XAU/USD Current price: $2,029 XAU/USD rose after being able to hold above $2,010. The stronger Dollar keeps the upside limited, despite lower yields. Gold needs to rise above $2,045 to improve the short-term outlook. Gold spot rose, offering signs of stabilization after the sharp reversal from record highs above $2,130 to $2,008 (Dec 5 low). It is consolidating near the $2,030 support level, on the back of lower Treasury yields but lacking upside momentum amid a stronger US Dollar. Data released in the US on Wednesday included the ADP employment report, which showed an increase in private payrolls by 103,000, below the market consensus of 130,000. The Unit Labor Cost data indicated a decline of 1.2% during the third quarter. Despite these figures pointing to a more balanced labor market and less inflationary pressures, the US Dollar remained resilient. More US employment data is due on Thursday, with the weekly Jobless Claims, and on Friday, the critical Nonfarm Payrolls report will be released. While the numbers are expected to show further softness, the impact on the US Dollar has been limited so far and has not significantly altered the positive momentum. Even the decline in the 10-year Treasury yield to 4.12%, the lowest since early September, has not provided a boost to Gold. The yellow metal remains in a bullish long term trend but is far from the all-time highs it reached just two days ago. XAU/USD short-term technical outlook Gold managed to post a daily gain after a sharp decline. The recovery came after successfully defending the $2,010 area. Currently, the price is moving within a range between $2,035 and $2,020. The bearish momentum has been persistent, but signs of stabilization have started to emerge. On the 4-hour chart, the technical indicators are biased to the downside but lack strong conviction. The price is holding below the 20-Simple Moving Average, (SMA) which is situated at $2,043. The risk appears tilted to the downside, with a break below $2,020 exposing $2,010 and potentially the $2,000 zone. On the upside, a recovery above $2,050 would change the short-term bias to neutral or positive. Support levels: $2,020 $2,010 $1,990 Resistance levels: $2,031 $2,045 $2,072

AUD/USD Current Price: 0.6563 Australia's Q3 GDP growth came in at 0.2% compared to the previous quarter, below the expected 0.4%. The US ADP report came in below expectations; Jobless Claims are due on Thursday, followed by NFP on Friday. The AUD/USD rebounded but still faces bearish pressure. The AUD/USD rose modestly after experiencing sharp declines over the past two days. The pair reached a peak at 0.6599 on Wednesday but then retraced, trimming gains and indicating ongoing bearish pressure. Despite lower Treasury yields and softer labor market data, the US Dollar remained firm. On Wednesday, Australia reported that Gross Domestic Product (GDP) expanded by 0.2% during the third quarter, below the 0.2% of the previous quarters. The annual growth rate came in at 2.1%, slightly higher compared to Q2 but largely reflecting revisions to previous quarters. While the figures did not have a significant impact on markets during a quiet session, they provide evidence of a slowing economy. As data continues to soften and inflation moves in the right direction, the markets do not anticipate more rate hikes from the Reserve Bank of Australia (RBA). Price expectations are starting to reflect potential rate cuts by mid-2024. On Thursday, Australia will release trade data and the Building Permits report for October. Later, the focus will turn to China's trade figures from November, which could be relevant for risk sentiment. In the US, the ADP Employment Report came in below expectations, and overall reports continue to show easing inflationary pressures. US yields continue to move lower, with the 10-year hitting fresh multi-month lows. However, the US Dollar remained firm. More employment data is due on Thursday with Jobless Claims, and on Friday, the Nonfarm Payrolls report could challenge the strength of the Dollar. AUD/USD short-term technical outlook The AUD/USD reached a bottom on Wednesday at 0.6540, slightly above the 20-day Simple Moving Average (SMA), and then rebounded towards 0.6600. However, it lost momentum and dropped back towards 0.6550. The bearish momentum eased, suggesting potential consolidation ahead. On the 4-hour chart, the risks are tilted to the downside as the price remains below a bearish 20-SMA and an uptrend line. Technical indicators initially favor the downside, with momentum and the Relative Strength Index (RSI) moving lower, while the Moving Average Convergence Divergence (MACD) remains firmly negative. A consolidation below 0.6540 could pave the way for further downside towards 0.6530, followed by 0.6495. On the upside, a reclaiming of 0.6610 would remove the near-term bearish bias. Support levels: 0.6545 0.6530 0.6510  Resistance levels: 0.6590 0.6610 0.6640 View Live Chart for the AUD/USD 

XAU/USD Current price: $2,029 XAU/USD rose after being able to hold above $2,010. The stronger Dollar keeps the upside limited, despite lower yields. Gold needs to rise above $2,045 to improve the short-term outlook. Gold spot rose, offering signs of stabilization after the sharp reversal from record highs above $2,130 to $2,008 (Dec 5 low). It is consolidating near the $2,030 support level, on the back of lower Treasury yields but lacking upside momentum amid a stronger US Dollar. Data released in the US on Wednesday included the ADP employment report, which showed an increase in private payrolls by 103,000, below the market consensus of 130,000. The Unit Labor Cost data indicated a decline of 1.2% during the third quarter. Despite these figures pointing to a more balanced labor market and less inflationary pressures, the US Dollar remained resilient. More US employment data is due on Thursday, with the weekly Jobless Claims, and on Friday, the critical Nonfarm Payrolls report will be released. While the numbers are expected to show further softness, the impact on the US Dollar has been limited so far and has not significantly altered the positive momentum. Even the decline in the 10-year Treasury yield to 4.12%, the lowest since early September, has not provided a boost to Gold. The yellow metal remains in a bullish long term trend but is far from the all-time highs it reached just two days ago. XAU/USD short-term technical outlook Gold managed to post a daily gain after a sharp decline. The recovery came after successfully defending the $2,010 area. Currently, the price is moving within a range between $2,035 and $2,020. The bearish momentum has been persistent, but signs of stabilization have started to emerge. On the 4-hour chart, the technical indicators are biased to the downside but lack strong conviction. The price is holding below the 20-Simple Moving Average, (SMA) which is situated at $2,043. The risk appears tilted to the downside, with a break below $2,020 exposing $2,010 and potentially the $2,000 zone. On the upside, a recovery above $2,050 would change the short-term bias to neutral or positive. Support levels: $2,020 $2,010 $1,990 Resistance levels: $2,031 $2,045 $2,072 View Live Chart for XAU/USD  

Our most striking FX call for next year is that 2024 will be the year that the dollar finally turns lower. In our view, the best-performing currencies will be those which are most undervalued – step forward the Australian dollar and the Norwegian krone. And do not expect European currencies to lead the pack. The Dollar to turn lower As we discussed in our 2024 FX Outlook, we think the dollar should be due a cyclical downturn next year. Barring huge and unexpected risk premia emerging in the currency space, the dominant trend should be US growth converging on the weak levels seen in Europe and Asia, the Federal Reserve embarking on an easing cycle, and the dollar falling 5-10%. That view really does hinge on the Fed being able to cut rates and a clean bullish steepening trend playing out in the US yield curve. Typically this coming stage of the economic cycle should see commodity currencies outperform – which fortunately is also one of our calls (see next section). The main threats to our dollar view are enduring US economic strength or another identity crisis in the eurozone – recall EUR/USD failed to rally in 2001, despite the Fed cutting nearly 500bp. The currencies of Australia and Norway to outperform Fighting the dollar bull trend has been an exercise in futility for most of this year. Currencies prepared to challenge the dollar are going to need some help. And both the Australian dollar and Norwegian krone are packing undervaluation in their armoury. These are the currencies most undervalued according to our medium-term fair value model, where divergence from better export prices is the core story. In effect, the higher US rate environment has prevented these currencies from aligning with the commodity price rally seen in the second half of this year. European currencies set to lag Unlike the commodity currencies, neither the euro nor the pound are particularly undervalued against the dollar. We do think the dollar story will be enough to drag EUR/USD higher through 2024 – 1.15 is our year-end target – but the moves should be relatively modest. EUR/USD will be trying to rally while the eurozone is in recession. It will also face the challenge of an increasingly dovish European Central Bank, if our call is correct for the first ECB rate cut in June. And weak eurozone growth typically spells trouble for some of the eurozone's peripheral government bond markets too. As to the pound, a 100bp Bank of England easing cycle will create headwinds for GBP/USD. We do not foresee the UK election demanding a big risk premium of the pound, but we doubt it will provide a tailwind either.  Read the original analysis: Three calls for FX markets

The American dollar is fighting hard for the trend. For the last three trading sessions, the dollar index has been crossing up and down the 200-day moving average every day. All in all, the flirting with this level has been going on for more than three weeks, during which neither bulls nor bears were able to form a stable trend. Right now, there are about equal chances of a trend forming in one direction or the other, so it is worth watching closely to see which trend crystallises. The dollar bumped around in October and declined sharply in November, with only some stabilisation late last month. The recent settlement, from this point of view, looks like an attempt to stand still and gather strength before a new downward impulse. The first signal to switch to a bearish bias could be a sharp downward impulse under the 200-day average at 103.3 versus the current 103.6. The final confirmation will come in the form of an update of the November lows at 102.37. But the situation is far from desperate for the bulls as well. The dollar showed a convincing close last month, managing to rebound sharply to close the month above the significant 200-day moving average. An attempt to sell the dollar last Friday failed to gain traction, and the index returned to growth on Monday. The latest dollar momentum at least created a springboard for a broader bounce and extended profit-taking. A classic Fibonacci retracement of the November decline amplitude opens upside potential at 104.12 (+0.5% from current levels). The dollar's ability to overcome the last level and further gain will be the final confirmation of the trend change to growth. Among other factors, we note the extremely dovish expectations from the Fed: rate futures give a 14.5% chance of a cut already in January, and at the March meeting, the odds of a cut exceed 62%. Less than two months ago, the market was giving roughly equal odds between raising and keeping rates on hold. This dramatic revision in expectations has been the fundamental fuel for the weakening dollar and the rally in equities. In contrast, the Fed is more inclined to raise the rate and is setting up for an extended period of holding it. The return of market expectations to those of the Fed looks like a strong case for a dollar recovery in the coming weeks.

Gold price is licking its wounds near $2,020 amid a broad retreat in the US Dollar. Gold price uptick appears capped by positive US Treasury bond yields. Gold price awaits US ADP jobs data for a fresh boost, as technical stay supportive. Gold price is making a minor recovery attempt near $2,020 early Wednesday, replicating the move seen in Tuesday's Asian trading. Risk sentiment appears to be in a tepid spot, underpinning the Gold price alongside a pause in the US Dollar upswing. Gold price looks to US ADP jobs report The US Dollar has stalled its two back-to-back days of recovery even though markets have turned cautious after Moody's Investors Service downgraded its outlook on China's government credit ratings to negative from stable. The rating agency, however, retained China's "A1" long-term rating on the country's sovereign bonds. Also, uncertainty surrounding the US Federal Reserve (Fed) interest rate outlook tempers investors' sentiment, especially after a mixed set of US economic data released on Tuesday. The latest data from the Institute for Supply Management  (ISM) showed that the Services PMI registered 52.7 in November, firming up from October's reading of 51.8. However, US JOLTS Job Openings slid to more than a 2-1/2-year low of  8.733 million in October, suggesting that labor market conditions are loosening further. Markets continue pricing about 60% odds of a Fed rate cut in March but investors await Wednesday's US ADP Employment Change data for placing fresh bets on the US Dollar and Gold price. The ADP is likely to show that the American private sector added 130K jobs in November, up from 113K jobs addition seen in October. A smaller-than-expected increase in the US ADP jobs data could bolster dovish Fed bets, fuelling further downside in the US Dollar. In such a case, Gold price could extend its renewed upside toward $2,050. On the contrary, a souring risk sentiment and strong US jobs report could offer additional support to the ongoing US Dollar recovery, offering a fresh leg lower in Gold price. Gold price technical analysis: Daily chart Nothing seems to change for Gold price technically in the near term, as its bullish bias is likely to remain in place. The 14-day Relative Strength Index (RSI) indicator is inching higher above the midline, justifying the bounce in Gold price. Further, the Golden Cross, as represented by the 50-day Simple Moving Average (SMA) and the 200-day SMA bullish crossover, remains in play. Gold buyers need to find acceptance above the $2,050 psychological barrier on a daily closing basis to resume the uptrend toward the intial hurdle at $2,100. A sustained move above the latter will challenge all-time-highs of $2,144 once again. On the flip side, the immediate support is seen at the $2,000 threshold should the Gold price correction regain traction. The 21-day SMA at $1,995 wil then come to the rescue of Gold buyers.  The last line of defense for Gold buyers is seen at the $1,990 round figure.