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The Australian dollar continues to takes traders on a roller-coaster. AUD/USD has surged 0.85% on Monday, recovering most of the 1% decline on Friday. In the European session, the Australian dollar is trading at 0.6443 at the time of writing.

The week ended with a rebound from US nonfarm payrolls. In November, nonfarm payrolls climbed by

227 thousand, above the market estimate of 200 thousand. This followed a very weak October report, which was revised upwards to 36 thousand from 12 thousand. The unemployment rate ticked higher to 4.2% as expected, up from 4.1% in October. The employment data has raised expectations of a quarter-point hike at the Dec. 18 meeting, with the odds currently at 87%, up sharply from 62% a week ago.

The Australian dollar took a tumble after the strong nonfarm payroll numbers, but has quickly recovered after China’s inflation was lower than expected. In November, CPI eased to 0.2% y/y, down from 0.3% in October and short of the market estimate of 0.5%. Monthly, CPI declined by 0.6%, down from -0.3% in October and lower than the market estimate of -0.6%.

The weak Chinese inflation data has raised expectations that China’s central bank will respond by lowering interest rates. That would help boost the economy and increase demand for Australian exports and the Australian dollar has responded with sharp gains today.

The Reserve Bank of Australia meets on Dec. 10 and is widely expected to maintain the cash rate at 4.35%, where it has been for over a year. The markets aren’t expecting a rate cut before May 2025, although a surprise decline in inflation in the coming months could push the central bank to lower rates in Q1 2025.

AUD/USD Technical

• AUD/USD has pushed above resistance at 0.6407 and is testing resistance at 0.6492. Above, there is resistance at 0.6492
• 0.6356 and 0.6322 are the next support lines

EURGBP stands at the back foot on Monday and retraces more of Thursday’s jump, signaling that near-term correction (off 0.8260 low) might be over.

Larger downtrend remains intact, with firmly bearish daily studies (MA’s in full bearish configuration, 14-d momentum moved into negative territory since late Nov) maintaining downside pressure.

Immediate targets lay at 0.8267/60 (Dec 5 / 2024 low posted on Nov 11 ) guarding more significant supports at 0.8211/02 (50% retracement of larger 0.6924/0.9489 uptrend / March 2022 low), break of which to signal continuation of broader downtrend.

Falling 10DMA (0.8301) which closely tracks the price in past over one week, should cap upticks and keep larger bears intact.

Res: 0.8301; 0.8316; 0.8336; 0.8355
Sup: 0.8267; 0.8260; 0.8211; 0.8202

Gold price edged higher in early Monday trading following a $10 gap-higher opening, lifted by heated geopolitical situation and fresh demand.

Traders shifted into safer mode after Syrian rebels seized capital Damascus and took control over the country, with growing uncertainty about the near future, supporting gold price.

Another key driver of the yellow metal this morning was fresh demand from China, as PBOC resumed purchasing gold after a pause of six months.

Technical picture on daily chart improved (although still lacking clearer direction signal) as the price rose towards the top of near-term range ($2666, also 50% retracement of $2721/$2605 bear-leg, reinforced by 55DMA).

Persisting bullish momentum and rise above 10/20DMA’s develop initial positive signal, which will look for confirmation on sustained break through range ceiling, to open way for extension towards targets at $2677/93 (Fibo 61.8% & 76.4% respectively) and $2700 (psychological).

Holding and close above broken 10DMA ($2640) to keep fresh near term bulls intact, with larger bullish bias seen above daily cloud base ($2630).

Res: 2666; 2677; 2693; 2700.
Sup: 2640; 2630; 2613; 2605.

The Japanese yen has edged lower on Monday. In the European session, USD/JPY is trading at 150.42, up 0.26% on the day.

Japan’s GDP revised upwards in Q3

Japan’s economy expanded in the third quarter by 0.3% q/q, according to the final estimate. This edged above the initial estimate and the market estimate of 0.2%. The improvement was due to increases in capital investment and exports. However, consumption was revised downwards.

The Bank of Japan makes its rate announcement on Dec. 19 and today’s GDP data will be carefully scrutinized by Bank policymakers. The drop in consumption could be a concern for the central bank, which wants to see inflation driven by stronger demand. The meeting is live as it remains unclear whether the BoJ will press the rate-hike trigger or remain on the sidelines.

The BoJ tends not to be transparent about its rate path, one reason being that it wants to dissuade speculators from betting on the yen’s movement. Still, it’s clear that the BoJ is moving slowly towards normalization and another rate hike is very likely just a question of time. Governor Ueda has hinted a hike but a dovish member of the Bank, Toyoaki Nakamura, said on Thursday that consumption remains weak and the increase in wages may not be sustainable.

US nonfarm payrolls recover

US nonfarm payrolls bounced back in November with a gain of 227 thousand, above the market estimate of 200 thousand. This follows a weak October report, which was revised upwards to 36 thousand from 12 thousand. The unemployment rate ticked higher to 4.2% as expected, up from 4.1% in October.

The data has raised expectations of a quarter-pint hike at the Dec. 18 meeting, with the odds currently at 878%, up sharply from 62% a week ago.

USD/JPY Technical

• USD/JPY is testing support at 150.18. Below, there is support at 149.59
• There is resistance at 150.71 and 151.30

• Gold extends narrow horizontal move above $2,630
• Buying sentiment could stay muted below $2,680

Gold remained indecisive within its ten-day tight range on Monday, unable to close above $2,650 despite Friday’s upbeat US jobs data and the recent geopolitical turmoil in the Middle East and South Korea.

Technically, the safe-haven metal survived another drop below its 20-day simple moving average (SMA) at $2,630, but downside risks have not evaporated yet.

For a clear bullish signal, the price must re-enter its broken broad bullish channel above the 50-day SMA and the resistance line at $2,680. In this case, the recovery phase could extend to $2,710 or even to $2,750. Then, if the all-time high of $2,789 proves easy to pierce through, the bulls could target the $2,810 area.

On the flip side, if the price closes below $2,630, support could immediately come around $2,590-$2,600. The $2,450-$2,555 territory could prevent an aggressive downfall toward the $2,483-$2,500 region.

In summary, gold is in a neutral mode ahead of a busy period of central bank meetings and uncertain geopolitical developments and could retain the status quo unless the price jumps above $2,680 or falls below $2,630.

Market Picture

The cryptocurrency market corrected 1.2% in 24 hours, but the 5% gain for the week still indicates a strong bull market despite more frequent mini-corrections. Bitcoin is failing to consolidate above $100K, which is likely suppressing buying in the overall cryptocurrency market.

Bitcoin is trading just below $99K with minimal overnight movement. Its inability to grow has negatively impacted altcoins. We view Bitcoin’s lull as an important position correction that will help the market shake off short-term overbought conditions and move more reliably higher. The next upside momentum could take the price to the $120K area, working off the Fibonacci extension.

Ethereum loses 2%, also failing to consolidate above $4000 and falling just a few dollars short of updating the year’s highs. The coin doesn’t see meaningful support until the $3700-3800 area.

News Background

According to SoSoValue, net inflows into spot bitcoin ETFs in the U.S. totalled $2.73 billion last week, following outflows of $138.1 million the previous week. Cumulative inflows since bitcoin ETFs were approved in January rose to $33.43 billion.

Net inflows into the Ethereum ETF rose to a record $836.7 million last week after inflows of $446.5 million the previous week. Cumulative net inflows since the ETF’s launch in July rose 2.5 times to $1.41 billion for the week.

BlackRock and MARA Holdings bought 7,750 BTC and 1,423 BTC, respectively, as the former cryptocurrency’s price fell to $90,500.

Former US Treasury Secretary Lawrence Summers called Trump’s plan to create a strategic reserve in bitcoins “insane.” In his view, the only reason for such a move is “to coddle generous campaign donors.”

The SEC has notified at least two of the five issuers of spot Solana ETFs that it will reject their Forms 19b-4. The commission plans to consider new cryptocurrency ETFs once the agency’s leadership changes.

The AUD/USD chart reveals that since late October, the pair has been in a downtrend. This is largely driven by monetary policy differences: while the Federal Reserve has begun cutting interest rates, the Reserve Bank of Australia (RBA) has yet to initiate rate reductions.

Tomorrow, the RBA will announce its decision on interest rates. All 44 economists surveyed by Reuters expect the rate to remain at 4.35%, given persistently high core inflation (3.5%) and low unemployment.

Previously, experts forecasted rate cuts in the first quarter of 2025. However, most now anticipate reductions no earlier than the second quarter, as the RBA focuses on bringing inflation back to its 2–3% target range.

Meanwhile, the AUD/USD chart highlights that the price is sitting at a key support level (marked by a red line), which has already reversed the pair upward three times since the latter half of 2022 (indicated with arrows).

Tomorrow's crucial RBA decision is likely to strongly influence whether this support will manage to reverse the price upward for the fourth time. Monday's robust price action suggests that another upward reversal is possible.

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Investor sentiment in the Eurozone deteriorated sharply in December, with the Sentix Investor Confidence Index dropping to -17.5 from -12.8, significantly below expectations of -13.1. This marks the weakest reading since November 2023. Current Situation Index fell to -28.5, the lowest since November 2022, while Expectations Index slipped to -5.8 from -3.8. .

Germany remains a key drag, with its Current Situation Index sinking to -50.8, the lowest since June 2020, reflecting the persistence of recessionary pressures. The announcement of new Bundestag elections failed to inspire optimism, while France's ongoing government crisis has added another layer of economic uncertainty. Sentix highlighted that “the two largest countries in the Eurozone are dragging down the EU economy.”

ECB faces increasing pressure as investors expect stronger monetary support for the faltering economy. However, inflation concerns persist, with Sentix's inflation barometer holding at -12 points, signaling continued unease. This dual challenge highlights a conflict for ECB as it balances the need for economic stimulus with inflationary risks.

Full Eurozone Sentix release here.

Gold price is consolidating above the $2,600 support zone. Crude oil is showing bearish signs and might decline below $66.80.

Important Takeaways for Gold and Oil Prices Analysis Today

• Gold price started a recovery wave from the $2,610 zone against the US Dollar.
• A key bearish trend line is forming with resistance at $2,650 on the hourly chart of gold at FXOpen.
• Crude oil prices failed to clear the $70.00 region and started a fresh decline.
• There is a connecting bearish trend line forming with resistance at $67.50 on the hourly chart of XTI/USD at FXOpen.

Gold Price Technical Analysis

On the hourly chart of Gold at FXOpen, the price found support near the $2,610 zone. The price remained in a bullish zone and started a recovery wave above $2,620.

There was a decent move above the 50-hour simple moving average and $2,635. The bulls pushed the price above the $2,640 zone. Finally, the price climbed as high as $2,650 before the bears appeared. The price is now consolidating below $2,650.

There was a move below the 23.6% Fib retracement level of the upward move from the $2,613 swing low to the $2,650 high, and the RSI is stable above 50.

Initial support on the downside is near $2,632. The first major support is near the $2,628 zone. It is near the 61.8% Fib retracement level of the upward move from the $2,613 swing low to the $2,650 high. If there is a downside break below the $2,628 support, the price might decline further.

In the stated case, the price might drop toward $2,612. Any more losses might push the price toward the $2,600 level. Immediate resistance is near the $2,650 level.

There is also a key bearish trend line forming with resistance at $2,650. The next major resistance is near the $2,655 level. An upside break above the $2,655 resistance could send Gold price toward $2,670. Any more gains may perhaps set the pace for an increase toward the $2,685 level.

Oil Price Technical Analysis

On the hourly chart of WTI Crude Oil at FXOpen, the price struggled to clear the $70.00 resistance zone against the US Dollar. The price started a fresh decline below the $68.80 support.

The price even dipped below the $67.80 level and the 50-hour simple moving average. The bulls are now active near the $66.80 level. A low was formed at $66.78 and the price is now consolidating losses. If there is a fresh increase, it could face resistance near the 23.6% Fib retracement level of the downward move from the $70.10 swing high to the $66.78 low.

There is also a connecting bearish trend line forming with resistance at $67.50. The first major resistance is near the $67.80 level, above which the price could rise and test the 61.8% Fib retracement level of the downward move from the $70.10 swing high to the $66.78 low at $68.80.

Any more gains might send the price toward the $69.60 level. Conversely, the price might continue to move down and revisit the $66.80 support. The next major support on the WTI crude oil chart is $66.00.

If there is a downside break, the price might decline toward $63.50. Any more losses may perhaps open the doors for a move toward the $61.20 support zone.

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Daily Pivots: (S1) 190.36; (P) 191.42; (R1) 192.12; More...

Intraday bias in GBP/JPY remains neutral at this point. Recovery from 188.07 might extend higher. But outlook will stay bearish as long as 55 D EMA (now at 193.97) holds. On the downside, below 190.33 minor support will bring retest of 188.07 first. Break there will target 183.70 support next.

In the bigger picture, price actions from 208.09 are seen as a correction to whole rally from 123.94 (2020 low). The range of consolidation should be set between 38.2% retracement of 123.94 to 208.09 at 175.94 and 208.09. However, decisive break of 175.94 will argue that deeper correction is underway.