Key Currencies and Technical Analysis (4-Hour Chart) – December 10, 2024
Market Overview
EUR/USD – Sell
EUR/USD is trading near 1.0555, with the market adopting a cautious stance ahead of tomorrow’s US CPI release (December 13, 15:30 GMT+2).
US CPI Forecasts:
- Annual CPI: +2.7% (previous: +2.6%).
- Monthly CPI: +0.2% (unchanged).
- Core CPI (ex-food and energy): +3.3% YoY, +0.3% MoM.
Following this, Thursday’s PPI data is expected to show +2.6% YoY and +0.3% MoM. Market pricing indicates an 80% probability of a rate cut by the Federal Reserve during its December 17–18 meeting.
German Inflation Data:
- Monthly CPI: -0.2% (previous: +0.4%).
- Annual CPI: +2.2% (as expected).
Outlook:
The ECB is widely expected to cut rates by 25 basis points at its meeting, adding downward pressure on the euro.
GBP/USD – Buy
GBP/USD is hovering around 1.2745, reflecting the lingering impact of last week’s US employment data.
US Employment Data (November):
- Non-Farm Payrolls (NFP): +227,000 (forecast: +200,000).
- Average Hourly Earnings: +0.4% MoM, +4.0% YoY (both exceeded forecasts).
- Unemployment Rate: 4.2% (previous: 4.1%).
Outlook:
With over an 80% chance of a Fed rate cut priced in, this week’s key focus for the pound is Friday’s UK GDP data (October), forecasted at +0.2% MoM (previous: -0.1%), alongside expectations for increased industrial production.
AUD/USD – Strong Sell
AUD/USD is trending downward near 0.6380.
RBA Policy Announcement:
- The central bank left rates unchanged at 4.35% but expressed concerns about inflation risks.
Economic Data:
- NAB Business Confidence Index (November): -3.0 (previous: +5.0).
- Business Conditions Index: +2.0 (previous: +7.0).
Outlook:
Focus shifts to Thursday’s Australian employment report, which is forecast to show an increase of +25,000 jobs and a slight uptick in unemployment to 4.2%.
USD/JPY – Buy
USD/JPY is trading around 151.10 with no clear direction.
Japanese Economic Indicators:
- GDP (Q3): +1.2% annualized (previous: +0.9%), +0.3% QoQ (previous: +0.2%).
- Bank Lending Growth: +3.0% (previous: +2.6%).
- Economy Watchers Current Index: 49.4 (forecast: 47.3).
Outlook:
USD/JPY’s movement will hinge on the outcome of US inflation data.
XAU/USD – Strong Buy
XAU/USD is climbing near 2670.00, supported by global rate cut expectations and strong demand for safe-haven assets.
Support Factors:
- Increasing global rate cut expectations.
- November’s US labor market data boosted the Fed’s rate cut probability to 90%.
- ECB, Bank of Canada, and Swiss National Bank are expected to cut rates this week.
Outlook:
Tomorrow’s US CPI and Thursday’s PPI data will be crucial in determining gold price direction.
Weekly Focus
This week’s key drivers are central bank policy decisions and inflation data. EUR/USD and AUD/USD remain pressured by dovish central banks, while GBP/USD shows resilience ahead of UK data. USD/JPY awaits US CPI, and gold benefits from heightened expectations for monetary easing.
Stay flexible and focus on key data releases to capitalize on market movements!
