EURUSD
- EUR/USD Price: On Monday, EUR/USD remained subdued under the 1.0550 mark, pressured by renewed geopolitical tensions stemming from the Russia-Ukraine conflict.
- EC Growth Projections: The European Commission’s Autumn 2024 forecast maintained a 0.8% growth outlook for 2024, consistent with its Spring forecast. Growth estimates for 2025 were revised downward to 1.3% from 1.4%, reflecting cautious optimism. Looking further ahead, the Eurozone economy is projected to grow 1.6% in 2026.
- Commissioner’s statement: EU Economy Commissioner Paolo Gentiloni struck a hopeful tone, citing easing inflation, stronger private consumption, and robust investment as drivers of gradual economic acceleration.
- Fed’s Hawkish Tone: Fed Chair Jerome Powell dampened expectations for immediate rate cuts, emphasizing the economy’s resilience, a strong labour market, and lingering inflationary pressures. Powell’s comments reinforced a hawkish stance, contributing to US Dollar strength.
- FedWatch Predictions: The CME FedWatch Tool shows a 60% probability of a 25- basis-point rate cut at the Fed’s December meeting, reflecting investor caution about an imminent dovish pivot.
| SMA (20) | Falling |
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| RSI (14) | Falling |
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| MACD (12, 26, 9) | Falling |
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Closing statement: The EUR/USD remains defensive, grappling with geopolitical risks and a hawkish Fed stance. While the European Commission’s forecasts indicate long-term growth potential, near-term uncertainties, including geopolitical risks and monetary policy divergence, keep the pair under pressure. Market participants will closely monitor US inflation data and Fed commentary for further direction.
GBPUSD
- Minor Recovery: GBP/USD defends modest gains above 1.2600 in early European trading, reflecting market participants' cautious optimism. However, broader market trends remain subdued in the absence of significant economic catalysts.
- US Retail Sales: The US Census Bureau reported a stronger-than-expected 0.4% monthly increase in Retail Sales for October, surpassing forecasts of 0.3%. This data signals continued consumer strength in the US, providing support for the US Dollar.
- US Manufacturing Activity: The NY Empire State Manufacturing Index surprised markets with a sharp rise to 31.2 in November, defying expectations of a decline. The strong reading highlights resilience in the US manufacturing sector, boosting confidence in the Greenback.
- UK Interest Rate Policy: Uncertainty surrounding the Bank of England’s forward guidance on interest rates weakens demand for the British Pound. This lack of clarity may indirectly support the Euro against GBP in cross-currency trades.
- Lack of Data on Monday: Both the UK and the US face a quiet session on Monday, with no major market-moving economic releases. This might result in range-bound trading for the GBP/USD.
| SMA (20) | Falling |
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| RSI (14) | Falling |
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| MACD (12, 26, 9) | Falling |
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Closing statement: GBP/USD shows minor recovery momentum amid a quiet session, but strong US data keeps the Greenback supported. Traders should watch for fresh catalysts from upcoming UK and US economic releases to assess the pair's next direction.
GOLD
- Gold Price: After a six-day losing streak, gold price sees a modest recovery early Monday, trading below the key $2,600 mark. This recovery signals tentative demand for the safe-haven asset amid geopolitical and economic uncertainties.
- Geopolitical Tensions: US President Joe Biden’s authorization of Ukraine to use long- range ATACMS to strike Russia, coupled with Moscow’s deployment of North Korean troops, escalates geopolitical tensions. These developments provide underlying support for gold as a risk hedge.
- China’s Stock Market Boost: Efforts by China’s CSRC to expand stock trading options through the Shanghai-Hong Kong Stock Connect aim to enhance market activity. Increased Chinese market confidence indirectly benefits gold by signaling broader economic stability in a key consumer market.
- USD Strength: The US Dollar surged to its highest level in a year, driven by inflationary expectations from President-elect Trump’s fiscal and trade policies. A stronger Greenback typically weighs on gold's price, as it becomes more expensive for non- USD buyers.
- FedSpeak: Traders await comments from Chicago Fed President Austan Goolsbee for clues about monetary policy direction. In the absence of significant economic data, this speech could shape short-term sentiment for gold prices.
Closing statement: Gold is attempting a rebound amid geopolitical tensions and Chinese economic measures but faces headwinds from USD strength. The focus now shifts to upcoming Fed commentary, which could influence gold's trajectory in the near term.
CRUDE OIL
- WTI Price: WTI crude prices show stability above $67.00 per barrel during Monday’s European session, rebounding slightly from recent declines. This reflects cautious optimism amid a complex geopolitical and economic backdrop.
- Geopolitical Tensions: Russia’s largest airstrike on Ukraine in three months and the deployment of 50,000 troops in Kursk, bolstered by North Korean forces, elevate regional instability. These developments add upward pressure on crude prices due to potential supply disruptions.
- US Authorization: US President Biden’s approval for Ukraine to use ATACMS for strikes within Russia heightens geopolitical risks. While supportive of oil prices in the short term, sustained tensions could strain global energy logistics.
- Fed’s Hawkish Tone: Fed Chair Jerome Powell’s emphasis on economic resilience, a strong labor market, and persistent inflation reduces expectations for imminent rate cuts. This reinforces USD strength, indirectly weighing on crude oil demand.
- Weak Chinese Demand: Concerns over China’s economic outlook, exacerbated by the lack of stimulus in its recent 10 trillion Yuan debt package, fuel bearish sentiment in the oil market. Weaker demand from the world’s largest importer remains a key downside risk.
| SMA (20) | Slightly Falling |
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| RSI (14) | Slightly Falling |
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| MACD (12, 26, 9) | Falling |
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Closing statement: Crude oil prices are finding a floor above $67.00 amid escalating geopolitical tensions, but demand concerns from China and a strong USD are capping gains. Market focus now shifts to further geopolitical developments and economic indicators for additional direction.
DAX
- DAX Price: The DAX reversed part of its previous session's gains, dropping 0.27%. This decline reflects market concerns over diminishing expectations for a December Fed rate cut and the lingering threat of US tariffs on EU and Chinese goods.
- Pharma Stocks: Sartorius AG led losses with a 6% decline, while Qiagen and Merck fell by 2.49% and 2.22%, respectively. Investor sentiment soured following RFK Jr.'s appointment to head the Department of Health and Human Services, given his critical stance on Big Pharma and vaccines.
- German Wholesale Price: October’s wholesale prices fell 0.8% year-on-year, a slower decline than September’s 1.6%. This improvement may reduce the likelihood of a substantial December ECB rate cut as policymakers weigh inflationary risks tied to US trade policies.
- Eurozone Trade Data: Monday’s Eurozone trade balance report is expected to show a widening surplus, potentially improving sentiment for German exporters. A favorable trade outlook could provide near-term support for the DAX.
- ECB Commentary: Comments from ECB Vice President Luis de Guindos and Chief Economist Philip Lane regarding December rate cut possibilities may significantly influence investor sentiment. These remarks are closely tied to the outlook for inflation and growth in the Eurozone.
| SMA (20) | Rising |
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| RSI (14) | Neutral | ||
| MACD (12, 26, 9) | Neutral |
Closing statement: The DAX faces headwinds from geopolitical trade risks and sector-specific declines, particularly in pharmaceuticals. However, a potential improvement in Eurozone trade data and moderated ECB rate cut expectations could offer stabilization or support in the near term.