US Brief: top Trade Setups in Forex - Brace for the ECB and UK Parliamentary Elections!


On Thursday, the U.S. dollar is trading with bearish bias after Dovish FOMC. The Consumer Price Index (CPI) for November was released from the United States and showed growth of 0.3% from the expected 0.2% and supported the U.S. dollar on Wednesday.

However, the Core Consumer Price Index (CPI) from the U.S. remained flat with the expectations and previous month's 0.2%. Federal Reserve held its interest rates steady and said that it would maintain its standards where they were through 2020. Today, the focus is likely to stay on the ECB and U.K. Elections.

 

XAU/USD - Dovish FOMC Drives Gold Higher

The safe-haven-metal prices rose mainly due to Federal Reserve as they kept the interest rates unchanged as expected. Gold prices continued to gain support amid the Trump administration's uncertainty regarding new tariffs for China. 

The Federal Reserve kept U.S. rates unchanged at 1.5% to 1.75% in its December policy decision, bringing an end to 3 back-to-back cuts between July and October, as it noted strong economic and labor-market growth.

The gold would have benefited more from another Fed cut that would have technically weakened the greenback and boosted the yellow metal as an alternative.

However, gold traders were looking beyond rates on Wednesday, as the attention across markets fastened to the U.S.-China trade dispute. Investors are curious to see how Trump administration would proceed come Sunday, the deadline for the imposition of tariffs on another $156 billion worth of Chinese goods.

In the event, the tariffs are not canceled by Friday; then we will likely see a surge in risk-off ahead of the weekend that might benefit gold.

XAUUSD

 

XAU/USD - Daily Technical Levels

Support

Pivot Point

Resistance

1465.37

1472.2

1481.64

1455.92

1488.48

1439.64

1504.76

 

Gold – XAU/USD - Daily Trade Sentiment

Gold sailed to trade near 1,475, having produced three white soldiers candles on the 4-hour graph. On the higher side, gold may get a next resistance nearby 1,479/82. It seems like the right level to open a bearish position.

On the flip side, gold is expected to gain support near 1,471 and 1,466. The MACD and RSI are also suggesting a bullish bias, so we better look for stay bullish above 1,467.

 

USD/CAD - Triple Bottom Pattern In Play

The USD/CAD closed at 1.31720 after placing a high of 1.32397 and a low of 1.31620. Overall the trend for the USD/CAD pair remained strongly bearish that day.

At 18:30 GMT, the Capacity Utilization Rate from Canada showed a decline to 81.7% from expected 82.0% and weighed on the Canadian dollar.

On the other hand, at 18:30 GMT, the Consumer Price Index (CPI) for November was released from the United States and showed growth to 0.3% from the expected 0.2% supported the U.S. dollar on Wednesday. However, the Core Consumer Price Index (CPI) from the U.S. remained flat with the expectations and previous month's 0.2%. Federal Reserve held its interest rates steady and said that it would maintain its standards where they were through 2020. 

The U.S. crude oil Inventories were released at 20:30 GMT and showed growth to 0.8M against the expectations of -2.9M. The increase in U.S. Crude Oil Inventories weighed on WTI Crude Oil prices.

Weakened demand for WTI Crude Oil also affected the Canadian dollar and made it weak against the U.S. dollar, which was already dropping itself.

The U.S. dollar remained weak throughout the day amid the Fed Chair's dovish statement and increased US-China trade deal uncertainty.

Despite good macroeconomic data from the United States, the U.S. dollar failed to gain traction on Wednesday and dragged the USD/CAD to the level of 1.316.

USDCAD

 

USD/CAD - Daily Technical Levels

Support

Pivot Point

Resistance 

1.3144

1.3192

1.3222

1.3114

1.327

1.3036

1.3348

 

USD/CAD - Daily Trade Sentiment

Taking a look at the 4-hour chart, the USD/CAD is testing the double bottom support level around 1.3160. The bearish breakout of this level is likely to expose the USD/CAD to the next support level of 1.3110. 

The Lonnie is forming neutral candles above 1.3160, which is signaling indecision among traders. This means we can also expect a bullish correction above 1.3160 to capture quick pips until 1.3200. The MACD is in the selling area, but the recent histograms are smaller than the previous one.  

 

AUD/USD – 50 EMA Support Plays Well, What's Next?

The AUD/USD closed at 0.68745 after placing a high of 0.68891 and a low of 0.68041. Overall the trend for AUD/USD pair remained strongly bullish. At 4:30 GMT, the Westpac Consumer confidence from Australia came in as unfavorable -1.9% in comparison to the previous 4.5%.

On the other hand, at 18:30 GMT, the Consumer Price Index (CPI) for November was released from the United States and showed growth to 0.3% from the expected 0.2%. The AUD/USD supported the U.S. dollar on Wednesday. However, the Core Consumer Price Index (CPI) from the U.S. remained flat with the expectations and previous month's 0.2%.

On the trade talks front, the U.S. President Donald Trump has days left to decide whether to impose tariffs on Chinese goods on December 15. This move is such an action that would not be welcomed in both countries in the United States and China.

The top economic and trade advisers of White House, including Larry Kudlow, Robert Lighthizer, Peter Navaro, and Treasury Secretary Steven Mnuchin, will meet U.S. President Trump in the coming days to decide the fate of upcoming tariffs.

Though it has not been decided yet, there is news about the delay in these upcoming tariffs by Washington. If White House allows these tariffs to take effect on December 15, then the US-China trade talks are likely to come to an end for the remainder of President Trump's term.

Some trader experts say that the way these tariffs are written will automatically go into effect, or the Trump administration has to act to impose them unless the U.S. trade representative issues a modification notice for these tariffs.

The director of White House National Economic Council, Larry Kudlow, told the media that "the reality is those tariffs are still on table, the December 15 tariffs, and the President has indicated if the short strokes remaining in negotiations do not pan out to his liking than those tariffs could go back into place".

In late-night Wednesday, Federal Reserve held its interest rates steady and said that it would maintain its rates where they were through 2020. This raised AUD/USD to its highest level since November 11 at 0.68891 amid weakened U.S. dollar.

The U.S. dollar index fell to 97.08 from 97.6 on Wednesday, and the 10-year U.S. Treasury Yields also fell to 1.80%. Weakened U.S. dollar gave strength to Aussie and helped the pair AUD/USD to gain traction.

AUDUSD

 

AUD/USD - Technical Levels 

Support

Pivot Point

Resistance

0.6831

0.686

0.6905

0.6786

0.6934

0.6712

0.7008

 

AUD/USD - Daily Trade Sentiment

The AUD/USD is trading with bullish sentiment since it has already violated the descending triangle pattern on the 4-hour timeframe. The triangle pattern was extending resistance around 0.6845 lately. 

At the moment, the AUD/USD is trading bullish around 0.6880, having immediate support around 0.6860, while the resistance stays around 0.6920. The pair may continue trading bullish after exhibiting a slight drop in the AUD/USD. 

 


 

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