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02 Dec 2016
By Ipek Ozkardeskaya
Pound rises on single market hope
The US dollar depreciated against all of its G10 counterparts in Asia, except the Aussie (-0.08%). The US jobs data will be a major highlight before the weekly closing bell, yet the data is expected to have a little impact on the asset prices, unless we have a sizeable disappointment that could imperil the Federal Reserve’s (Fed) plans to hike interest rates in December.
The AUDUSD traded in the tight range between 0.7401/0.7433, despite better-than-expected Australian retail sales data in October. There is a solid resistance at 0.7433 (Fib 50% retracement on Nov 30th to Dec 1st decline), before the critical 0.7500-handle. The low conviction in carry trades, amid the steep upswing in global yields, suggests a bumpy ride on the upside. Decent 0.7450-put is to expire before the weekly closing bell.
The USDJPY remains well bid despite a softer US dollar. There are no major barriers pre-115.00. The EURJPY extended gains to 121.80, despite looming Italian referendum risks. We could see a minor correction to the hourly Ichimoku cloud cover 121.40 /120.60, should traders avoid taking the event risk before Sunday’s referendum.
The WTI pares gains after having tested the $52/barrel. We could see a deeper correction to $50.44 (minor 23.6% retracement on post-OPEC rally) and to $49.40 (major 38.2% retrace). Surpassing $52.00/52.50 should pave the way for a mid-term rise to $55.
Gold and the EURUSD are rangebound. The Italian referendum risk should keep the euro traders sideways heading into the weekend. Any USD-induced volatility is expected to remain short-lived. Traders should be ready for high volatility across the EUR-crosses at Monday's open.
The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest and nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please note that 71% of our retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing money.
