News & Analysis

Dow Jones consolidates breakout; GBPUSD 9-week highs; USD strength drops Gold

Nov 30, 2017 | Daily Market Outlook

Today’s high impact news:

21:00 EUR CPI Flash Estimate
00:30 USD Unemployment Claims

U.S stocks closed mixed, the Dow Jones added 103.97 points to hit fresh record highs. The S&P500 closed slightly lower by 0.97 and the NASDAQ closed 87.97 points lower. The Dow Jones was lifted by bets the U.S. economy’s momentum would continue. The U.S. economy has picked up steam this year, growing at an annualized rate of more than 3 percent each of the past two quarters. The Senate Budget Committee approved the Senate’s tax plan on Tuesday, bringing the upper chamber closer to a floor vote, which is expected to take place Thursday. Inflation remains low in 2017 and public debt continues to need attention, key comments from Janet Yellen overnight.

Stocks in Europe closed mixed the FTSE closed 67.09 lower while the DAX added 2.34. Retail stocks led the gains on Wednesday, up 1.74 percent for the day. Britain and the European Union (EU) were reported to have reached a deal on a Brexit divorce bill on Tuesday. British newspapers said the final total would be approximately 50 billion euros ($59.2 billion). A deal over the bill would indicate London and Brussels are edging closer to a new phase in their negotiations.

FX had an interesting night, USD picked up on GDP and tax reform making gains to the CAD, AUD and JPY. The GBP hit 9-week highs to the USD as Brexit looks to be smoothing out. The stronger GBP did weigh on UK stocks. The EUR traded higher, strong gains to the JPY while struggling to make much headway to the USD. 1.1879 continues to offer resistance to EURUSD buyers. The AUDUSD continues to drift lower, losing 37 pips overnight. Sellers are starting to close in on last week’s low. Gold started the day in the black, USD strength knocked demand out, sellers took charge in the NY session knocking price $10 lower. Oil lost 33 cents after trading down to 56.73. A ministerial committee of oil producers recommended on Wednesday that OPEC and non-OPEC allies extend oil production cuts by nine months. Doubts over Russia’s willingness to extend the cuts through all of 2018 are weighing on prices. U.S. commercial crude inventories dropped by 3.4 million barrels, versus expectations for a 2.3 million barrel draw. Bitcoin continued to make headlines overnight rallying over 1000 USD in a day. Price hit 11,300 last night before dropping 1690 USD to settle back below 10,000 USD, fierce trade!

USDCAD – buyers enjoyed a stronger USD and unstable oil market to break above last week’s range high.   

Bitcoin – insane moves, looking at yesterday’s daily range of 9,000 – 11,441. The 5-hour chart show’s a trend break but you will need strong nerves / deep pockets to short this market : )

Good trading from Eightcap.

Sources; Reuters, CNBC

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