US Brief: top Trade Setups in Forex - Brace for the US Final GDP Figures!
|On Friday during the New York session, the U.S. Commerce Department will post final readings of third-quarter GDP (+2.1% annualized on quarter expected), November personal spending (+0.4% on month anticipated) and personal income (+0.3% on month expected). The University of Michigan will report its final readings of the December Consumer Sentiment Index (99.2 expected).
The U.S. stock indexes charged higher to record closes, as the Dow Jones Industrial Average jumped 137 points (+0.5%) to 28376, the S&P 500 added 14 points (+0.5%) to 3205, and the Nasdaq Composite was up 59 points (+0.7) to 8887. Spot gold climbed 0.2% to $1,478 an ounce.
XAU/USD - Sideways Sessions Continues
The safe-haven-metal prices slightly dropped after hitting the two-week high on Thursday. Gold prices slid 0.13% to $1,482.55 per ounce after reaching a $1,484.95 high. Earlier today, the precious metal gold prices also dropped 0.03% to $1,478.67.
The level of political uncertainties soared in the wake of the U.S. House of Representatives, which voted to impeach President Donald Trump. Eventually, the event supported gold prices earlier in the week as investors rushed for the safe-haven metal gold.
Gold charts seem to show that the yellow metal is in a consolidation pattern, and it is just a matter of time before gold moves higher again. It should be noted that this year, gold prices were up by around 15%, mainly due to the Sino-U.S. trade war and the worries of its impact on the global economy.
Gold may have a tough time next year because the Federal Reserve has paused rate cuts, and with elections in November, there are many chances that trade deal will be completed soon, which eventually de-escalates trade tension.
XAU/USD - Daily Technical Levels
|
Support |
Pivot Point |
Resistance |
|
1474.26 |
1478.02 |
1482.72 |
|
1469.56 |
1486.47 |
|
|
1461.11 |
1494.93 |
Gold - XAU/USD - Daily Trade Sentiment
On Friday, the sideways trading in gold lasts for another day, but lately, gold is meeting support near 1,477, which appears to give a hard time to gold sellers.
On the hourly timeframe, the precious metal gold has created a bullish engulfing candle over 1,477, which is anticipated to encourage some bullish movement in gold, maybe up to 1,481. While the bearish violation of 1,477 can direct selling till 1,474.
USD/CAD - Bearish Channel Dominates
The USD/CAD closed at 1.31247 after placing a high of 1.31379 and a low of 1.31075. Overall the movement of USD/CAD remained bullish throughout the day. At 18:30 GMT, the Wholesale Sales for October from Canada showed a decline to -1.1% from expectations of -0.4% and weighed on the Canadian Dollar. At 18:33 GMT, the ADP Non-Farm Employment Change for November came in as 30.9K.
On the other hand, crude oil prices continued to push higher towards $61.40 per barrel of West Texas Intermediate. However, the rise in crude oil prices failed to give strength to commodity-linked Loonie as the decline in Wholesale Sales to -1.1% weighed on the Canadian Dollar on Thursday.
On the news front, Trump Impeachment was voted by U.S. House of Representatives on Thursday, and Democrats voted to impeach Donald Trump and set free of his duties due to which U.S. dollar remained under stress. Nevertheless, as the Republicans are yet to vote in the U.S. Senate, which is expected to come in favor of Trump, USD/CAD failed to respond to this news.
The pair continued to move under the pressure of the Canadian Dollar, which pushed the USD/CAD prices towards 1.31379 level. The Wednesday losses were recovered to some extent on Thursday.
The improvement in the risk sentiment supported the strength in the Canadian Dollar. The phase-one trade deal agreement between China & the U.S. is expected to increase the global growth rate. As Canada is a major producer of commodities, its economy would benefit more from an improved outlook of global trade.
The Canadian Government bond yields of 10-year fell 12 Canadian cents to 1.075% and weighed on the Canadian Dollar, which supported USD/CAD in an upward direction.
USD/CAD - Daily Technical Levels
|
Support |
Pivot Point |
Resistance |
|
1.3112 |
1.3125 |
1.3139 |
|
1.3099 |
1.3152 |
|
|
1.3072 |
1.3179 |
USD/CAD - Daily Trade Sentiment
On Friday, the USD/CAD seems to show a bit recover after a bullish close of the daily candle on Thursday. The USD/CAD is trading slightly optimistic around 1.3135, but it is soon likely to face resistance around 1.3160. On the downside, the USD/CAD can find support around 1.3105 and 1.3085. Let's keep an eye on 1.3155 as this level can keep the USD/CAD bearish.
AUD/USD – Ascending Triangle Pattern In Play
The AUD/USD pair closed at 0.68848 after placing a high of 0.68880 and a low of 0.68484. Overall the movement of AUD/USD remained bullish throughout the day. At 5:30 GMT, the Employment Change in November was increased to 39.9K against the expectations of 14.5K and supported the Australian Dollar on Thursday. At 5:30 GMT, the Unemployment Rate from the Australian Bureau of Statistics was published, which also endorsed Aussie when it showed a decline in November to 5.2% from the expected 5.3%.
The sharp rebound in the Employment change of Australia and the less unemployment rate showed that the labor market might have enough potential that further need for an interest rate cut is not needed.
The decreasing chance for no rate cuts in its next policy meeting by Reserve Bank of Australia gave strength to the Australian Dollar on Thursday, and hence, AUD/USD pair jumped to 0.68880 level.
RBA has cut its interest rates three times this year to a record low of 0.75% in an attempt to decrease unemployment and revive wage growth. RBA has argued for an extended period that its unemployment rate should be down to at least 4.5% to lift the wage growth.
Earlier this week, RBA's December meeting minutes suggested that any deterioration in the outlook of the labor market will lead towards the next rate cut. Moreover, now labor market data has improved investors are reacting in expectations of a no-rate cut in the next RBA meeting.
On the other hand, weaker than expected, U.S. Jobless Claims for the previous week weighed on the U.S. dollar and added in the upward trend of AUD/USD on Thursday. U.S. jobless claims increased to 234K from the expectations of 225K and weighed on the U.S. dollar.
AUD/USD - Technical Levels
|
Support |
Pivot Point |
Resistance |
|
0.6867 |
0.6878 |
0.6894 |
|
0.6851 |
0.6905 |
|
|
0.6823 |
0.6932 |
AUD/USD - Daily Trade Sentiment
Robustness in the Aussie has pushed the AUD/USD pair higher to the horizontal resistance level of 0.6895. The AUD/USD has formed neutral candles below this resistance level, which are increasing caution about the bullish trend.
The traders await the U.S. Final GDP data to determine its next movement. The AUD/USD can find next resistance near 0.6930, while the support stays around 0.6870. The MACD and RSI are staying in the bullish zone, demonstrating the chances of a bullish trend in the AUD/USD pair.
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