Daily Analysis by zForex Research Team - 12.23.2024
Markets Navigate Policy Shifts, Soft Economic Data, and Rising Tensions
The euro dipped to its lowest level in nearly a year amid political challenges in major Eurozone economies and softer data, even as the ECB signaled cautious policy.
The yen fell on wavering expectations for a BOJ rate hike, while gold stabilized after a modest U.S. inflation print tempered the dollar’s rally. The British pound traded narrowly on lingering dovish BoE signals, and silver hit three-month lows, pressured by a hawkish Fed outlook and weaker Chinese demand. Investors now watch key data and central bank policy moves to gauge market direction.
Gold Analysis by zForex Research Team - 12.23.2024
Gold Holds as Weak Dollar Offsets India’s Declining Demand
Gold held around $2,620 per ounce on Monday, supported by a weaker US dollar after modest PCE inflation data renewed expectations for Fed easing next year. Earlier, the Fed’s cautious rate cut signals briefly pushed gold to a one-month low. Short-term pressures remain from declining physical demand in India, where officials forecast a significant drop in December imports. Despite challenges, gold is up over 27% this year, its best annual performance since 2010, driven by US policy easing, safe-haven demand, and central bank purchases.
Technically, the first resistance level will be 2635 level. In case of this level’s breach, next levels to watch would be 2670and 2710 consequently. On the downside 2605 will be the first support level. 2575 and 2545 are next levels to monitor if the first support level is breached.
GBP/USD Analysis by zForex Research Team - 12.23.2024
GBP/USD Trades Narrowly as BoE Dovishness and Fed Policy Weigh
The GBP/USD pair traded within a narrow range above the mid-1.2500s during the Asian session, showing little momentum after Friday's rebound from a 1.2475 low, the weakest since May. The Fed's 25bps rate cut last week, paired with signals of slower rate cuts in 2025, kept US Treasury yields high and supported USD dip-buying, limiting GBP/USD gains. Geopolitical risks and the Bank of England’s dovish stance, including rate hold decisions and a downgraded Q4 economic outlook, added further pressure on the British Pound. Traders await the BoE's Quarterly Bulletin and US Consumer Confidence Index for further direction.
The first resistance level for the pair will be 1.2600. In case of this level's breach, the next levels to watch would be 1.2680 and 1.2750. On the downside 1.2475 will be the first support level. 1.2400 and 1.2350 are the next levels to monitor if the first support level is breached.
