Daily Global Analysis By zForex

[Z Forex]

USD/JPY Analysis by zForex Research Team - 11.15.2024​

Yen Weakens on Q3 Low Growth​

The Japanese yen weakened past 156 per dollar on Friday, its lowest in nearly four months, after Japan's Q3 GDP grew just 0.2%, down from 0.5% in Q2. Annual growth slowed to 0.9% from 2.2%. Uncertainty about the Bank of Japan's policy direction, combined with a stronger US dollar, kept pressure on the yen. The BoJ still expects to raise rates to 1% by mid-2025, despite mixed economic data and political instability.

For USD/JPY, support levels are at 154.50 (200-day moving average), 153.40, and 152.30, while resistance is at 156.50, 157.30, and 158.50.

 

[Z Forex]

Weekly Analysis by zForex Research Team - 11-15 November​

Dollar Strengthens on Election Hopes, Euro and Pound Weaken​

The dollar index closed higher with expectations of inflationary policies under Trump’s presidency.

The euro weakened due to political uncertainty, below-target inflation, and Trump’s victory. The pound also declined following the rate cut but recovered slightly.

Non-yielding assets suffered losses as Trump’s election raised hopes for higher interest rates. Concerns about US-China tensions pressured silver prices, given China’s role as the largest importer.

US 10-year Treasury yields initially surged but retreated, while 2-year yields closed higher for the week.

RBA Interest Rate Decision (Nov)​

The Reserve Bank of Australia (RBA) kept its cash rate at 4.35% during its November meeting, maintaining borrowing costs for the eighth consecutive time, as expected. While headline inflation has dropped and is projected to stay low, core inflation remains high, prompting caution about inflationary pressures. The RBA noted monetary policy will remain restrictive until inflation is confidently on track toward the target. Signs of increased Q3 household spending were observed, but a slower rebound could lead to weak growth and labor market issues. The interest rate on Exchange Settlement balances stayed at 4.25%.

S&P Global Services PMI (Oct)​

US service providers saw solid business growth as Q4 began, with new orders maintaining September’s pace despite weaker international demand. Business activity expectations rose from a 23-month low, but companies reduced staffing slightly amid future demand uncertainty. The S&P Global US Services PMI Business Activity Index indicated strong growth in October, slightly down to 55.0 from 55.2 in September, marking 21 consecutive months of expansion. New orders increased for the sixth month, though export growth was slower due to subdued demand.

ISM Non-Manufacturing PMI (Oct)​

In October, the Services PMI reached 56%, up by 1.1% from September’s 54.9%. This marks the eighth occasion this year that the composite index has remained in expansion territory.

BoE Interest Rate Decision (Nov)​

The Bank of England cut its Bank Rate by 25bps to 4.75% in its November 2024 meeting, the second cut since August. Eight of nine MPC members supported the move, exceeding the expected seven votes, with Catherine Mann dissenting.

Initial Jobless Claims​

For the week ending November 2, seasonally adjusted initial unemployment claims rose to 221,000, up 3,000 from the prior week’s revised 218,000. The 4-week moving average fell by 9,750 to 227,250, compared to the revised 236,500 from the prior week, which was adjusted up by 500 to 237,000.

Fed Interest Rate Decision​

At its November 2024 meeting, the Federal Reserve cut the funds’ target range by 25bps to 4.5%-4.75%, following a 50bps cut in September, as expected. Policymakers reiterated their data-driven approach for future rate adjustments. Chair Jerome Powell stated that the Fed will decide on a meeting-by-meeting basis and may pause rate cuts in December, depending on incoming data. He noted that Trump’s election victory would not impact the Fed’s near-term policy and emphasized that the Fed does not speculate on future government actions.

Currencies​

The euro ended the week lower against the US dollar due to concerns over the Eurozone’s economic outlook following Trump’s election win and German political instability. The Japanese yen was flat against the dollar as BoJ minutes showed consensus for rate hikes, though strong wage data and global uncertainties cast doubt on this. The pound fell after the BoE’s expected 25bps rate cut, supported by 8 of 9 members, and expectations of a 0.5 percentage point inflation rise from the Labour Party’s budget. The Chinese yuan weakened amid concerns over Trump’s return, prompting a 10 trillion yuan stimulus package. The Australian dollar remained flat, with hawkish RBA signals and expected Chinese stimulus balancing the impact of Trump’s election.

Commodities​

Precious metals had a tough week, ending lower. Trump’s re-election drove expectations of inflationary policies, raising 10-year Treasury yields and the dollar index, which pressured non-yielding metals. Concerns over strained US-China relations and potential impacts on China’s economy, the largest importer of silver, also weighed on silver prices.

Equities​

The S&P 500 and Dow Jones rose nearly 5%, while the Nasdaq gained similarly, surpassing its July peak. The rally was fueled by the election conclusion easing political uncertainty and expectations of expansionary policies under a potential Trump administration, along with hopes for reduced geopolitical tensions. Nvidia led the rally with a 9% surge to a new high, followed by Google and Netflix, both up 5%. Apple, Microsoft, and Meta each rose about 3%.

 

[Z Forex]

Weekly Analysis by zForex Research Team - 18-22 November​

Dollar Rises on Inflation Expectations, Euro Hits Yearly Low ​

Global financial markets last week saw a strong rally in the U.S. dollar, weak performance in metals, and gains in Treasury yields. The dollar's surge, driven by inflationary expectations and geopolitical developments, weighed heavily on other currencies and commodities.

Key Points​

Currencies:

• DXY gained nearly 2%, marking seven straight weeks of growth, approaching the 107 level.
• The Euro hit its lowest level against the dollar in a year amid U.S. inflationary policy expectations.
• The pound declined to a 13-week low, pressured by weak growth data and dollar strength.
• The Japanese yen fell to a four-month low, with GDP growth for two consecutive quarters having a minimal market impact.

Commodities:

• Gold and silver experienced notable pullbacks, with silver showing relative resilience.
• The gold-to-silver ratio reached 83.80.
• Crude oil prices dropped approximately $2 for the week.

Fixed Income:

• U.S. 10-year and 2-year Treasury yields rose by 3% and 2%, respectively, driven by the "Trump trade" effect.

Macro Analysis​

Global economic data for October highlights a mix of improving inflation metrics and slower economic growth across key regions, with energy costs playing a significant role in driving headline inflation trends.

German CPI​

Inflation rose to 2.0% in October from 1.6% in September, its highest in three months, driven by higher services inflation (4.0% vs. 3.8%) and food prices (2.3% vs. 1.6%). Core inflation increased to 2.9%. Energy costs fell 5.5%, slowing from a 7.6% drop in September. EU-harmonized CPI accelerated to 2.4% YoY and rose 0.4% MoM.

U.S. PPI​

Producer prices rose 0.2% MoM in October and 2.4% YoY. Core PPI (excluding food, energy, and trade) rose 0.3% in October, up from 0.1% in September, and 3.5% YoY.

U.S. CPI​

Inflation climbed to 2.6% in October from 2.4% in September, its first increase in seven months. Energy costs fell 4.9%, slowing from a 6.8% drop, while shelter inflation remained at 4.9%. Core inflation held steady at 3.3%. Monthly CPI rose 0.2%.

UK GDP​

The economy grew 0.1% QoQ in Q3, down from 0.5% in Q2. Yearly growth improved to 1% from 0.7%. Services rose 0.1%, construction grew 0.8%, but production contracted by 0.2%. Net trade contributed positively, with exports down 0.2% and imports falling 1.5%

Eurozone GDP:​

GDP grew 0.4% QoQ in Q3, its best in two years, with Germany’s 0.2% growth avoiding recession. Spain rose 0.8%, France 0.4%, and Ireland rebounded by 2%. Yearly growth reached 0.9%.

U.S. Retail Sales​

Retail sales rose 0.4% MoM in October, following a 0.8% increase in September. Gains were led by electronics (+2.3%), autos (+1.9%), and food services (+0.7%). Declines were noted in miscellaneous stores (-1.6%) and furniture (-1.3%).

Currencies​

• Dollar Index (DXY): Climbed nearly 2%, testing 107, its seventh consecutive weekly gain, supported by Trump-related inflation expectations.
• Euro: Fell to a one-year low against the dollar amid broad USD strength.
• Pound: Declined to a 13-week low on weak GDP data and USD gains.
• Japanese Yen: Dropped to a four-month low despite consecutive GDP growth quarters.
• Chinese Yuan: Hit a three-month low, despite improving retail sales and unemployment.
• Canadian Dollar: Reached its lowest since 2020, pressured by falling oil prices and trade concerns, though strong PMI data provided slight relief.
• Australian Dollar: Declined on lower commodity prices and Chinese demand concerns, with RBA's steady rate comments offering little support.

Commodities​

• Gold and Silver: Gold posted its worst week since 2021, pressured by a stronger dollar and Trump-driven rate concerns. Silver outperformed gold, narrowing the gold-to-silver ratio.
• Crude Oil: Fell to $68.50 as the IEA forecasted an oil surplus for 2024, citing weaker demand and higher production. U.S. crude inventories rose by 2.1 million barrels.

Equities:​

• U.S. Stocks: Dow fell 0.8%, S&P 500 and Nasdaq dropped 1.5%. Broadcom (-6%) and Amgen (-8%) led declines, while Netflix (+7%) and Tesla (+7%) posted gains.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.18.2024​

Dollar Near Two-Year Highs, UK CPI in Focus ​

The US Dollar Index hovers near two-year highs at 106.6, pressuring EUR/USD at 1.0540 as hawkish Fed expectations weigh on the euro and pound.

The yen weakened to 155 after hints of gradual BoJ rate hikes, while crude oil and gold saw mixed performances amid shifting market dynamics. Gold rebounded to $2,600, supported by geopolitical tensions and Fed uncertainty. The GBP/USD at 1.2630 awaits UK CPI data, which may shape its trajectory. Silver recovered to $30.60, driven by China's economic outlook and US PMI expectations.

 

[Z Forex]

Gold Analysis by zForex Research Team - 11.18.2024​

Gold Finds Support, Fed Uncertainty Persists​

Gold prices surged to nearly $2,600 per ounce on Monday, recovering from their largest weekly decline since 2021, as the rally in the US dollar paused. Recent US data showed a strong rise in retail sales for October, highlighting the economy's resilience. Comments from several Federal Reserve officials last week added uncertainty over the timing and magnitude of potential rate cuts. However, markets are still pricing at roughly a 65% probability of a 25bps rate cut in December. Investors are now focused on upcoming remarks from other Fed officials this week, looking for clearer signals on the future path of US interest rates. Meanwhile, geopolitical tensions, particularly in the Middle East and the ongoing conflict between Ukraine and Russia, could fuel safe-haven demand, providing additional support for gold.

The first support level for gold is at $2,575, followed by $2,545 and $2,520 while $2,605 serves as a key resistance level, with $2,635 and $2,665 as the next levels to monitor if this resistance is surpassed.

 

[Z Forex]

GBP/USD Analysis by zForex Research Team - 11.18.2024​

UK Inflation Data Key for GBP/USD Direction​

The GBP/USD is trading around 1.2630 following last week's sharp decline. This week, UK CPI data will be released, and its outcome is expected to play a key role in determining the pair's direction. The market anticipates one more rate cut from the Bank of England in December. Meanwhile, expectations of a Trump election win are seen as supportive of the US Dollar Index due to his inflationary policies. This has contributed to the weakening of the pound. However, UK inflation data, along with upcoming economic reports from the US, will be crucial in shaping the market's outlook.

Key support levels for the GBP/USD pair are at 1.2595, 1.2520, and 1.2475. On the upside, resistance levels to watch are at 1.2680, 1.2740, and 1.2820.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.19.2024​

Market Awaits Upcoming EUR CPI Data ​

On Tuesday, precious metals and oil started the day with an increase due to geopolitical tensions.

In the dollar market, however, we see that after a significant rally, the pairs are beginning to rise again as profit-taking continues. In the Eurozone, we will see whether the rise in the EUR/USD pair continues with the release of the upcoming CPI data today.

 

[Z Forex]

USD/JPY Analysis by zForex Research Team - 11.19.2024​

Japanese Yen Gains on Speculation of Possible Intervention​

The Japanese yen strengthened to around 154 per dollar on Tuesday, recovering from four-month lows, as authorities issued warnings against excessive forex moves. Finance Minister Katsunobu Kato emphasized the government would monitor exchange rates and take action if needed. MUFG also suggested Japan could accelerate interest rate hikes due to persistent inflation. However, BOJ Governor Kazuo Ueda said any rate increases would be gradual, without giving a specific timeline. The yen has dropped over 10% since September, impacted by uncertainty over BOJ policy and a stronger dollar driven by expectations of fewer Fed rate cuts.

In the USD/JPY pair, the first support level is at 153.80. If this level is broken, the next support levels to monitor are 152.50 and 151.80. On the upside, resistance levels are at 156.10, 157.50, and 158.00, respectively.

 

[Z Forex]

Gold Analysis by zForex Research Team - 11.19.2024​

Gold Rises on Weaker US Dollar​

Gold surged above $2,620 per ounce on Tuesday, reaching its highest point in a week, primarily due to a weakening US dollar. Market focus has now shifted to remarks from Federal Reserve officials, as investors seek more insight into the central bank’s stance on monetary easing. Expectations for a rate cut of 0.25% at the Fed’s December meeting have fallen to just below 59%, a decrease from 62% the previous day and over 65% a week earlier, according to CME FedWatch. Investors are also closely tracking President-elect Donald Trump’s cabinet picks. Additionally, growing geopolitical uncertainties are driving increased demand for safe-haven assets like gold, as tensions continue to rise in the Middle East and between Russia and Ukraine.

The first support level for gold is at $2,575, followed by $2,545 and $2,525 while $2,635 serves as a key resistance level, with $2,691 and $2,711 as the next levels to monitor if this resistance is surpassed.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.20.2024​

Russia-Ukraine Developments Test Market Strength ​

Metals continued their upward movement on Wednesday with increasing tensions between Russia and Ukraine.

The dollar, which rallied following Trump's victory, declined due to profit-taking but has since rebounded from the 106 level and is rising again. On the UK side, today’s upcoming CPI data will be crucial in determining the direction of GBP/USD. Meanwhile, in the US, data remains subdued as the week progresses.

 

[Z Forex]

EUR/USD Analysis by zForex Research Team - 11.20.2024​

EUR/USD Attempts Breaking Above 1.06$​

The EUR/USD pair has struggled to gain momentum, trading below the $1.06 mark and at risk of further declines. The strength of the US dollar has been the dominant factor in foreign exchange markets in recent weeks, outweighing geopolitical concerns. This has put downward pressure on all major currency pairs, driven by rising inflation fears following Trump's victory and the Federal Reserve's indication that it will slow its rate cuts.

Euro faces challenges from political instability in Europe, weakening economic data from the Eurozone, and potential escalations in the Russia-Ukraine conflict. While US data is light this week, global PMIs on Friday could increase volatility.

The dollar index maintained its recent drop, settling around 106.2 on Wednesday, as the initial surge in demand for safe-haven currencies, triggered by the intensifying Russia-Ukraine conflict, began to fade.

EUR/USD resistance levels are 1.0600, 1.0650, and 1.0700, with support at 1.0550, 1.0500, and 1.0450.

 

[Z Forex]

GBP/USD Analysis by zForex Research Team - 11.20.2024​

UK Inflation Data Key for GBP/USD Direction​

GBP/USD fluctuated just below the 1.2700 mark, as traders of the pair braced for a significant release of UK economic data, highlighted by the Consumer Price Index (CPI) inflation figures for October. With US economic data taking a backseat on the same day, attention in the pair shifted to the UK reports, which could influence the Bank of England's (BoE) stance on potential rate cuts for the remainder of the year. In its Monetary Policy Report released on Tuesday, the BoE adopted a cautious tone, stating that interest rates remain "moderately restrictive." As a result, market participants are now pricing in less than a 20% probability of an additional rate cut by the BoE this year.

Key support levels for the GBP/USD pair are at 1.2595, 1.2520, and 1.2475. On the upside, resistance levels to watch are at 1.2700, 1.2740, and 1.2820.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.21.2024​

Markets Rattle Amid Geopolitical Strains and Rate Speculation ​

Global markets are navigating a volatile landscape as escalating geopolitical tensions, including new developments in the Russia-Ukraine war, and heightened risks in the Middle East drive safe-haven demand for gold while weighing on risk-sensitive currencies.

The Euro and Pound remain under pressure amid policy uncertainty, while the Yen struggles with domestic economic concerns and dollar strength. Meanwhile, industrial metals like silver face headwinds from weaker demand prospects, and investors await key central bank rate decisions for further direction.

 

[Z Forex]

EUR/USD Analysis by zForex Research Team - 11.21.2024​

Geopolitical Strains and Wage Pressures Weigh on the Euro​

The Euro/Dollar is trading around 1.0545 on Thursday after yesterday’s sell of, pressured by a general dollar strength, mounting tensions between Russia and Ukraine, and growing concerns about downside risks to the Eurozone economy. Reports emerged that Ukraine had fired UK cruise missiles into Russia for the first time. Meanwhile, in its annual Financial Stability Review, the ECB highlighted that heightened geopolitical tensions and policy uncertainties are amplifying sovereign vulnerabilities, while rising global trade tensions are increasing the likelihood of adverse economic shocks. On the other hand, negotiated wages in the Euro Area rose 5.4% YoY in Q3, the most since the euro was introduced, complicating the ECB’s plans for interest rate cuts. The central bank is still expected to deliver its fourth 25 bps rate cut in December.

In the EUR/USD, the first resistance level is 1.0600 followed by 1.0650 and 1.0700 respectively. On the downside the first support level is 1.0550 and next support levels to watch are 1.0500 and 1.0450 consecutively.

 

[Z Forex]

Gold Analysis by zForex Research Team - 11.21.2024​

Gold Climbs Above $2,650 as Geopolitical Tensions Escalate​

Gold extended its recent gains to above $2,650 per ounce on Thursday, rising for the fourth consecutive session, as investors sought safety in the metal as geopolitical uncertainty intensified with escalating Russia-Ukraine tensions. On Wednesday, Ukraine launched Western-supplied long-range weapons for the second time, a day after President Putin approved an updated nuclear doctrine expanding the conditions for using nuclear weapons. At the same time, the US vetoed a UN resolution for a Gaza ceasefire, reigniting concerns over the ongoing Middle East conflict. On the monetary policy front, markets continued to assess the Federal Reserve’s interest rate outlook, closely watching Fedspeak for new trading signals. A slight majority of the market still expects a 25bps rate cut in December, which would reduce the opportunity cost of holding non-interest-bearing gold.

In the XAU/USD, the first resistance level is 2665 followed by 2692 and 2712 respectively. On the downside the first support level is 2630 and next support levels to watch are 2590 and 2550 consecutively.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.22.2024​

Gold Shines, Dollar Surges with Global Tensions ​

Markets react to geopolitical tensions, inflation data, and monetary policy shifts.

Friday saw the dollar hold strong above 107 on rate hike expectations, while gold hit $2,680, marking its fifth straight gain. Silver rebounded to $31, supported by geopolitical tensions and steady Chinese policy. In forex, GBP/USD slid on rising UK inflation, and USD/JPY traded near 154.85 after weak Japanese manufacturing data.

 

[Z Forex]

GBP/USD Analysis by zForex Research Team - 11.22.2024​

GBP/USD Slides as UK Inflation Rises​

The British pound is trading around 1.2570 as of this morning, nearing the six-month low it reached last week amid escalating tensions between Russia and Ukraine. Reports indicate that Ukraine has launched UK-supplied cruise missiles into Russia for the first time. Earlier in the week, the pound briefly touched $1.271 after a stronger-than-expected inflation reading, which reaffirmed the Bank of England's cautious stance on future interest rate cuts.

In October, the UK’s annual inflation rate rose to 2.3%, the highest in six months, up from 1.7% in September. This exceeded both the Bank of England’s target and the market’s forecast of 2.2%. Inflation in services, a key indicator of domestic price pressures closely monitored by the central bank, edged up slightly to 5% from 4.9%. As a result, markets are now pricing in only a 14% chance of a rate cut this year, with expectations for just two cuts in 2025.

The first resistance level for the pair is at 1.2620, followed by 1.2680 and 1.2720, respectively. On the downside, the first support level is at 1.2550, with subsequent levels to watch at 1.2520 and 1.2475.

 

[Z Forex]

Silver Analysis by zForex Research Team - 11.22.2024​

Silver Prices Rebound with China Demand​

Silver prices are trading around $31 per ounce on Friday morning, rebounding from losses in the previous session. On Wednesday, Ukraine launched a series of UK-made missiles into Russia, following an earlier strike using US-made missiles. Meanwhile, geopolitical tensions intensified as the US blocked a UN Security Council resolution calling for a ceasefire in Gaza.

Regarding monetary policy, Federal Reserve governors Michelle Bowman and Lisa Cook offered differing views on inflation and the future trajectory of interest rates in separate statements on Wednesday. In China, the People's Bank of China (PBOC) kept key lending rates steady this week, aligning with expectations and providing no new signals likely to affect demand in the world's largest metals consumer.

For XAG/USD, the first resistance level is at 31.60, followed by 32.50 and 32.80, respectively. On the downside, the first support level is at 30.80, with additional levels to watch at 30.20 and 29.80.

 

[Z Forex]

Daily Analysis by zForex Research Team - 11.25.2024​

Markets Eye Fed Uncertainty Before US Data​

The dollar starts the week weakening against all major currencies.

Global markets are shaped by concerns over escalating tensions between Russia and Ukraine and uncertainties surrounding the US Federal Reserve's (Fed) monetary policy. Meanwhile, attention is turning to the US growth data set to be released next week.

Adding to the ongoing political tensions, potential conflicts between newly elected US President Donald Trump and the Fed's leadership are contributing to market volatility. Signals from the minutes of the Federal Open Market Committee (FOMC) meeting held on November 6-7, scheduled for release on Tuesday, are expected to provide insights into the Fed's future projections.

 

[Z Forex]

EUR/USD Analysis by zForex Research Team - 11.25.2024​

EUR/USD Tests 1.0500 as Dollar Retreats​

The EUR/USD pair started the week on a positive note, testing the 1.0500 resistance level. The dollar index fell 0.6% on Monday, dipping below 107 and retreating from its recent two-year highs after President-elect Donald Trump selected hedge fund manager Scott Bessent as Treasury Secretary. This announcement reassured investors, as Bessent is expected to focus on economic and market stability despite his support for Trump’s tariff and tax cut plans.

The dollar weakened against all major currencies, with the euro, British pound, Australian dollar, and Japanese yen posting significant gains. Market attention now shifts to the release of the latest FOMC meeting minutes, PCE inflation data, and other key economic indicators, which could shape expectations for future Fed rate decisions. Last week, the dollar surged to a two-year high amid speculation that Trump’s policies could drive inflation, potentially limiting the Fed's ability to lower interest rates.

Support levels for EUR/USD are at 1.0450, with further levels at 1.0400 and 1.0360. On the upside, resistance is at 1.0520, followed by 1.0610 and 1.0640.