The dollar held steady at a 14-year peak against the other majors currencies on Thursday, amid ongoing optimism over the U.S. economy and as trading volumes were set to remain thin for the Thanksgiving holiday.
The greenback remained supported amid expectations that President-elect Donald Trump’s plans to ramp up fiscal spending and cut taxes will spur economic growth and inflation. It has also been boosted by bets that the U.S. central bank will almost certainly raise interest rates next month. Fed Chair Janet Yellen on Thursday reiterated that a rate hike “could well become appropriate relatively soon”.
Today the U.K. is to round up the week with revised data on third quarter growth.
The euro edged higher against the U.S. dollar on Thursday, bouncing off a 20-month low after data showed that the German business climate remains solid in November, although ongoing support for the greenback limited the single currency’s gains.
EUR/USD eased off 1.0518, the pair’s lowest since March 2015, to hit 1.0576 during European morning trade, up 0.21%.
Always on Thursday the Ifo institute said its business climate index ticked down to 110.4 this month, from 110.5 in October, but was still strong; even if economists had expected a reading of 110.5.
Pivot: 1.0585Support: 1.051 1.046 1.04Resistance: 1.0585 1.0615 1.066Scenario 1: short positions below 1.0585 with targets at 1.0510 & 1.0460 in extension.Scenario 2: above 1.0585 look for further upside with 1.0615 & 1.0660 as targets.Comment: as long as the resistance at 1.0585 is not surpassed, the risk of the break below 1.0510 remains high.
Gold
Gold prices eased on Thursday, after falling to their lowest levels since February, as the dollar paused after surging to fresh 14-year peaks.
The dollar rallied after upbeat U.S. data and Wednesday’s Federal Reserve minutes cemented expectations for a rate hike next month. The minutes from the Fed’s November meeting said an interest-rate increase was possible “relatively soon” if data indicated that the economy is improving, and some Fed officials explicitly called for a rate hike in December.
Prices of the yellow metal had already come under pressure this month, amid the view that increased U.S. fiscal spending under a Trump administration will spur economic growth and inflation, which would ultimately lead to an era of higher interest rates.
Pivot: 1196Support: 1171 1166 1158Resistance: 1196 1202.7 1215Scenario 1: short positions below @ 1183.00 with targets @ 1171.00 & 1166.00 in extension.Scenario 2: above 1196.00 look for further upside with 1202.70 & 1215.00 as targets.Comment: the RSI is mixed to bearish.
WTI Oil
Oil prices edged higher on Thursday, as uncertainty over a planned OPEC-led output cut and thin liquidity due to the U.S. Thanksgiving holiday weighed.
Traders said market activity was low due to the U.S. holiday, and there was a reluctance to take on big price bets due to uncertainty about a planned oil production cut, led by the OPEC. OPEC is due to meet on Nov. 30 to coordinate a cut, potentially together with non-OPEC member Russia.
Russia could revise down its 2017 oil production plans, if a global output freeze pact comes into force, effectively cutting output by 200,000-300,000 barrels per day, as said on Thursday by Energy Minister Alexander Novak.
Pivot: 48.5Support: 47.15 46.38 45.8Resistance: 48.5 49.22 49.79Scenario 1: short positions below 48.50 with targets at 47.15 & 46.38 in extension.Scenario 2: above 48.50 look for further upside with 49.22 & 49.79 as targets.Comment: the RSI is mixed with a bearish bias.
US 500
Trading on U.S. shares was closed on Thursday, and will be closed today, due to the Thanksgiving holiday in America.
Online spending by U.S. bargain hunters climbed to above $1 billion by Thanksgiving evening, surging almost 14% from a year ago and reflecting a broader trend away from brick-and-mortar shopping.
At the start of the first holiday shopping season since the election of Donald Trump as president on November 8, U.S. consumers loosened their purse strings and spent $1.15 billion online between midnight and 5 pm ET on Thursday.
Traditionally the day after Thanksgiving, or Black Friday, has started the holiday shopping season in the United States with retailers offering steep discounts and turning a profit. But its popularity has been on the wane given the emergence of online shopping and cheap deals through the year from retailers including e-commerce giant Amazon.com Inc (NASDAQ:AMZN). The holiday season spanning November and December is crucial for retailers because it can account for as much as 40% of annual sales. Retailers try to attract shoppers with deep discounts, sometimes as much as 85%. The National Retail Federation expects holiday sales to grow 3.6 percent this year to $655.8 billion.
Pivot: 2191 Support: 2191 2169 2169 Resistance: 2216 2247 2275 Scenario 1: long positions above 2191.00 with targets @ 2216.00 & 2247.00 in extension. Scenario 2: below 2191.00 look for further downside with 2179.00 & 2169.00 as targets. Comment: the RSI is bullish and calls for further advance.