Sample Category Title

Bitcoin's robust rally continues at the start of this week, buoyed by the so-called "Trump Pump" effect. Cryptocurrency investors are optimistic about US President-elect Donald Trump's promises to create a more supportive and friendly regulatory environment for crypto businesses.

The crypto market has long struggled with a lack of regulatory clarity, and these anticipated policy changes are fueling strong positive sentiment. Expectation of a more defined regulatory framework is encouraging both institutional and retail investors to increase their exposure to Bitcoin, driving further price appreciation.

Such optimism is expected to persist through the rest of 2024, with Bitcoin setting its sights on the significant 100k mark.

Technically, Bitcoin is in clear upside acceleration as seen in D MACD. The immediate focus is on 161.8% projection of 58846 to 73608 from 66763 at 90647. Break could push Bitcoin a bit further higher to 200% projection at 96287.

The real test lies in medium term level at 100% projection of 24898 to 73812 from 52703 at 101617, which is slightly above 100k psychological level. Strong resistance could be seen there to bring consolidations on first attempt.

Australia's NABs Business Confidence Index jumped from -2 to 5, marking a notable improvement after a prolonged period of below-average sentiment. Business conditions remained stable at 7, while trading conditions saw a slight increase from 12 to 13. Profitability held steady at 5, and employment conditions edged lower from 5 to 3.

Gareth Spence, NAB’s Head of Australian Economics, highlighted the jump in confidence as an encouraging development, noting that it is “just one month” but shows "tentative improvement" in forward orders, suggesting possible momentum.

Input cost pressures continued to ease, with labor cost growth decelerating from 1.9% to 1.4% on a quarterly basis from 1.9%, and purchase cost growth slowing from 1.3% to 0.9%. Retail price growth, however, saw a rebound, rising from 0.6% to 1.1%.

Spence noted, "The survey, like other price indicators, continues to suggest an ongoing gradual easing in inflation pressure, but also that there is still some way to go in in the inflation moderation when we look at the consumer facing components”.

Full Australia NAB business confidence release here.

Australian consumer sentiment saw a solid rebound in November, with Westpac Consumer Sentiment Index climbing by 5.3% mom to reach 94.6. This marks a 14.4% rise from its mid-year low, leaving it just 5.4 points shy of the neutral 100 mark.

The improvement was led by increased optimism about the short-term economic outlook. The "economic outlook, next 12 months" sub-index jumped 8.7% to 100.9, the first optimistic reading (above 100) since post-COVID recovery. Confidence around personal finances also strengthened, with the "family finances, next 12 months" sub-index up 4.4% to 104.1. Meanwhile, Unemployment Expectations Index dropped by -7.2% to 120.5, indicating the highest level of labor market confidence since April 2023.

Westpac noted three important observations in November's sentiment trends. First, confidence reached 99.7 in the early survey period, prior to RBA’s rate decision, reflecting marked optimism. Secondly, consumer sentiment remained unaffected by RBA's decision to hold rates steady. Lastly, sentiment dropped sharply after US election result, averaging 91.1 in the survey’s latter half. This indicates an unusually wide range of ±5% for November's final read, suggesting a degree of uncertainty not typically seen.

Full Australia Westpac consumer sentiment release here.

Key Highlights

• Ethereum started a fresh surge above the $2,500 resistance zone.
• ETH price cleared a major bearish trend line with resistance near $2,680 on the daily chart.
• Bitcoin price extended gains and traded to a new record high above $88,000.
• Gold prices extended losses and traded below the $2,665 support.

Ethereum Technical Analysis

Ethereum started a fresh increase above $2,500 alongside Bitcoin. The bulls were able to pump ETH above the $2,550 and $2,650 resistance levels.

Looking at the daily chart, the price cleared a major bearish trend line with resistance near $2,680. It settled above the $2,800 level, the 100-day simple moving average (red), and the 200-day simple moving average (green).

It even surpassed the 50% Fib retracement level of the downward move from the $3,560 swing high to the $2,078 low. The bears are now protecting the $3,220 resistance.

The 76.4% Fib retracement level of the downward move from the $3,560 swing high to the $2,078 low is acting as a resistance. The next major resistance is near the $3,350 level. A daily close above the $3,350 resistance zone could start another steady increase.

In the stated case, the price may perhaps rise toward the $3,500 level. The next stop for the bulls may perhaps be near the $3,650 level.

On the downside, Ethereum might find support near the $3,000 level. The next major support is $2,950 and the 200-day simple moving average (green), below which the price could slide toward $2,800. Any more losses might call for a move toward the $2,650 level.

Looking at Bitcoin, there was a steady increase above the $80,000 level, and the price traded to a new all-time high above $88,000.

Economic Releases

• Fed's Waller speech.

• Dow Jones rising inside impulse wave 5
• Likely to reach resistance level 45000.00

Dow Jones index continues to rise inside the minor impulse wave 5, which previously broke the key resistance level 43500.00 and the resistance trendline of the daily up channel from August.

The active impulse wave 5 belongs to the weekly upward impulse sequence (C) from April of this year.

Given the clear weekly uptrend, Dow Jones index can be expected to rise to the next resistance level 45000.00 (target price for the completion of the active impulse wave 5).

EURUSD under bearish pressure
• Likely to fall to support level 1.0600

EURUSD currency pair is under bearish pressure after the earlier breakout of the key support level 1.0685, which has been reversing the price from the middle of June.

The breakout of the support level 1.0685 should strengthen the bearish pressure on this currency pair.

Given the simultaneously bullish USD sentiment and the bearish Euro sentiment seen across the FX markets today, EURUSD currency pair can be expected to fall to the next support level 1.0600 (former strong support from April).

The AUD/USD pair is navigating the week starting with a steady tone, trading around 0.6590. After a significant drop last Friday, triggered by disappointment over China's economic stimulus measures, the pair finds a momentary respite as it consolidates recent movements.

China's announcement of a significant debt reduction and support for local governments and economic growth fell short of full transparency, leaving investors wanting more details. Given China's crucial role as Australia's top trading partner, any economic shifts there have a pronounced impact on the AUD's performance.

The ongoing uncertainties surrounding the implications of Donald Trump's U.S. presidential win also continue to influence market sentiment, particularly regarding U.S.-China relations.

This week is pivotal for Australian data with the release of Q3 payroll statistics and overall employment data, which are essential for assessing the Reserve Bank of Australia's (RBA) future monetary policy decisions. Additionally, RBA Governor Michele Bullock's participation in a regulatory panel might offer fresh insights into the central bank's views on inflation and economic demand.

AUD/USD Technical Analysis

Currently, AUD/USD is hovering around 0.6589 within a tight consolidation range. Anticipations lean towards a downward breakout towards 0.6544, potentially extending to 0.6494 before reversing. Upon reaching these levels, a reversal towards 0.6715 may be considered, with an interim target at 0.6600. The MACD indicator supports a bearish outlook in the short term, as it points downwards from above the zero line.

On the hourly chart, after completing a decline to 0.6557 and a subsequent correction to 0.6600, expectations are for a further dip to 0.6544. Success in reaching this level may prompt a rebound to 0.6600, testing from below before possibly resuming the downward trend towards 0.6494. The stochastic oscillator, currently below the 50 mark, underscores the potential for further declines.

The dollar continues to rise on speculation of policy changes following the US election. The Dollar Index rose above 105.5 on Monday – its highest level since early July – before easing slightly in trading.

The main contributors to the index’s strength are weakness in the single currency and the Japanese yen. In both cases, there is a cocktail of political uncertainty and fears that Trump’s protectionist policies will hurt EU and Japanese exporters.

The EURUSD has pulled back to the 1.0650 area. Over the past 12 months, it has only traded below this level for a few days in April. The pair reversed sharply from the 1.20 area after the so-called Trump trade began in early October.

Now that the Republicans have indeed come to power, we should expect further declines in the pair. The next important milestone on the way down is the 1.05 area, where we should expect a global shakeout, as this is historically the most important pivot area for the EURUSD. In 2022 and 2000, a break below 1.05 opened the door to a move well below parity. Conversely, if the EURUSD bulls can defend this level, the rally could be long and high.

USDJPY jumped 0.8% on Monday, back to last week’s local highs at 154. The pair has risen more than 10% from the mid-September lows and has made intra-week highs for ten consecutive weeks. The drivers were first disappointed with the pace of monetary tightening, then the Trump trade. Political reshuffles following the surprise defeat of the ruling party and uncertainty about further rate hikes have also played a role.

If we consider the 14% drop in USDJPY from 162 to 139 as a correction of the rise since the beginning of 2020, the new upside momentum promises to end closer to 200. However, only the passivity of the Treasury and the BoJ in breaching the 162 level will confirm the end of this monumental scenario.

EURUSD started the week negatively (down 0.7% until early US trading on Monday, in extension of Friday’s 0.8% drop, with total loss of 2.7% since announcement of Trump’s victory on Wednesday.

The single currency has also registered a weekly loss of 1.8% vs dollar, with near term action weighed by large weekly bearish candlestick and formation of bearish engulfing pattern on weekly chart.

Fresh strength of the US dollar pushed the euro to the lowest in over 6 months on Monday, with steep downtrend (bear-leg from 1.0936, Nov 5 lower top) eyeing key med-term support at 1.0601 (2024 low posted on Apr 16).

Firmly bearish daily technical studies add to euro-negative fundamentals (euphoria over expectations of Trump’s measures to strongly boost economic growth / fears of tariffs on imports from the EU), with partial profit-taking to spark limited correction.

Broken Fibo 76.4% (1.0745) to ideally cap, with extended upticks to stall under broken psychological 1.08 supported, now acting as solid resistance, to keep larger bears in play and provide better selling opportunities.

Res: 1.0682; 1.0745;1.0761; 1.0800
Sup: 1.0601; 1.0516; 1.0495; 1.0448