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US Data on Wednesday came in mixed, including Durable Goods Orders that fell 5.4% in October, exceeding the expected 3.1% decline. On the positive side, the University of Michigan Consumer Sentiment Index stood at 61.3 in November, revised up from the preliminary reading of 60.3.
Initial Jobless Claims that retreated more than expected. Initial Claims declined to 209,000 from 233,000, and Continuing Claims pulled back after seeing increases for eight consecutive weeks, declining to 1.84 million.
Following the economic reports, the US dollar strengthened and lost momentum due to rising equity prices, prolonging its correction. The US Dollar Index (DXY) increased by 0.30%; it closed at roughly 103.90 after peaking at 104.20. Thanksgiving Day is on Thursday, so the US market will be closed. On Friday, there will be a shortened trading session.
In the short term, the EUR/USD pair is still moving with a bearish bias, with a trendline at 1.0900 and the next significant support at 1.0830. The European Central Bank (ECB) will make available the minutes of its most recent meeting on Thursday, along with the preliminary November Eurozone PMIs. The financial statistics will be watched carefully.
After the US Dollar’s momentum waned, the GBP/USD pair bottomed out close to 1.2450 and then rose back towards 1.2500. The UK government’s Autumn Statement, which included a 2 percentage point reduction in national insurance, was met with a muted response in the pound.
The 10-year Treasury yield increased from monthly lows to 4.42%, which caused the USD/JPY to spike higher. The two increased to 149.75, up 260 pip from the lows on Tuesday.
After getting close to the 200-day Simple Moving Average (SMA), NZD/USD declined more, but it ultimately stabilised above 0.6000. Overall, the bias is still upward.
The USD/CAD pair is still moving sideways, but as price encountered resistance at the 20-day SMA and dropped below 1.3700, the risk began to shift to the downside. Additional losses would be possible if there was a break below 1.3660.
Although it lost ground as well, the AUD/USD pair found support in the relevant technical zone of 0.6520. The 200-day SMA, which is located just below 0.6600, continues to limit the upside. On Friday, the Judo Bank PMI is expected.
Gold fell to $1,986 after failing to stay above $2,000. The overall trend is upward, but further gains won’t come until prices break $2,010.
Crude oil prices dropped just 1% in a volatile session influenced by the OPEC+ postponing its meeting. WTI bottomed at $73.80 and then rebounded back to $76.85.
What to watch next session
The preliminary November PMIs are due on Thursday, starting with Australia and then moving to Europe. US markets will be closed due to Thanksgiving Day. The European Central Bank will release the minutes of its latest meeting.
Also Read
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Nagel: ECB approaching interest rates peak
Negative sentiment drags CAD to fresh weekly lows
