Focus turns to Fed after ECB easing

Joshua Mahony MSTA Scope Markets

Yesterday's ECB meeting represented the penultimate event of the year, with markets now turning their attention to next week's FOMC meeting.

FTSE gaining ground after ECB
Early December refuses to follow the usual pattern
OPEC meeting set to dominate crude considerations

The FTSE is seeking to close out the week in a positive fashion, following what has been an incredible week for equity bulls. Yesterday's ECB meeting marked the penultimate risk event of the year, with the focus now turning to Janet Yellen's appearance next week. We have waited a year for another US rate hike and with the sharp market correction coming as a result of the last one, there will be some hesitancy coming into the announcement. Markets across Europe are clinging stubbornly on to the gains made throughout the week. The first two weeks of December are meant to see small declines before the festive bounce kicks in. We are still waiting for a real selloff, but time is running out.

This weekend sees OPEC and non-OPEC members meet with a view to agreeing the second half of the output cut discussed in Vienna. With Russia seemingly on-board, this may seem like a foregone conclusion. However, even if we did get an agreement across the line, it is quite another thing getting each country to actually conform to their given quota. Ahead of the open we expect the Dow Jones to open 10 points higher, at 19,525.

Author

Joshua Mahony MSTA

Scope Markets

Joshua Mahony is Chief Markets Analyst at Scope Markets. Joshua has a particular focus on macro-economics and technical analysis, built up over his 11 years of experience as a market analyst across three brokers.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.