USD

The US Dollar Index, which measures the value of the dollar against a basket of six major currencies, failed to extend its gains for the sixth consecutive day during last week's volatile trading. Federal Reserve Chair Jerome Powell's reservations about a potential rate cut in December introduced uncertainty to the market, which is now assessing new retail sales data. After reaching this year's peak at 107.07, the Dollar Index slightly retreated. However, supported by cautious comments from the Fed and strong economic data, the index remains on an upward trajectory, giving the dollar an edge over its peers.

The dollar's sharp post-election rally saw some pullback, reflecting a minor shift in short-term US interest rates, possibly due to some consolidation in bullish dollar positions. Following the US election, the dollar made significant gains in a short period, with pre-election dollar advances against major currencies already appearing excessive. Based on weighted short-term yield spreads, the Dollar Index is trading slightly above its estimated fair value, but the margin is not significant. Most of the positive interest rate differential news for the dollar may have already been priced in. Once the new administration outlines its policy priorities, further dollar strength remains a possibility, meaning downside risks for the dollar could currently be limited. Regardless of the dollar's current robust valuation, its outlook remains favorable in the short term, supported by the US fiscal/monetary policy mix and tariff risks.

From the daily chart, the Dollar Index surged to a yearly high of 107.07 last week but quickly faced profit-taking, signaling a potential shift in market sentiment. This pullback suggests that bullish momentum may have become overstretched, raising the possibility of a correction. Indicators such as the 14-day Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) continue to show overbought conditions, making further consolidation likely. The Dollar Index saw a slight technical pullback before the weekend but remains supported by Powell’s comments, which suggest a potential pause in the rate-cut cycle, reinforcing the dollar’s status as a high-yield currency compared to its peers.

On the upside, the 10-week and 20-week moving averages are forming a bullish "golden cross" pattern. The 107.00 psychological level and last week’s high of 107.07 continue to act as the initial resistance zone. If these levels are breached, the next target is 107.18 (the 50.0% Fibonacci retracement level from 114.78 to 99.57), with the potential to reach the two-year high at 108.00. On the downside, a series of new support levels are coming into play. The first support is at 106.00 (psychological threshold) and 105.95 (upward trendline from this year’s low at 100.16). Slightly lower, the key support at 105.38 (38.2% Fibonacci retracement level) should prevent further declines to the 104.95 level (last week’s low).

For today, consider going long on the Dollar Index around 106.60, with a stop-loss at 106.45 and targets at 106.95 and 107.00.

WTI Spot Crude Oil

Last week, WTI crude oil prices remained below $70.00 for four consecutive trading days after dropping from the early-week high of $70.35, hitting a nearly three-week low of $66.80. WTI crude is currently oscillating narrowly around $68.00. The sharp decline in U.S. fuel inventories offset concerns about oversupply, keeping WTI prices stable. According to the Energy Information Administration (EIA) weekly report, crude oil inventories increased. For the week ending November 8, U.S. crude inventories rose by 2.089 million barrels, compared to a 2.149 million barrel increase in the previous week. Meanwhile, U.S. gasoline inventories hit a two-year low.

In the short term, a stronger U.S. dollar might limit the upside potential for dollar-denominated oil prices, as it makes oil more expensive for holders of other currencies, reducing demand. Recent market reports suggest that crude oil futures are attempting to establish equilibrium pricing, as the rising U.S. dollar index is creating additional resistance. Furthermore, with the Trump administration now set to control Congress, it is likely to overturn much of the Biden administration's energy policies. Additionally, the Organization of the Petroleum Exporting Countries (OPEC) recently lowered its demand growth forecast, which may further weigh on WTI prices. With Donald Trump set to become the next U.S. president in January 2025, crude prices could enter a bearish cycle.

As oil prices failed to break above $73.36 (the 89-day moving average), bullish momentum has weakened. However, the technical indicator—the 14-day Relative Strength Index (RSI)—is consolidating around 39.00–40.00, indicating bearish tendencies are still in play. On the upside, WTI prices may attempt to re-enter the $69.25 range (23.6% Fibonacci retracement level). A breakout could push toward $70.00, a key psychological level, with the medium-term target being $72.36 (89-day moving average).

On the support side, WTI prices could test the $66.18 level (October 1 low). A break below these levels would increase downward pressure on prices, with additional support near $64.75 (September 10 low). The next support level is at $64.31 (May 4 low).

Recommendation for Today: Consider shorting crude oil around $67.10, with a stop-loss at $67.30 and targets at $66.00 and $65.80.

XAUUSD

Gold recorded its worst weekly performance in over three years last week due to expectations of a slower pace of Fed policy easing. Late last week, gold dropped below $2,600.00, hitting a three-month low of $2,536.00, driven by a strengthening U.S. dollar and reduced expectations for Federal Reserve rate cuts. Spot gold closed at $2,555.00 per ounce, down over 4.58% for the week. Gold prices also hit a two-month low in the previous session, having fallen more than $250 from last month’s record high of $2,790. Following Donald Trump’s election victory, the surging U.S. dollar has made gold more expensive for investors holding other currencies.

Gold’s continued weakness is tied to market expectations that U.S. monetary policy will be more restrictive once Trump takes office in 2025. While Fed Chair Powell’s comments could limit gold’s upside as the new year approaches, the potential for a turbulent new term under President Trump might attract safe-haven inflows. This week, with no major events in the U.S., gold may see a technical rebound and retest the $2,600 level. The strong dollar is clearly weighing on gold, and while prices are holding above the 100-day moving average ($2,545.60), the downward momentum remains strong. Investors should remain vigilant for further downside risks and monitor buying interest near this support level.

Gold broke below $2,600 (a key psychological level) late last week, reaching a three-month low of $2,536. It subsequently rebounded near the 100-day simple moving average ($2,545.60) and attempted recovery. However, gold remains in a short- to medium-term downtrend. The 14-day Relative Strength Index (RSI) is above 30 (currently at 33.20), indicating potential oversold conditions. If RSI falls below 30, it could signal a deeper oversold condition, possibly leading to an upward correction.

At present, gold may find critical support near $2,536 (three-month low) and $2,526 (110-day moving average). A break below this psychological level could amplify downward pressure, driving the price toward $2,500 (a key round number and near the 127-day moving average). On the upside, initial resistance lies near $2,588 (a downtrend channel middle line). If gold rebounds and breaks above this resistance, it could target $2,594.60 (75-day moving average) and $2,595.90 (23.6% Fibonacci retracement from $2,790 to $2,536). A breakout could further target $2,633 (38.2% Fibonacci retracement).

Trading Recommendation for Today: Consider going long on gold around $2,558.00, with a stop-loss at $2,554.00 and targets at $2,580.00 and $2,585.00.

AUDUSD

By the end of last week, the Australian dollar experienced a technical rebound as the U.S. Dollar Index retreated from its annual high. However, recent weak domestic and Chinese economic data may pose challenges for the Australian dollar. On the positive side, Reserve Bank of Australia (RBA) Governor Michele Bullock stated that the current interest rates will remain unchanged until the bank has full confidence in the inflation outlook. Weak Australian labor market data released last Friday showed an increase of 8,100 in unemployment for October, exacerbating concerns over the strength of the Australian economy. Coupled with disappointing Chinese data, this may limit the Australian dollar's recovery in the short term. Despite these headwinds, recent hawkish remarks from RBA Governor Bullock could provide some support for the Australian dollar, as she hinted at the possibility of further rate hikes to curb inflation.

Last week, the AUD/USD pair hovered near a nearly four-month low of 0.6444. However, the decline of the Australian dollar might be limited due to the less dovish comments made by RBA Governor Michele Bullock on Thursday. Bullock stated that the current restrictive rates will remain in place until the central bank is confident in its inflation outlook. Despite signs of a slowdown in the “Trump trade,” the U.S. dollar remains steady near its 2024 highs.

Last Friday, AUD/USD traded around 0.6460. Daily chart analysis shows short-term downward pressure on AUD/USD last week, with the pair oscillating around 0.6450. The pair remains below the 200-day moving average (0.6629) and the 14-day moving average (0.6558). Additionally, the 14-day Relative Strength Index (RSI) is above 30, indicating potential oversold conditions. If the RSI falls below 30, it could signal oversold conditions, suggesting a potential upward correction. At this stage, AUD/USD may find key support near 0.6400 (a round-number level). A break below this psychological level could amplify downward pressure, pushing the pair to the annual low of 0.6348 last seen on August 5. Immediate resistance is at the psychological level of 0.6500. A breakout above this level could drive the pair toward the 14-day moving average at 0.6558, followed by the 200-day moving average high at 0.6629. Surpassing these moving averages could pave the way toward the market barrier at 0.6700.

Trading Recommendation for Today: Consider shorting the Australian dollar around 0.6470, with a stop-loss at 0.6485 and targets at 0.6410 and 0.6400.

GBPUSD

Last week, GBP/USD fell to near a 5-month low around 1.2597. The cautious remarks by Federal Reserve Chair Jerome Powell on Thursday, coupled with strong U.S. economic data, broadly boosted the U.S. dollar, putting pressure on GBP/USD. UK labor market data mostly exceeded expectations, but wage growth heightened inflation concerns. Although the number of unemployment claims was below expectations, the number of people seeking unemployment benefits still increased compared to last month's revised figures.

The UK economy showed minimal growth in Q3, with a quarterly growth rate of just 0.1%, a sharp slowdown from 0.5% in Q2. Weak growth this quarter was driven by a slump in the services sector, with GDP falling 0.1% month-on-month in September. The services sector, the engine of the UK economy, grew by only 0.1% in the previous quarter, while construction surged by 0.8%. There was some good news, however, as private consumption increased, and fixed capital formation (investment) was strong. Business investment also performed well, with a quarterly growth rate of 1.2%, which could help trigger the next phase of growth.

Last week, GBP/USD fell below the critical 200-day moving average (1.2819) on the daily chart and dropped to near a 5-month low around 1.2630. With the 14-day Relative Strength Index (RSI) positioned near the midline at 32.00, the short-term outlook remains bearish. Thus, downside resistance for the pound is minimal. Sustained bearish momentum may drag the pair to last Thursday's low of 1.2630 and the psychological support level of 1.2600. A break below this level could push the price toward 1.2509 (May 9 low) and 1.2500 (psychological level), followed by the May 8 low of 1.2467.

On the upside, if buyers step in at this level, the first key resistance to watch will be the November 14 high of 1.2720. A break above these obstacles could pave the way to test 1.2819 (23.6% Fibonacci retracement of 1.3434 to 1.2630 and the 200-day moving average). Any follow-up buying above this level could open the door to the November 12 high of 1.2873.

Trading Recommendation for Today: Consider shorting GBP/USD around 1.2625, with a stop-loss at 1.2640 and targets at 1.2560 and 1.2550.

 USDJPY

Before the weekend, the Japanese yen appreciated as the U.S. dollar weakened ahead of retail sales data. Japan's Q3 GDP annualized growth rate came in at 0.9%, down from Q2's 2.2%. Japanese Finance Minister Shunichi Kato stated he would take appropriate action to address excessive exchange rate fluctuations. However, late last week, following the release of Japan's Q3 GDP data, the yen continued its downward trend against the dollar. The stronger dollar supports the upward potential of USD/JPY.

Japan's Q3 GDP preliminary data showed a quarter-on-quarter growth of 0.2%, below the previous quarter's 0.5%, in line with market expectations. The annualized growth rate for Q3 was 0.9%, exceeding the consensus forecast of 0.7% but significantly slower than Q2's 2.2%. Japanese Finance Minister Kato stated on Friday that he would take appropriate action against excessive forex rate fluctuations. He emphasized the importance of stable exchange rate movements reflecting economic fundamentals and expressed concerns over one-sided, sharp market movements. Meanwhile, Economy Minister Yasutoshi Nishimura stated that the economy is expected to continue its moderate recovery, driven by improvements in employment and wages. However, Nishimura also stressed the need to closely monitor potential downside risks from the globalized economy as well as financial and capital market volatility.

USD/JPY climbed to near a four-month high of 156.75 last Friday. In the short term, the pair remains bullish, trading within a rising trendline pattern with repeated strengthening. The 14-day Relative Strength Index (RSI) significantly retreated to around 58.00 on the last trading day of last week but remains in a bullish trajectory. If the RSI escapes the 70 level, it could signal overbought conditions, potentially leading to a downward correction in USD/JPY.

At present, USD/JPY is highly likely to target the 157.86 level (July 19 high). Breaking this level would reinforce bullish momentum and could push USD/JPY toward 160.00 (a psychological level), eventually aiming for the four-month high of 161.95 recorded on July 3. On the downside, USD/JPY may find initial support near 153.56 (14-day moving average), followed by 152.70 (23.6% Fibonacci retracement of 161.95 to 139.58) and 152.75 (October 29 low). A break below these levels would target 150.19 (38.2% Fibonacci retracement) and 150.00 (psychological level).

Trading Recommendation for Today: Consider shorting USD/JPY around 154.50, with a stop-loss at 154.70 and targets at 153.50 and 153.10.

EURUSD

Before the weekend, EUR/USD remained in a positive stance as profit-taking by dollar shorts pressured the greenback. Nevertheless, Jerome Powell's hawkish shift and optimistic U.S. data kept the dollar on a bullish trajectory. Last week, EUR/USD briefly broke below the critical support level of 1.0500, reaching a 2024 low of 1.0496, driven by the dollar's strength, as the U.S. Dollar Index hit an annual high above 107.00. EUR/USD ended a five-day losing streak, trading near 1.0500 before the weekend. This technical rebound was likely due to a correction in the dollar following comments by Federal Reserve Chair Jerome Powell, who stated that the recent performance of the U.S. economy was "very good," allowing the Fed to gradually lower rates.

The U.S. Dollar Index, which tracks the dollar against six major currencies, retreated from its yearly high of 107.06 recorded last Thursday. This decline was attributed to a slowdown in the "Trump trade." Currently, the Dollar Index is trading near just below the 107.00 level. On the other hand, minutes from the European Central Bank's (ECB) October monetary policy meeting showed increasing consideration of rate cuts. However, ECB officials remain cautious about domestic inflation pressures, citing strong wage growth and weak labor productivity. The ECB emphasized the need to gather more data before implementing any policy changes.

EUR/USD rebounded after hitting a 2024 low of 1.0496 last week and is now trading back above 1.0500, driven by some short-covering. The current rise appears corrective and may continue in the upcoming sessions. However, the 14-day Relative Strength Index (RSI) remains near 28.50, indicating bearish momentum persists with a downward risk bias.

The pair has been steadily declining, further distancing itself from the firmly bearish 10-day simple moving average (1.0694), which remains below the 200-day moving average (1.0864). At the same time, technical indicators suggest oversold conditions. If EUR/USD continues to decline, it may retest the 2024 low at 1.0496 (November 14), followed by the 2023 low at 1.0448 (October 3). Ultimately, it could challenge the 1.0400 psychological level.

On the upside, EUR/USD may first aim for the 10-day simple moving average at 1.0694, with initial resistance at 1.0600 (psychological level). A breakout above the 10-day moving average resistance could target the 200-day moving average region at 1.0864.

Trading Recommendation for Today: Consider shorting EUR/USD around 1.0540, with a stop-loss at 1.0560 and targets at 1.0500 and 1.0490.

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