ATFX Market Outlook 3rd December 2024

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ATFX Market Outlook 3rd December 2024 

Euro Under Pressure: French Government Crisis Sparks Market Concerns

The Nasdaq and S&P 500 closed at record highs on Monday, driven by technology companies. Investors are awaiting economic data this week, particularly the monthly employment report on Friday, since the Federal Reserve usually cuts interest rates again in December. The Dow fell 0.29%, the S&P 500 climbed 0.24%, and the Nasdaq jumped 0.97%. 

In late trade, the dollar index jumped 0.3% to 106.33 after robust U.S. manufacturing data from the Institute for Supply Management and S&P Global. EUR/USD plummeted 1% to 1.0469, the most significant decline since early November. 

Gold prices fell after a four-day gain as the dollar rallied as investors awaited economic data and Fed interest rate indications. Gold finished at $2,638 an ounce, down 0.6% after losing 1% earlier. Oil prices remained unchanged as fears that the Federal Reserve will not drop interest rates again at its December meeting countered prospects for increased demand from surging Chinese manufacturing activity.

Ahead of a significant shift in US key job data, October job openings in the US JOLTs are expected to see a slight movement today, despite lackluster market data. Comments from Federal Reserve officials such as Governor Waller and New York Fed President Williams may provide insights into this month's interest rate reduction.

[Financial data and events of significant concern] 

15:30 CH CPI NOV ** 

23:00 US JOLTs Job Openings OCT ** 

Tomorrow

05:30 API Crude Oil Stock Change *** 

08:30 AU Services & Composite PMI Final NOV ** 

08:30 JP Services & Composite PMI Final NOV ** 

09:45 CN Caixin Services & Composite PMI NOV ** 

EURUSD

1.0535/1.0567 Resistance

1.0433/1.0402 Support

EUR/USD fell 0.8% to below 1.0500 amid French political concerns and predicted US PMI numbers pressured the currency. This week's sparse European data and ECB speeches keep the pair under pressure before Friday's Nonfarm Payrolls. On the technical side, a bearish 10- and 20-day MA crossing indicates an additional fall, with support around 1.0433 and 1.0402.

GBPUSD

1.2687/1.2719 Resistance

1.2585/1.2554 Support

On Monday, the GBP/USD fell below 1.2700, ending a three-day winning streak and remaining under the 200-day EMA. Market sentiment was cautious due to limited UK data and positive US PMI statistics. Attention is now on Wednesday's speech by Bank of England Governor Andrew Bailey, with nonfarm payrolls also coming later this week. Technically, the pair continues to show negative momentum after declining from its peak at 1.2700.

USDJPY

150.28/150.46 Resistance

149.36/149.18 Support

The USD/JPY pair ended with minimal change but had reached its lowest point since late November. The dollar rebounded, while the yen gained support from expectations of a possible rate hike by the Bank of Japan in December. The trend line from early November has become a resistance level, indicating potential declines below the 150 threshold.

USDCAD 

1.4117/1.4148 Resistance

1.4020/1.3990 Support

The USD/CAD pair concluded its three-day decline yesterday, attributed to a resurgence in the U.S. dollar alongside stable oil prices. The primary moving average on the daily chart provided a foundation of support. Maintaining a position above 1.4000 presents an opportunity for bulls to recover, with notable resistance levels to observe at the 1.4100 threshold and beyond.

US crude oil futures (JAN)

69.03/69.60 Resistance

67.31/66.59 Support

Sources suggest that OPEC+ may extend its oil production cuts until the end of the first quarter in an upcoming meeting. On Monday, crude oil prices approached $69 but quickly reversed, finishing flat. The short-term trend is downward, focusing on whether prices might reach the November low near $67.

Spot Gold

2658/2670 Resistance 

2619/2607 Support

Spot Silver

30.77/30.90 Resistance 

30.37/30.25 Support

The recent rebound of the US dollar led to a drop in spot gold on Monday, retreating from above $2,650 and halting its upward trend. The next move will depend on whether it finds support near the daily moving average crossover. If supported, gold may rebound above $2,650; if not, watch for support around $2,620.

Dow Futures

45074/45249 Resistance

44481/44254 Support

The Dow futures diverged overnight from the prevailing bullish market sentiment, descending more than 100 points from their record high. Although a rise above 45,000 is possible, anticipating forthcoming U.S. employment data this week could restrict any substantial recovery.

NAS100

21386/21516 Resistance

20952/20850 Support 

On the first trading day of December, major technology firms maintained their upward trajectory. The Nasdaq regained momentum, marking two consecutive days of gains and nearing the November high. Consequently, attention is directed towards the prior peak of 21,182 to determine whether it will act as significant resistance. Regarding support, the high from last week's close to the 21,000 level acts as considerable resistance.

BTC

96855/97811 Resistance

93811/92871 Support

Bitcoin fell 1.4% to $95,864.0, ranging between $90,000 and $100,000 following new highs. Profit-taking and uncertainty about U.S. policies under a potential Donald Trump presidency, which is expected to be crypto-friendly, contributed to the decline. On the technical side, the short-term critical support is around $93811 and 92871. 

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