Key Currencies and Technical Analysis (4-Hour Chart) – December 5, 2024
EUR/USD – Strong Buy
EUR/USD is attempting a corrective move after a sharp drop earlier this week, currently testing the 1.0525 level. Market participants are focusing on today’s Eurozone retail sales data, though forecasts suggest it may not significantly support the euro.
- Eurozone Retail Sales (October): Expected at -0.3% MoM, +1.7% YoY (previous: +2.9%).
- German Factory Orders: Declined by 1.5% MoM (previous: +7.2%, revised).
- ECB President Lagarde hinted at monetary easing in the December 12 meeting, citing regional economic weakness and a decline in services activity. She also expressed concerns about potential tariff hikes proposed by President-elect Trump.
- Eurozone November Services PMI: 49.5 points (as expected).
- German Services PMI: Slightly lower at 49.3 points.
- US ISM Non-Manufacturing PMI: Fell sharply to 52.1 points (forecast: 55.5).
GBP/USD – Strong Buy
GBP/USD is showing a sideways movement near 1.2700 as the market remains subdued ahead of Friday’s US employment data.
- Non-Farm Payrolls (NFP): November forecasted at +200,000, a significant improvement from October’s +12,000.
- US Average Hourly Earnings: Expected at +0.3% MoM (previous: +0.4%), +3.9% YoY (previous: +4.0%).
- US Unemployment Rate: Expected to rise from 4.1% to 4.2%.
- In the UK, the November Services PMI rose to 50.8, while the Composite PMI increased to 50.5, signaling economic expansion.
- BoE Governor Bailey hinted at up to four rate cuts by 2025.
AUD/USD – Strong Sell
AUD/USD is showing a slight upward movement, testing the 0.6430 level, but remains under pressure from weaker-than-expected Australian GDP data.
- Australian GDP (Q3): Growth slowed to +0.8% YoY (forecast: +1.1%, previous: +1.0%).
- Trade Balance (October): Surplus widened to AUD 5.95 billion (forecast: AUD 4.5 billion).
- US data includes ADP Employment at +146,000 (forecast: +150,000) and ISM Non-Manufacturing PMI declining to 52.1, temporarily weakening the USD.
USD/JPY – Sell
USD/JPY has retreated slightly from its November 29 high, trading near 149.87.
- ADP Employment: Increased by 146,000 in November (forecast: +150,000).
- ISM Non-Manufacturing PMI: Fell to 52.1 points (forecast: 55.5).
- Continued speculation about a BOJ rate hike is supporting the yen.
- Japan’s Labor Wage Statistics (October), expected on Friday, forecast a slowdown to +2.6% YoY.
XAU/USD – Strong Buy
XAU/USD is testing the 2655.00 level with slight upward movement as gold traders adopt a cautious stance ahead of the US employment data release.
- Non-Farm Payrolls (NFP): Forecasted at +200,000 (previous: +12,000).
- US Average Hourly Earnings: Expected at +0.3% MoM, +3.9% YoY.
- US Unemployment Rate: Expected to rise to 4.2%.
- Global expectations for monetary easing are supporting gold prices, with potential December rate cuts by the Fed, ECB, and BoE already priced in.
- Geopolitical risks in Syria continue to bolster demand for gold as a safe-haven asset.
Summary
Markets remain cautiously optimistic amid a mix of strong and weak economic data, geopolitical risks, and evolving monetary policy expectations. EUR/USD and GBP/USD show buying potential, while AUD/USD and USD/JPY are under selling pressure. Gold remains a key focus, supported by easing expectations and geopolitical concerns.
