holiday effect, gold bulls may pull up the price, and it will be a chance to short. If investors want to go long, try not to chase the upside but wait until gold prices fall from highs.

At present, gold is dominated by bulls. If they increase their positions, gold prices will go up, and if they decrease positions, gold will retrace. In the 1H chart, as the MACD death cross expands slightly, a retracement will appear soon. Moreover, there is a bearish divergence in the 4H chart and the daily chart. Today, investors should focus on the range from $2050 to $2075 where they can buy low and sell high. Inflation Cools, Gold Surges Before Falling_1

Inflation Cools, Gold Surges Before Falling_1

Trading Recommendations

Trading direction: Short

Entry price: 2075

Target price: 2050

Stop loss: 2080

Support: 2050.000/20350.000

Resistance: 2065.000/2080.000

Risk Warnings and Disclaimers

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Peterson

Commodity

Summary:

Today's oscillation will start from 72.5 to 74.80, and it is better to buy low and sell high.

SELL WTI

Close Time

CLOSED

74.800

Entry Price

72.500

75.200

73.287 -0.203 -0.28%

40.0

Pips

Loss

72.500

75.201

Exit Price

74.800

Entry Price

75.200

Fundamentals

During Tuesday's (December 26th) Asian session, WTI crude oil oscillated slightly, and it is currently trading at 73.8 dollars/bbl.

Last Friday, WTI oil price fell from a high of 75 and once touched 73.4 before getting support. It closed the daily chart lower with a long upper shadow. On Sunday, shipping giant Maersk (AMKBY) said that due to the U.S.-led joint convoy action, the company is preparing to resume shipping operations in the Red Sea and the Gulf of Aden, and the market speculation for the Red Sea crisis is ending soon. China's domestic crude oil prices fell sharply under the impact of the news, and then they fluctuated upward, with all the decline recovered. Yesterday, as the foreign exchange market closed during Christmas, and the U.S. crude oil avoided the bearish sentiment, opening normally this morning.

With the joint convoy action, the impact of the Red Sea crisis may gradually withdraw from the main trading logic. In the short term, oil prices will oscillate downward to release the accumulated demand of a retracement. Nevertheless, with the full release of the bearish momentum, WTI is expected to appreciate in the middle and long term. In addition, there is strong support near 70, and it will bring us the opportunity to go long for the middle term. Before that, WTI is not likely to rise sharply.

Last Friday, we emphasized that WTI would rebound but also would stay in the range of 74.5-75.5. As we expected, the price rebounded to as high as 75, and then it retraced to 73.5, where we instructed investors to go long. Investors who go long by following our instructions should have earned considerable profits.

News: Shipping giant Maersk (AMKBY) said on Sunday that it was preparing to resume shipping operations in the Red Sea and the Gulf of Aden due to the U.S.-led joint convoy action.

Today's focus: U.S. FHFA House Price Index annual/monthly rate for October, U.S. S&P/CS 10-City Home Price Index annual rate in October.

Technical Analysis

In the Asian session last Friday, WTI rebounded slightly, and fell from 75 after being suppressed. During the U.S. session, it declined and once touched 73.4 before getting support, closing the daily chart lower with a long upper shadow. In general, there isn't sufficient upward momentum, and WTI is oscillating at highs to get support from bullish news. If there isn't further bullish news, or the capital withdraws, WTI prices will retrace.

Technically, there are two bearish piercing patterns in the 1H chart. And MACD forms a death cross near the 0-axis, indicating a bearish trend in the 1H chart. Regarding the 4H chart, there is similar situation, so we should expect a weak trend today. However, we cannot rule out that WTI may strengthen and rise to 74.8. Today, investors should buy low and sell high in the range of 72.5-74.8. Bullish Sentiment Weakens and Oil Prices Oscillate Downward_1

Bullish Sentiment Weakens and Oil Prices Oscillate Downward_1

Trading Recommendations

Trading direction: Short

Entry price: 74.800

Target price: 72.500

Stop loss: 75.200

Support: 73.500/72.500

Resistance: 74.600/75.500

Risk Warnings and Disclaimers

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Warren Takunda

Commodity

Traders' Opinions

Summary:

WTI crude futures surged to $74 per barrel, marking the largest weekly gain in over two months amidst thin holiday trading. Geopolitical tensions in the Middle East, highlighted by Houthi attacks disrupting global trade, have impacted oil markets

SELL WTI

Close Time

CLOSED

73.000

Entry Price

68.000

76.000

73.287 -0.203 -0.28%

86.3

Pips

Profit

68.000

72.137

Exit Price

73.000

Entry Price

76.000

WTI crude futures have pushed toward $74 per barrel, showcasing the largest weekly gain in over two months. However, the enthusiasm is tempered by the holiday season, which is thinning trading volumes in some markets. Investors are closely monitoring geopolitical developments in the Middle East, where recent Houthi attacks on ships have disrupted global trade. The formation of a multinational maritime task force to protect commercial vessels in the Red Sea and the Gulf of Aden has also added a layer of complexity to the oil market dynamics.

Geopolitical Influences on Oil Prices

The recent attacks by Houthi rebels on ships have not only raised concerns about the security of vital trade routes but have also injected a dose of uncertainty into oil markets. As Denmark's Maersk announces preparations to resume operations in the Red Sea and the Gulf of Aden, the geopolitical landscape remains tense. The formation of a multinational maritime task force underscores the efforts to mitigate risks and ensure the safety of commercial vessels in the region, a factor that will undoubtedly play a role in shaping oil price movements in the coming weeks.

OPEC Unity Amidst Quota Disputes

Adding another layer of complexity, Angola's departure from OPEC on Friday has sparked discussions around production quotas within the oil-producing alliance. However, OPEC member countries have swiftly reaffirmed their commitment to existing output policies, signaling a united front despite internal disagreements. The stability of OPEC's production strategy will be closely watched as the organization navigates challenges within its membership.

Technical Analysis

While oil prices have shown resilience, technical analysis suggests a bearish undertone. The retesting of the confluence zone of the falling resistance lines (downward trendline),previous support level ,key fibonacci zone (61.8% retracement zone) and the emergence of a bearish continuation pattern (rising wedge) signal a potential downward trajectory. Since September 2023, USOIL has exhibited a persistent downward movement, seemingly unaffected by bearish volume and power. I project further declines, with predicted targets at $71.6, $69.8, and $67.8, signaling potential challenges ahead for oil bulls.

Global Economic Indicators and Oil Demand

On the demand side, signs of easing US inflation have reinforced expectations that the Federal Reserve may embark on interest rate cuts in the upcoming year. This, in turn, bolsters the global growth and energy demand outlook. The correlation between economic indicators and oil demand will likely play a crucial role in shaping future price movements.

TRADE RECOMMENDATION

SELL WTI

ENTRY PRICE : 73.00

STOP LOSS : 76.00

TAKE PROFIT : 68.00

Risk Warnings and Disclaimers

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Warren Takunda

Forex

Central Bank

Summary:

The Japanese Yen, having endured a lackluster performance in the past year due to the Bank of Japan's policies, is now showing signs of resilience and gaining strength. Recent speculation about a potential shift in the Central Bank of Japan's approach has sparked renewed interest in the currency.

BUY USDJPY

Close Time

CLOSED

143.000

Entry Price

147.000

141.000

146.680 -0.212 -0.14%

52.7

Pips

Profit

141.000

143.527

Exit Price

143.000

Entry Price

147.000

The Japanese Yen has been a subject of keen interest, witnessing a rollercoaster ride over the past year. The Bank of Japan's monetary policies played a pivotal role in steering the Yen's trajectory, resulting in a period of consistent weakening. However, recent developments suggest a potential reversal of fortunes, with the Yen gaining strength amid talks of a change in the central bank's approach.

Technical Analysis of USD/JPY:

Could 141.95 Prove to be the Crucial Support Level for USD/JPY's Recovery?_1

As the Christmas holiday season unfolds, USD/JPY has closed, leaving short-term volatility in a state of uncertainty. The currency pair is currently exhibiting stable trading around the 142.27 level. The consolidation comes in the wake of domestic consumer inflation data revealing weakness, injecting an element of uncertainty regarding the timing of the Bank of Japan's potential tightening of its loose monetary policy.

Minutes from the Bank of Japan's October monetary policy meeting shed light on the consensus among members, highlighting the necessity to patiently maintain the current easing policy and further weaken the Japanese Yen. This aligns with the ongoing modest increase in the US dollar, providing support for USD/JPY's recovery from recent weekly lows.

Strategic Outlook: The strategic outlook for USD/JPY hinges on the confirmation of 141.95 as a support level by buyers. Should this level be validated, an upward trend is anticipated to continue its modest recovery, with a projected increase to 145.96. We are closely monitoring this critical support level, recognizing its potential to shape the currency pair's trajectory in the coming weeks.

Bank of Japan's Policy Shift: The potential for a shift in the Bank of Japan's approach adds an intriguing layer to the unfolding narrative. The central bank's commitment to maintaining the current easing policy has been a key driver behind the Yen's weakness. A deviation from this stance could mark a turning point for the Japanese currency, influencing global markets and investor sentiment.

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Zi Cheng

Traders' Opinions

Summary:

Pound Sterling strengthens as strong UK retail sales data has deepened persistent inflation fears.

BUY GBPUSD

Close Time

CLOSED

1.27201

Entry Price

1.31424

1.24648

1.31410 -0.00031 -0.02%

57.7

Pips

Profit

1.24648

1.27778

Exit Price

1.27201

Entry Price

1.31424

Fundamental Analysis

On Friday, the British Pound (GBP) continues its rebound, driven by encouraging UK Retail Sales figures for November. The Office for National Statistics (ONS) revealed that retail spending by households defied expectations by staying positive compared to the previous year, contrary to market predictions of a significant decrease. The robust performance in Retail Sales was primarily fueled by a 2.8% rise in non-food retail stores, which offered substantial discounts during the Black Friday Sale.

The significant rebound in the Pound Sterling indicates that investors have overlooked the pessimistic Q3 Gross Domestic Product (GDP) revision, indicating a 0.1% contraction. This has heightened concerns about a potential technical recession in the UK economy, especially considering the Bank of England's projection of stagnant performance in the final quarter of 2023.

After the release of the economic data, Finance Minister Jeremy Hunt said that “The medium-term outlook for the UK economy is far more optimistic than these numbers suggest".

Technical Analysis

GBP/USD has crossed over the 200 Day Moving Average and retested the 200 Day Moving Average. It has shown signs that price does not want to get lower than the 200 Day Moving Average which could indicate the price of GBP/USD could continue to rally higher till the end of the year. I will be placing longs with my stop loss under the 200 Day Moving Average acting as a good protection for my long position and my take profit at the key resistance.

TRADE RECOMMENDATION

BUY GBP/USD

ENTRY : 1.27187

STOP LOSS : 1.24648

TAKE PROFIT : 1.31424

Risk Warnings and Disclaimers

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Chandan Gupta

Commodity

Summary:

The prevailing market sentiment hints at an excess of crude supply, which continues to exert downward pressure on prices. This surplus in the crude oil market persists, contributing to the ongoing trend of declining prices.

SELL WTI

Close Time

CLOSED

73.691

Entry Price

70.380

75.370

73.287 -0.203 -0.28%

167.9

Pips

Loss

70.380

75.375

Exit Price

73.691

Entry Price

75.370

WTI Crude Oil

Thursday's trading session in the West Texas Crude Oil market witnessed substantial fluctuations as traders navigated their positions with the holiday season looming ahead. Notably, the market saw a recent test of the $75 price level, but there has been a subsequent decline from this point. This decline aligns logically with prior expectations, considering the historical role of this level as a support zone. Market participants often remember these significant price levels, influencing their behavior and trading decisions.

An intriguing element of this area is its role as an options barrier, further elevating its significance in the market dynamics. Moreover, the 50-Day Exponential Moving Average (EMA) has descended and appears to be heading toward the critical $75 level. A breach below this level could potentially prompt attention toward the $68 mark, which might emerge as a plausible target in the market trajectory.

Presently, the market situation hints at the possibility of a retest of the $75 level. Recent market movements might also be attributed to short covering, as traders seek to secure profits in anticipation of the approaching holiday period.

The fluctuations experienced during Thursday's session underscore the market's sensitivity and response to key price levels. The $75 level, previously serving as a support, now stands as a pivotal point shaping market sentiment and price actions. The psychological impact of this level on traders' minds and the coinciding options barrier adds a layer of complexity and significance to its role in market movements.

Additionally, the declining trajectory of the 50-Day EMA signals a potential convergence with the $75 level. This convergence not only reinforces the importance of this price point but also raises anticipation regarding potential shifts in market trends should this level be breached.

Looking ahead, the $75 level is poised to dictate the market's course of action. A successful retest and sustained support could indicate market resilience, potentially leading to a bullish sentiment. Conversely, a breakdown below this level might trigger heightened selling pressure, directing attention toward the $68 mark as a plausible downside target.

The current market landscape appears to be influenced by various factors, including technical indicators, historical price levels, options barriers, and traders' positioning before the holidays. These dynamics collectively contribute to an environment of cautious optimism, wherein market participants carefully monitor and react to price movements around these critical levels.

In summary, the West Texas Crude Oil market's recent fluctuations around the $75 price level highlight the intricate interplay between technical factors, historical support, options barriers, and trader behavior. As the market approaches the holiday season, attention remains fixated on how it navigates these crucial price levels, which are poised to shape the market's trajectory in the near term. WTI: Investors Pause, Markets Fears_1

Brent

Brent markets have exhibited considerable volatility in recent trading sessions, initially attempting to breach the psychologically significant $80 price level. However, this upward movement was short-lived as the market reversed its course, indicating signs of negativity. This fluctuation underscores the market's struggle to establish a sustained direction amid conflicting forces.

Given the current circumstances and the approaching holiday season, the market is likely to experience continued turbulence. One major concern during this period is the limited liquidity anticipated for at least a week. This restricted liquidity could amplify market volatility, making price movements less indicative of broader trends or genuine market sentiment.

It's prudent to exercise caution and avoid overinterpreting market movements during this phase, except for acknowledging potential short covering that transpired in the days leading up to Wednesday. Traders often square off their positions before holidays to secure profits, especially considering the substantial gains made over the preceding months.

In the event of a reversal and a breakthrough above the 50-Day Exponential Moving Average (EMA), the market might redirect its focus toward the 200-Day EMA. The 200-Day EMA often holds considerable significance for market participants, serving as a pivotal indicator capable of influencing trading decisions and market sentiment.

However, prevailing market sentiment signals an oversupply of crude, exerting continuous downward pressure on prices. The persistent surplus in crude oil availability has been a prevailing trend, contributing to the market's bearish undertone. Moreover, trading activity during the holiday season poses distinct challenges, including reduced participation and erratic market behavior.

Considering the upcoming Christmas holiday, markets will be closed on Monday. Additionally, it's customary for major traders to reduce their influence on markets between Christmas and New Year's Day. This subdued participation during this period tends to limit significant market moves or influential activities.

Given these circumstances, it may be advisable to adopt a more conservative approach. Sitting on the sidelines and refraining from active engagement might be a prudent strategy. Short-term trading within a defined range, once the market stabilizes, could be an option. However, exercising caution and managing risk becomes paramount during this period of reduced liquidity and potential erratic market behavior.

In summary, the recent noise and volatility in Brent markets around the $80 level reflect the market's struggle to establish a clear direction. The impending holiday season, coupled with the anticipated limited liquidity, presents challenges for traders. It's crucial to acknowledge the potential impact of reduced participation and erratic market behavior during this period and adopt a cautious approach in navigating these market conditions. WTI: Investors Pause, Markets Fears_2

TRADE RECOMMENDATION

SHORT WTI

ENTRY PRICE : 73.63

STOP LOSS : 75.37

TAKE PROFIT : 70.38

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Data

Is the Weaker Dollar Ushering in a New Era for Gold Prices Above $2,060?

Inflation Cools, Gold Surges Before Falling

Fundamentals

Technical Analysis

Trading Recommendations

Bullish Sentiment Weakens and Oil Prices Oscillate Downward

Fundamentals

Technical Analysis

Trading Recommendations

Oil's Festive Rally: $74 Breached, Yet Technical Signals Paint a Bearish Picture for WTI Crude

Could 141.95 Prove to be the Crucial Support Level for USD/JPY's Recovery?

GBP/USD Aims to End the Year with Positive Gains

Fundamental Analysis

Technical Analysis

Investors Pause, Markets Fears

TRADE RECOMMENDATION

Risk Disclosure