ATFX Market Outlook 5th December 2024 

ATFX Market Outlook 5th December 2024 

Wall Street's Record Highs Driven by Powell's Remarks

U.S. stock index futures approached record highs on Wednesday, following Wall Street's gains driven by the tech sector and positive remarks from Federal Reserve Chair Jerome Powell. Powell's comments, likely the last before the Fed's December meeting, indicated cautious optimism about inflation and economic strength amid market uncertainties. Moreover, the Federal Reserve's Beige Book noted slight economic expansion since early October, with slow employment growth and minor inflation increases. All major U.S. stock indexes set record highs, with the Dow up 0.69%, the S&P 500 rising 0.61%, and the Nasdaq climbing 1.3%.

Powell noted the economy's unexpected strength, allowing for cautious interest rate cuts. The U.S. dollar index held steady at 106.33, while USD/JPY rose 0.6% to 150.52. Gold prices edged up to $2,649.79 per ounce amid a modest Fed rate cut path, while oil prices fell nearly 2% ahead of OPEC+'s production cut decision despite a larger-than-expected drop in U.S. crude inventories.

Investors are watching the Eurozone's October retail sales for a potential fourth consecutive month of growth, indicating that the European Central Bank's rate cuts are supporting consumer spending and guiding the Euro in the short term. Tonight, they'll also look at US initial jobless claims to gauge labor market health and set expectations for tomorrow's non-farm payrolls report.

[Financial data and events of significant concern] 

15:00 EU Germany Factory Orders OCT **

18:00 OPEC Meeting *** 

18:00 EU Retail Sales OCT ** 

21:30 US Initial Jobless Claims ***

Tomorrow

21:30 US Non-Farm Payrolls NOV *** 

23:00 US Michigan Consumer Sentiment Prel DEC *** 

EURUSD

1.0567/1.0598 Resistance

1.0465/1.0433 Support

The EUR/USD pair finds support at 1.0500 after a sharp decline. It rebounded to 1.0530 but remained below the 20-day SMA, which acts as resistance. Indicators show lingering bearish momentum, with the RSI at 42. Traders will monitor for bullish momentum to regain the 20-day SMA; on the technical side, the pair may retest 1.0500 and 1.0450 if it fails to break out 1.0550 resistance.

GBPUSD

1.2743/1.2771 Resistance

1.2654/1.2626 Support

Bank of England Governor Andrew Bailey suggested that interest rates may gradually decrease over the next year. The GBP/USD pair has rebounded over the past two days, but the trend is moderate ahead of US job data. Today, if it breaks above the 20-day moving average, it could rise toward last week's high of 1.2750; otherwise, it may retreat to lower support.

USDJPY

151.47/151.96 Resistance

149.92/149.44 Support

Yesterday, the US dollar recorded its largest gain against the yen in three weeks, bouncing off a downward trend line that has now become support. It will soon face resistance at the 10-day moving average of 151.47. If it fails to break through, it may drop back below the 150 mark.

USDCAD 

1.4101/1.4124 Resistance

1.4024/1.4000 Support

The USDCAD pair showed minimal fluctuations. Yesterday, it remained near a one-week high before ending slightly lower by the close of the trading session. From a technical standpoint, the resistance level between 1.4080 and 1.4100 is limiting the current upward trend. If the weakness continues throughout the day, it is important to observe the key support level at the 10-day moving average, which stands at 1.4030.

US crude oil futures (JAN)

69.41/69.82 Resistance

68.09/67.67 Support

Crude oil prices plunged over 2% to $70 before a slight rebound, triggered by EIA data revealing record U.S. production. The resistance at $69 might cause further drops, potentially testing last week's low of $67.74. The upcoming OPEC meeting is anticipated to offer more direction.

Spot Gold

2663/2676 Resistance 

2632/2619 Support

Spot Silver

31.62/31.75 Resistance 

31.10/31.00 Support

The U.S. dollar showed little change overnight, while spot gold rose slightly, closing trade near $2,650. It continues to trade within a narrow range between two moving averages, indicating no significant change in signal. Traders may need to wait for Friday's non-farm payrolls report to find the trading direction.

Dow Futures

45249/45430 Resistance

44659/44481 Support

U.S. stocks climbed overnight, fueled by Powell's speech and strong data. The Dow closed above 45,000 points for the first time but needs to exceed 45,080 to gain upward momentum against resistance at 45200. Investors should brace for potential corrections ahead of Friday's U.S. non-farm payroll report.

NAS100

21615/21717 Resistance

21282/21181 Support 

Driven by positive financial reports from both the AI ​​application and chip sectors overnight, the Nasdaq opened higher yesterday and hit a new high, closing close to the 21,500 mark. The market is expected to continue to be optimistic during the day. At present, pay attention to whether the Nasdaq continues to point to the resistance above 21,600, but investors are also waiting to see tomorrow's non-farm payrolls report.

BTC

99968/100739 Resistance

97397/96790 Support

Bitcoin rose 0.4% to $95,611.00 on Wednesday, boosted by President-elect Donald Trump's plan to appoint Paul Atkins as SEC Chair. Fed Chair Powell's comments about a potential rate cut also lifted Bitcoin in early Thursday trading. While traders are hopeful for friendlier crypto policies, including a Bitcoin national reserve, scepticism remains about Trump's ability to deliver on these promises. Bitcoin will likely stay range-bound between $91,000 and $100,000 before not breaking the $100,000 mark.

Enjoy trading! The content is for reference only. Please ensure that you understand the risk.

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