USD

This Thursday, the U.S. dollar rose within a very narrow range. The Dollar Index, which measures the value of the dollar against six major currencies, rebounded to above 106.00 after a significant sell-off the previous day. The remaining trading days of the week are expected to be very calm with Thanksgiving and Black Friday occurring. Liquidity will be low as most major U.S. trading floors will be closed. Influenced by lower U.S. Treasury yields and investors adjusting end-of-month capital flows, the dollar faced strong and abrupt downward pressure, with the Dollar Index falling to a multi-day low and Treasury yields weakening further, breaking below the 106.00 support level. U.S. markets will be closed for the Thanksgiving holiday, and the dollar continued to fall as traders preferred not to hold positions heading into the long Thanksgiving weekend. However, the downside potential for the dollar may be limited, as the Federal Reserve may be cautious about cutting rates following strong U.S. inflation data.

From the daily chart, the technical indicators, 14-day Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD), have been struggling to rise recently and seemed to give up on Wednesday as the index fell back to 106.00. This suggests that the index may need some time to consolidate. However, the index remains near the 20-day (105.86), 100-day (103.24), and 200-day (104.02) simple moving averages, indicating that the overall momentum is still positive. The Dollar Index is expected to find support at 105.53 (25-day moving average) - 105.50 (psychological market level) and face resistance in the 106.64 (10-day moving average), and 107.00 (round number) areas.

Today, consider shorting the Dollar Index around 106.30, with a stop loss at 106.45 and targets at 105.85, 105.75.

WTI Spot Crude Oil

This Thursday, crude oil prices rose following headlines that Israel had breached the ceasefire agreement in Gaza. In the meantime, OPEC and its allies (OPEC+) have confirmed that they will delay the decision of the upcoming output policy meeting from Sunday to December 5th. WTI crude oil prices remained steady as a surprisingly large decrease in crude inventories offset the ceasefire agreement between Israel and Hezbollah. The oil market may be calm due to the Thanksgiving holiday. The latest U.S. economic indicators suggest that the market expects the Federal Reserve to keep interest rates unchanged in its January and March meetings. Notably, a slower-than-expected pace of interest rate cuts could keep borrowing costs high, potentially slowing economic activity and reducing oil demand. Israel approved a ceasefire agreement with Hezbollah militants, which will end nearly 14 months of fighting related to the war in Gaza, effective Wednesday. The easing of geopolitical risks may put pressure on WTI oil prices. However, a decrease in U.S. crude inventories last week could boost oil prices.

The current issue is when OPEC+ can again control the direction of oil prices, as the market has already anticipated that statements in March and later in 2025 will be postponed again. Without additional measures to restrict supply, it is unlikely that oil prices will recover. On a positive note, $70.00 (psychological market level) and $71.03 (80-day moving average) are key levels. A breach could target the major resistance at the $72.26 100-day simple moving average. The October 3rd high of $73.77 might also be tested. On the other hand, traders need to look at $67.12—the level that held prices in May and June 2023—to find the first support. If breached, it could reach the $66.57 level (October 29th low).

Today, consider going long on crude oil around $68.65, with a stop loss at $68.50 and targets at $69.90; $70.00.

XAUUSD

On Thursday, gold traded around $2,640, continuing a shallow recovery from Tuesday's low. Gold prices rose amidst market bets that the Federal Reserve will continue to cut rates at its December meeting. Gold prices retraced from their mid-week rebound to $2,658 and dipped in Thursday's Asian session. Mid-week U.S. macroeconomic data suggested that the U.S. economy remains robust and inflation progress is stalled. This indicates that the Federal Reserve may be cautious about further rate cuts, triggering a slight rebound in U.S. Treasury yields, which helps revive dollar demand and weaken non-yielding gold. However, the market still believes it is more likely that the U.S. central bank will reduce borrowing costs by 25 basis points in December. Additionally, the threat of tariffs by the U.S. President-elect has heightened concerns about a reignition of a trade war between the world’s largest economies, which could undermine global economic growth. This factor, coupled with the ongoing geopolitical risks from the protracted Russia-Ukraine conflict, helps keep safe-haven gold prices above the $2,600 level.

From the daily chart, gold peaked at $2,658 mid-week but failed to break through the $2,663.40 area (50.0% Fibonacci retracement from 2790.00 to 2536.80) before retracing to $2,620. Moreover, bearish oscillators on both hourly and daily charts suggest that the path of least resistance for gold prices is downward. The first gold support zone is at $2,600 and $2,596.50 (23.6% Fibonacci retracement level). If bearish again, it might fall near the 100-day moving average of $2,571.00. On the other hand, if it breaks the recent high near the 20-day moving average of $2,649.50, gold seems to face strong resistance near the overnight oscillation high of $2,658. If it continues to strengthen and breaks through the latter, gold prices may rise to the next relevant level near $2,677-$2,678, and then to the round figure of $2,700.

Today, consider going long on gold around $2,636.00, with a stop loss at $2,632; targets at $2,653.00; $2,655.00.

AUDUSD

During Thursday's European trading session, the AUD/USD struggled around 0.6500, reversing its earlier uptrend. Recent weakness in the dollar has helped stabilize the Australian dollar. However, as the U.S. is set to announce further sanctions on Chinese artificial intelligence chips on Monday, buyers have become cautious amidst the U.S.-China trade war. Mid-week, the dollar faced significant downward pressure, interrupting Tuesday's upward momentum and falling near the lower end of the weekly trading range, due to end-of-month fund flows ahead of the Thanksgiving holiday. In contrast, the Australian dollar regained balance, retesting the critical 0.6500 level, indicating a broad rebound in risk assets, while key Australian exports like copper and iron ore slightly rose. If the Federal Reserve signals a shift to rate cuts, the AUD/USD could find relief. However, risks remain. Inflationary pressures from U.S. policy changes and a resilient dollar could continue to pressure the Australian dollar. Additionally, the stance of the Reserve Bank of Australia remains cautious. RBA Governor Lowe reiterated that the tight monetary policy will continue until inflation shows sustained improvement.

From the daily chart, if bulls regain short-term control, the next resistance levels will be the weekly high of 0.6549 (November 25), and 0.6540 (25-day moving average), followed by the key psychological level of 0.6600. The next level will point to the 200-day moving average of 0.6628 and the November high of 0.6687 (November 7). On the other hand, as the 14-day Relative Strength Index (RSI) remains below 45, indicating continued negative sentiment, initial support for the pair comes from the November low of 0.6434 (November 26), followed by the round number level of 0.6400.

Today, consider going long on the Australian dollar around 0.6485, with a stop loss at 0.6475; targets at 0.6540; 0.6550.

GBPUSD

The GBP/USD struggled to gain traction, moving sideways and breaking below 1.2700 on Thursday. The dollar strengthened after a significant drop on Wednesday, preventing the currency pair from gaining traction. U.S. market trends may continue to be subdued. Mid-week, the GBP/USD finally broke above 1.2600 as the bullish dollar trend receded, allowing the GBP/USD to rise. Economic data from the UK remains sparse, and after U.S. data largely met expectations on Wednesday, the market is expected to remain calm for the rest of the week. Investors will see significantly limited market liquidity on Thursday and Friday: U.S. markets will be closed for Thanksgiving on Thursday, and trading will be light on Friday with most U.S. exchanges shortening trading hours. Next week's data schedule in the UK is similarly sparse, with investors turning their attention to a new round of U.S. non-farm payroll data on the following Friday, with a lot of anticipation building around the employment data.

On Wednesday, the GBP/USD rose nearly one percent, reclaiming the position above the 1.2600 level, and is poised to challenge the 1.2700 (round number) level. GBP/USD bulls started a new rally after a straight 7% drop from the high point of 1.3434 in September. However, bullish positions will face new challenges near 1.2743 (20-day moving average) and 1.2800 (psychological market level), looking further up to the 200-day moving average at 1.2819. The 14-day Relative Strength Index (RSI) on the daily chart remains below 45, indicating continued negative sentiment. Regarding its support, the pound could be pulled back to 1.2600 (psychological market level), and 1.2550, or even the November 22nd low of 1.2487.

Today, it is advised to go long on the pound before 1.2675, with a stop loss at 1.2660, and targets at 1.2730, 1.2740.

USDJPY

The USD/JPY has stagnated in recovery from an earlier one-month low on Thursday. Concerns about the economic impacts of tariffs promised by Trump and geopolitical risks continue to support the safe-haven Japanese yen, while the dollar licks its wounds as U.S. Treasury yields fail to rebound during Thanksgiving. During the Asian session, the yen slightly weakened against the dollar and lost some of the gains made from the five-week high reached the previous day. Due to the lack of new fundamental catalysts, the yen's decline during the session is likely to remain limited as the market speculates that the Bank of Japan may raise interest rates again in December. Furthermore, tariff threats and geopolitical risks from U.S. President-elect Donald Trump could also support the yen's safe-haven sentiment. Meanwhile, Wednesday's U.S. macroeconomic data did almost nothing to ease market expectations that the Federal Reserve will lower borrowing costs by 25 basis points in December. This led to a further slide in U.S. Treasury yields, pushing the dollar to a two-week low, which may benefit the low-yield asset yen ahead of Friday's Tokyo inflation data release.

A drop below the crucial 200-day moving average (152.00) overnight could be seen as a key bearish trigger. Moreover, daily chart oscillators have just begun to gain bearish momentum, supporting the prospects for a further retracement in USD/JPY. However, any further rise is likely to continue facing resistance near the 152.00 mark (200-day moving average), with spot prices possibly climbing to the 152.60 area, and then to the 153.00 and 153.30 levels. On the other hand, the mid-week low near 150.45, followed by the psychological level of 150.00, currently seems to provide support. If this level is breached, USD/JPY could fall to the intermediate support between 149.40-149.35, and then near the round figure area of 149.00.

Today, it is recommended to short the dollar before 151.75, with a stop loss at 151.95; targets at 150.80, 150.70.

EURUSD

During Thursday's U.S. session, the EUR/USD experienced narrow fluctuations around 1.0550. Weak inflation data from Germany made it difficult for the euro to strengthen, limiting the upward potential of the pair, while U.S. markets remained closed due to the Thanksgiving holiday. Mid-week, the EUR/USD strengthened, breaking back above the 1.0500 level. The euro's bullish rebound was primarily due to recent easing pressure from a stronger dollar rather than inherent strength in the euro itself. U.S. markets were closed for Thanksgiving on Thursday, and trading hours will also be shortened on Friday. The U.S. GDP growth rate for the third quarter was recorded at an annualized 2.8%, meeting market expectations and barely impacting investors. The core personal consumption expenditures (PCE) index accelerated to 2.8% as of October, also in line with expectations. Euro traders look forward to Friday’s preliminary data on the Eurozone consumer price index (HICP) with a mix of hope and despair. The market generally expects Eurozone inflation to rise in the short term, which will further constrain the prospects for rate cuts by the European Central Bank, while ECB policymakers are struggling to find reasons to boost investor confidence in the European economy.

Mid-week bullish sentiment in the Eurozone provided an opportunity for the euro to rise, moving further away from the recent low of 1.0400, though the increase was modest. EUR/USD is gearing up to test 1.0600 and 1.0610 {November 20 high}. The next resistance level to watch is 1.0666 {25-day moving average}, and once this key technical level is effectively breached, it points directly to the 34-day moving average at 1.0713. Meanwhile, the 14-day Relative Strength Index (RSI) on the daily chart showed a rebound after conditions turned oversold (latest report at 41.60). However, this oscillator has cooled down, which might allow bears to dominate the market again. The first support level for the pair will remain at 1.0500 (round number), followed by 1.0475 {Wednesday low}.

Today, it is advised to go long on the euro before 1.0540, with a stop loss at 1.0525, and targets at 1.0585, 1.0600.

Disclaimer: The information contained herein (1) is proprietary to BCR and/or its content providers; (2) may not be copied or distributed; (3) is not warranted to be accurate, complete or timely; and, (4) does not constitute advice or a recommendation by BCR or its content providers in respect of the investment in financial instruments. Neither BCR or its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.