USD/CNH: Chance to rise above 7.2200 – UOB Group

FXStreet Insights Team FXStreet

The US Dollar (USD) could rise above 7.2200; the next resistance at 7.2400 is unlikely to come into view. In the longer run, surge in momentum suggests further USD strength, but the pace and extent is likely to be more moderate. The level to watch is 7.2400, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

The level to watch on the upside is 7.2400

24-HOUR VIEW: “We indicated that despite USD surging in early Asian trade yesterday, ‘the impulsive advance could extend to 7.1550 before levelling off.’ However, USD surged further to 7.2095, closing on a strong note at 7.2040 (+1.48%). Not surprisingly, conditions are severely overbought. However, USD could rise above 7.2200. The next resistance at 7.2400 is unlikely to come into view. To maintain the momentum, USD must not break below 7.1600 (minor support is at 7.1800).”

1-3 WEEKS VIEW: “Yesterday (05 Nov, spot at 7.1340), we revised our negative view to neutral, indicating that ‘downward momentum has largely faded.’ We also indicate that USD ‘could trade in a broad 7.0900/7.1800 range.’ We clearly did not anticipate USD to lift off and skyrocketed to 7.2095. The surge in momentum suggests further USD strength, but severely overbought conditions suggest the pace and extent is likely to be more moderate. The level to watch on the upside is 7.2400. On the downside, should USD breach 7.1300, it would indicate that the rally is ready to take a breather.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD pulls back from monthly high but holds above 0.7000

AUD/USD retreats from the monthly high set earlier this Thursday, sliding back to 0.7000 during the Asian session as a further escalation of tensions in the Middle East undermines the risk-sensitive Aussie. However, recent hawkish comments from RBA officials could support the Australian Dollar. Furthermore, the prevailing US Dollar selling bias, despite Fed hike bets and geopolitical uncertainties, could limit losses for the pair.

USD/JPY declines to a one-week low; eyes trading range support near 157.50 on weaker USD

USD/JPY drops to a one-week low during Thursday’s Asian session, with bears now awaiting a break below multi-week range support near mid-157.00s before placing fresh bets amid a broadly weaker US Dollar. Despite bets for a December Fed rate hike and Middle East jitters, the recent decline in US bond yields keeps USD depressed near a three-week low. Moreover, hawkish BoJ expectations and intervention risks underpin the Japanese Yen, further weighing on the currency pair.

Gold extends fall below $4,100 as Fed hike bets counter USD weakness

Gold weakens further below $4,100, hitting a fresh one-week low as oil-driven inflation risks reinforce Fed hike bets and weigh on the bullion heading into the European session. Meanwhile, falling US bond yields keep the US Dollar depressed near a three-week low despite geopolitical uncertainties. This, however, does little to support the non-yielding bullion, backing the case for further losses.

Cardano: Weak momentum puts ADA recovery at risk

Cardano (ADA) is trading below $0.222 on Thursday after failing to sustain gains above the 50-day Exponential Moving Average near $0.228 the previous day. Weakening derivatives metrics and fading bullish momentum continue to weigh on sentiment, while a break below the 100-day EMA could push ADA lower.

Dow Jones Industrial Average climbs with the AI trade, led by a bank

The Dow Jones Industrial Average got most of its share of Wednesday's artificial intelligence (AI) rally from a bank and a bulldozer maker. The index closed near 52,800, its highest close since early September. SpaceX (SPCX) reported 161% revenue growth and the Nasdaq Composite rose more than 1%, but under price weighting the gains that counted most belonged to Goldman Sachs (GS) and Caterpillar (CAT).

The US Dollar fell. Gold didn't rally. That tells you everything

Gold (XAU/USD) is struggling to capitalize on a weaker US Dollar (USD), after repeatedly failing to establish itself above the $4,200 level. The precious metal remains confined to a relatively narrow trading range despite a combination of developments that would normally support higher prices.