Gold may get a bullish momentum
Given the Thanksgiving holiday in the US, gold (XAU/USD) moved within a narrow range yesterday. XAU/USD rose only by 0.06%.
Geopolitical risks and fears of a trade war continue to support the price of gold as a safe haven asset. Russian President Vladimir Putin said that Russia might use its new hypersonic missile to attack decision-making centres in Ukraine in response to the launch of Western missiles on its territory. Also, US President-elect Donald Trump promised earlier this week that tariffs would be imposed on all goods from Canada, Mexico, and China, which could provoke trade wars. Investors appear convinced that Trump's policies will lead to higher inflation.
Meanwhile, the US Dollar Index (DXY) has been decreasing throughout the week in anticipation of prospects for further Federal Reserve (Fed) rate cuts, which is another factor supporting gold price growth. However, the US Personal Consumption Expenditure (PCE) Price Index figures indicated a slowing in disinflation, suggesting that the Fed may slow its rate-cutting cycle.
XAU/USD broke above the resistance level of $2,650 and began to grow during the Asian session. Now, the pair may rise towards the next resistance at $2,700. However, it may test $2,650 again before continuing to grow further.
Euro Struggles to Gain Momentum Despite Hawkish ECB Comments
The euro (EUR/USD) lost 0.1% against the US dollar (USD) during a rather quiet trading session on Thursday.
The EUR/USD exchange rate didn't change significantly yesterday, given the reduced trading volume on US markets due to a Thanksgiving holiday. Overall, the fundamental outlook for the pair is rather mixed. A lot of bearish factors have already been priced in, but investors still continue to lack strong reasons to invest in the euro. German annual inflation remained unchanged in November, contrary to forecasts of a second consecutive uptick. Political uncertainty in Germany, with federal elections scheduled for February 2025, and Franch, with a coalition government struggling to pass a budget, are putting more downward pressure on EUR/USD.
Conversely, the recent hawkish commentary from Isabel Schnabel, a member of the Executive Board of the European Central Bank (ECB), advocating for a gradual reduction in interest rates, has induced investors to temper their expectations of more aggressive rate cuts. Money markets now see only a 13% chance of a larger 50-basis-point (bps) rate cut by the ECB in December, whereas a 25-bps move is fully priced in.
EUR/USD was rising during the Asian and early European trading sessions. Today, traders should focus on the eurozone Consumer Price Index (CPI) report due at 10:00 a.m. UTC. It could offer hints on the ECB's next steps.
"Today's macro data releases in the eurozone should encourage the ECB hawks to object to a 50bp rate cut in December", said Carsten Brzeski, global head of macro at ING.
If CPI figures are higher than expected, EUR/USD may break above the 1.06100 level. However, lower-than-expected results may push the pair below 1.05000.
Bitcoin Trades Sideways
Bitcoin (BTC/USD) has been trading sideways in a range of $92,000–100,000 throughout the entire week, gaining 4% on Wednesday.
The Japanese investment company Metaplanet, also known as ‘Japanese Microstrategy’, plans to raise $62 million to purchase more Bitcoins. The company plans to raise funds through the issuance of debt securities. According to a statement from the company, this latest round of investment will increase their holdings to 1,794 coins. In November, the company already announced its intention to invest $11.3 million in Bitcoin purchases.
The TON Foundation has announced the launch of tokenized Bitcoin, tgBTC. This token will introduce Bitcoin's liquidity to the TON blockchain. The details of the project are outlined in the white paper for the TON Teleport BTC initiative. TON Teleport BTC acts as a cross-chain bridge, allowing users to send Bitcoin directly to the TON network and vice versa. This provides access to exchanges, lending platforms, and decentralised applications for users. TgBTC will enhance liquidity and facilitate crypto transactions. Owners can earn income from decentralised finance (DeFi) platforms and benefit from reduced transaction fees. The project aims to enhance security and transparency by integrating Bitcoin into the TON ecosystem.
BTC/USD has been trading sideways during Asian and early European trading hours. No important news that can influence the price dynamics is expected today. The analysts project the price to continue moving within the established range.