Revived Stimulus Talks Gives Wall Street A Late Boost | - International

  • Late in the US session indices recovered lost ground on reports that stimulus talks in the US were set to resume.
  • The US dollar was broadly weaker and EUR/USD was the largest gainer amongst FX majors. The US dollar index remains anchored to key support around 92.13, with a break below signalling another bout of broad dollar weakness.
  • In yesterday’s report, Australia’s employment growth surprised to the upside with the creation of 178.8k jobs (-30k expected), taking overall employment to just 1.7% below pre-COVID levels. Whilst unemployment rose to 7% it was less than the 7.2% expected. Despite the relatively upbeat report, AUD/USD traded lower in line with global equities.


Today’s Calendar Events (Times are GMT+11 Sydney)

  • No major economic data is released today.
  • UK retail sales are expected to soften as lockdowns continue to weigh on the economy ahead of Christmas. GBP pairs and the FTSE 100 (UK100) are in focus for news traders.
  • And it’s a similar story for Canada’s retail sales as some provinces enter lockdown. CAD pairs and the TSX 60 (CANADA60) index are of interest to news traders.


NZD/JPY: Coiling Up – Volatility Pending?

  • Prices have clearly found support around 71.50 where the weekly pivot resides and prices are coiling up within a triangle formation. (Please note that the weekly pivots will be recalculated on Monday).
  • Given the news of stimulus talks in the US, the bullish momentum leading into the triangle and that support clearly resides at 71.50, the bias is for an upside break of the descending trendline.
  • However, if prices break below 71.50 then the bias reverts to near-term bearish.


USD/NOK: Bears Probe Key Support

  • With the dollar index resting on key support we suspect a large USD move is around the corner. The bias is bearish due to the daily structure, yet when so many FX pairs reside around a key level we should be on guard for a move in either direction.
  • USD/NOK is below 9.000 but bears must break 8.9645 support to bring the September lows into focus.
  • The bias remains bearish below 9.1913 although the candle highs around 9.0950 can also be used to fine-tune risk management, if prices do break lower today or early next week.


Copper (XCUUSD): Double Bottom Suggests Support Has Been Found

  • A bullish engulfing candle on H4 (four-hour chart) respected the 50% retracement level and shows a double bottom formation around 316.
  • A bullish engulfing candle has also appeared on D1 (daily chart).
  • A break above today’s high (312.43) or the descending correction line suggest bullish continuation and brings 330 into focus.


Watchlist Update:

AUD/JPY: Removed from watchlist. Failed to break below the monthly pivot with any conviction. Trapped Between the Monthly and Weekly Pivots (for now)

GBP/JPY: Removed from watchlist. Its breakout failed to hold beneath 137.52 support and the daily chart has produced a bullish pinbar.

Nasdaq 100 (USTEC): On the back burner. Prices stopped just short of our initial 11,785 target before reversing higher, but we can reconsider shorts if a lower high forms beneath the 12,100 high.

Bitcoin (BTCUSD): Bias remains bullish above the 17k support zone or the lower trendline of the bullish channel. 20k remains the key focus with 19k the next level of resistance.

NZD/CHF: Bias remains bullish above 0.6230 support. Waiting for a clear above 0.6330 resistance to suggest bullish continuation.

USD/SEK: We continue to wait for a break beneath 8.5527 support to signal a major breakout.

USD/CNH: The bias remains bearish below 6.6560. The next major support is around 6.4650.

Hang Seng (HK50): On the backburner. Bullish momentum has waned since breaking out of its bullish wedge. Although overall the bias remains bullish above 25,9000.

Gold (XAU/USD):  A break beneath 1850 support brings the 1800 lows into focus.

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