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Wow, the month started very strongly, with Bank of Japan (BoJ) head Ueda hinting yesterday that the BoJ could deliver a rate hike next month — and boom, all hell broke loose. Japanese yields spiked to fresh multi-decade highs, pulling other sovereign yields up, while equities and Bitcoin tanked and gold and silver spiked. Reports suggest around $1bn of leveraged crypto positions were wiped out yesterday. It was bad. Really bad.

Today, the mood is much better after the 10-year JGB auction went well and saw strong demand — helping to stabilize Japanese JGBs and other sovereigns. The US 10-year steadies near the 4% mark, and the USDJPY is recovering yesterday’s heavy slump.

Even though the Nikkei remains under pressure, Bitcoin and tech-heavy pockets of Asian markets have rebounded. The Kospi is up 1.61% at the time of writing, while Bitcoin is up less than 1% — very small by its standards. The coin tested a key support level yesterday: the 38.2% Fibonacci retracement around $83K. If broken, it could push Bitcoin into a medium-term bearish consolidation zone.

What’s the downside? Mining costs are said to be around $70K, which could act as a floor as commodities don’t trade below their production costs. But Bitcoin is not a typical commodity. You don’t use it to build houses, cars or solar panels. That supply-only perspective ignores demand. If investors fear a decline, will demand remain strong? Bitcoin has limited real-world usage and mostly serves as a store of value.

The recent wipeout could deepen, leaving less money for traditional investments, while rising Japanese yields and the potential repatriation of billions of dollars back to Japan add further risks for risk assets.

Let’s see if Federal Reserve (Fed) doves return to charge. Yesterday’s US data highlighted economic weakness beyond AI hype: factory activity contracted for the ninth straight month, orders fell at the steepest pace in four months and employment shrank. Judging by the data and Fed funds futures, a rate cut next week seems highly likely; otherwise, the market reaction would be severe.

The hope is that the slowing US economy also slows spending and tames inflation. Black Friday sales hit a record, and Cyber Monday was robust, but part of that was due to inflation — Americans bought 1% fewer goods but paid 7% more, according to Salesforce. Tariffs will likely continue adding pressure. Companies have weathered costs by liquidating pre-tariff stockpiles, while others absorbed temporary hits. But ultimately, someone pays. If demand weakens, tariff-led price increases could be neutralized.

So it comes down to this: will tariff-driven price pressure, combined with a softening jobs market, eventually force consumers to pull back? And could any slowdown offset the inflationary impact of tariffs? US inflation cannot rise materially above 3% without affecting Fed cut expectations. We are in a delicate place for policy: a rate cut next week may not bring relief if inflation data doesn’t improve.

The US dollar remains under pressure, below the 200-DMA. Other traditional currencies, like the euro and sterling, look unattractive amid high debt, budget issues and weak growth. Gold, silver and copper have spiked as investors seek hard commodities — seemingly a safer store of value than Bitcoin — which also hedge against inflation, unlike Bitcoin, which has too short a track record.

Meanwhile, in technology, it’s business as usual. Nvidia announced yesterday a $2bn investment in Synopsys, which makes the software and building blocks used to design computer chips — and incidentally, is also a Nvidia client. OpenAI is investing in the startup vehicle Thrive Holdings. Time will tell whether these companies are building a genuine AI ecosystem or a house of cards. Nvidia rose 1.65% in an otherwise ugly session, suggesting investors can digest anything — wars, exploding debt, tariffs — and circular AI deals.

In focus today

In the euro area, focus turns to the flash inflation data for November. On Friday we received data from the biggest four countries, which came in lower than expected pointing to unchanged headline inflation at 2.1% y/y and core at 2.4% y/y in November in line with our initial forecast but below consensus expectations.

In Denmark, Danmarks Nationalbank's press release on November FX reserve will be published today, revealing whether the central bank intervened in the FX market in November. The EUR/DKK is at a high level, but we do not expect the release to show intervention in November.

Economic and market news

What happened yesterday

In the US, the ISM manufacturing index fell to 48.2 in November (cons: 49.0) from 48.7 in October, signalling continued contraction in the sector. While realised output improved, forward-looking order-inventory balances weakened significantly, pointing to negative growth momentum. Domestic demand showed further signs of softening, while export orders recovered slightly but remain at historically low levels. With key US labour market and inflation data postponed beyond the Fed's next meeting on 10 December, the weaker-than-expected ISM manufacturing release reinforces expectations for a dovish stance from the Fed, and markets are now pricing in a 86% probability for a December cut. We are also expecting a 25bp cut in December.

In Sweden, the manufacturing PMI fell to 54.6 in November (prior: 55.0) but is still above its historical average of 54.3 for the fifth consecutive month. The decline was mainly driven by a decline in production but also delivery times, while new orders and employment increased. We are not worried about the decline in November. The PMI is holding up well, and this view is also supported by the NIER survey from last week.

In Norway, the manufacturing PMI rose from 48.2 to 53.0 in November, breaking the downward trend we have seen since July. The recovery was broad-based, with gains in production, new orders and employment. As we have previously noted, the PMI has been significantly weaker than actual production figures for some time, and the lift in November just helps close this gap somewhat.

On tariffs, the US announced a zero-tariff pharmaceutical deal with the UK. The agreement will see UK pay 25% more for new US medicines and revise its drug valuation framework at NICE. In return, UK-made medicines and medical technology will be exempt from US tariffs. Bristol Myers Squibb plans USD 500m in UK investments, while the British Chambers of Commerce praised the deal.

Bitcoin dropped 5.2% on Monday, which dragged its price down to USD 87,000, marking a 30% drop since its October high.

In geopolitics, efforts to end the Ukraine war are gaining momentum as US Special Envoy Witkoff and Jared Kushner head to Moscow for talks with Russian President Putin. European leaders, including President Zelenskiy, have pushed back against initial US peace proposals seen as favouring Russia, advocating for a more balanced framework during recent discussions in Geneva and Paris.

Equities: The week opened with lower equity markets, but the tone was anything but classic risk-off. Cyclicals outperformed defensives, and low-vol stocks lagged the broader market. Sector-wise, Utilities were among the weakest performers, while Consumer Discretionary posted gains. The more telling price action unfolded in rates, where yields moved higher across the curve and across regions. It started with repricing at the front end in Japan yesterday morning and ended with a notable long-end increase in the US last night.

The equity moves should thus also be viewed through the lens of the global rates repricing and a market that is now entering a "wait-and-see" mode ahead of a heavy catch-up in delayed US macro data over the coming days. Asian markets are mostly higher this morning, led by strong gains in South Korea. Equity futures in Europe and the US trade broadly unchanged relative to yesterday's close.

FI and FX: Fixed income markets were off to a tough start to the week with a bearish steepening of the curve across regions. In the US, 10Y Treasuries rose close to 10bp while the 10Y swap rate climbed roughly 7bp during the day. JPY continued its performance during yesterday's session following BoJ Governor Ueda signalling a possibility of a rate hike at the December policy meeting, citing improving economic conditions and sustained wage growth as key factors. EUR/USD rose throughout yesterday's session, trading above the 1.16 mark aided by weak ISM data, cementing a rate cut from the Fed in December. The European natural gas price has dropped to the lowest level since early 2024 and the spread to US natural gas prices has narrowed to the tightest level since 2021.

Daily Pivots: (S1) 1.3968; (P) 1.3985; (R1) 1.4015; More...

USD/CAD recovered ahead of near term channel support and intraday bias is turned neutral first. Some consolidations could be seen above 1.3936 temporary low. But risk will stay mildly on the downside as long as 55 4H EMA(now at 1.4033) holds. Below 1.3936 will target 38.2% retracement of 1.3538 to 1.4139 at 1.3909. Sustained break there will indicate that whole rise from 1.3538 has completed. Deeper fall should then be seen to 61.8% retracement at 1.3768 next. However, fir break of 55 4H EMA will retain near term bullishness, and bring retest of 1.4139 high.

In the bigger picture, price actions from 1.4791 medium term top is likely just unfolding as a correction to up trend from 1.2005 (2021 low), with rise from 1.3538 as the second leg. A third leg should follow before up trend resumption. That is, range trading is set to extend for the medium term. For now, this will remain the favored case as long as 1.3886 support holds. However, firm break of 1.3886 will revive the case that fall from 1.4791 is indeed a larger scale correction.

Market sentiment steadied across Asia today, with most assets drifting in tight ranges after Monday’s volatility. The overnight selloff in the US was modest, and fears that Japan-led risk aversion would spill aggressively into global markets did not materialize. While pockets of unease lingered—particularly in the tech space following Bitcoin’s slump—the broader tone has remained controlled.

Bitcoin extended its weak run from November and posted its worst day since March on Monday, weighing on tech-linked sentiment. Even so, the fallout has been mostly contained, with investors showing little sign of broad defensive repositioning. The stabilization in equity futures and credit markets helped underpin the more measured tone in Asian trading.

In Japan, super-long-dated yields eased after briefly touching fresh highs, providing relief after a turbulent start to the week. A successful 10-year JGB auction generated the strongest demand since September, offering reassurance to investors who had grown nervous about the pace of reflation in Japanese rates markets. The result helped reverse part of yesterday’s spike in yields.

The move comes as markets continue to digest rising expectations for a BoJ rate hike at the December meeting. Governor Kazuo Ueda’s comments earlier this week triggered a sharp repricing of rate expectations, but today’s pullback in yields and the solid auction helped calm nerves. Swaps still assign around a 70% probability to a 25bps move this month, keeping policy normalization firmly in focus.

Optimism from South Korea added to the region’s stability. Shares of major auto manufacturers rose after US Commerce Secretary Howard Lutnick confirmed that the newly negotiated 15% US auto tariff rate for South Korea would apply retroactively from November 1. The announcement boosted confidence that bilateral trade conditions are improving for Korean exporters.

In the currency markets, Yen remains the strongest performer of the week, supported by rising BoJ expectations, followed by Euro and Dollar. On the weaker side, Sterling leads the laggards, with Loonie and Swiss Franc also soft. Aussie and Kiwi sit in the middle of the pack as cross-flows dominate.

Most major pairs and crosses have drifted back inside last week’s ranges, reinforcing the view that markets have stabilized after Monday’s volatility. With no major catalysts in the Asian session, traders appear content to consolidate positions ahead of upcoming US data later in the week.

In Asia, Nikkei fell -0.05%. Hong Kong HSI is down -0.04%. China Shanghai SSE is down -0.45%. Japan 10-year JGB yield fell -0.019 to 1.860. Overnight, DOW fell -0.90%. S&P 500 fell -0.53%. NASDAQ fell -0.38%. 10-year yield rose 0.079 to 4.096. Overnight, DOW fell -0.90%. S&P 500 fell -0.53%. NASDAQ fell -0.38%. 10-year yield rose 0.079 to 4.096.

RBNZ's Breman sets tone for Leadership: Mandate discipline and public trust

New RBNZ Governor Anna Breman used her first appearance before a parliamentary committee to underline a back-to-basics approach for the central bank. She said her leadership will be “laser focused” on the core mandate of keeping inflation low and stable, ensuring financial system resilience, and maintaining a safe and efficient payments framework.

Her comments signal an intention to anchor policy discussions firmly around credibility and discipline after a period of volatility in inflation and rate expectations. By highlighting the fundamentals of price stability and financial stability, Breman appears set to build continuity with the bank’s existing stance while strengthening its emphasis on execution and institutional reliability.

Looking into 2026, Breman said "transparency, accountability, and clear communication" will be central pillars of her leadership. She noted that maintaining public trust is critical for the next phase of policy.

Bitcoin under pressure as rebound fades; correction targets 70k psychological level

Bitcoin’s sharp selloff this week indicates that the latest rebound has possibly already run its course, suggesting that medium-term correction is entering another downward phase. The move follows a difficult November, when Bitcoin posted its largest monthly decline since mid-2021 as a record volume of capital exited the market. Momentum remains soft, and technical structure points to further pressure ahead.

Sentiment deteriorated further on Monday after Strategy — the largest corporate holder of Bitcoin — cut its earnings outlook for 2025, citing Bitcoin’s weak performance. More broadly, Bitcoin appears to be suffering from fading enthusiasm within both the digital-asset community and the wider tech sector, where concerns about market concentration, infrastructure constraints, and slowing global cooperation are resurfacing.

Technically, the near-term rebound from 80,492 looks to have topped at 93,074. Retest of 80,492 is now the immediate focus, and firm break would resume the entire decline from 126,289. In any case, outlook will stays firmly bearish as long as 55 D EMA (now at 99,564) holds.

In the bigger picture, Bitcoin is clearly correcting the full five-wave uptrend from the 15,452 (2022 low). While further decline is expected, the 70,000 psychological region is expected to provide strong initial support for an interim base. That aligns with several structural levels: 74,373 support, 73,812 former resistance-turned-support, and 50% retracement of 15,452 to 126,289 at 70,870. This cluster reinforces the area’s importance in defining the medium-term floor.

Meanwhile sustained break back above the 55 W EMA (now at 97,447), would indicate that the medium-term correction from 126,289 has already shifted into a second leg, opening the door for a more sustained rebound. Until then, price risks remain skewed to the downside as the market digests weakening sentiment and tightening technical conditions.

USD/CAD Daily Outlook

Daily Pivots: (S1) 1.3968; (P) 1.3985; (R1) 1.4015; More...

USD/CAD recovered ahead of near term channel support and intraday bias is turned neutral first. Some consolidations could be seen above 1.3936 temporary low. But risk will stay mildly on the downside as long as 55 4H EMA(now at 1.4033) holds. Below 1.3936 will target 38.2% retracement of 1.3538 to 1.4139 at 1.3909. Sustained break there will indicate that whole rise from 1.3538 has completed. Deeper fall should then be seen to 61.8% retracement at 1.3768 next. However, fir break of 55 4H EMA will retain near term bullishness, and bring retest of 1.4139 high.

In the bigger picture, price actions from 1.4791 medium term top is likely just unfolding as a correction to up trend from 1.2005 (2021 low), with rise from 1.3538 as the second leg. A third leg should follow before up trend resumption. That is, range trading is set to extend for the medium term. For now, this will remain the favored case as long as 1.3886 support holds. However, firm break of 1.3886 will revive the case that fall from 1.4791 is indeed a larger scale correction.

Bitcoin’s sharp selloff this week indicates that the latest rebound has possibly already run its course, suggesting that medium-term correction is entering another downward phase. The move follows a difficult November, when Bitcoin posted its largest monthly decline since mid-2021 as a record volume of capital exited the market. Momentum remains soft, and technical structure points to further pressure ahead.

Sentiment deteriorated further on Monday after Strategy — the largest corporate holder of Bitcoin — cut its earnings outlook for 2025, citing Bitcoin’s weak performance. More broadly, Bitcoin appears to be suffering from fading enthusiasm within both the digital-asset community and the wider tech sector, where concerns about market concentration, infrastructure constraints, and slowing global cooperation are resurfacing.

Technically, the near-term rebound from 80,492 looks to have topped at 93,074. Retest of 80,492 is now the immediate focus, and firm break would resume the entire decline from 126,289. In any case, outlook will stays firmly bearish as long as 55 D EMA (now at 99,564) holds.

In the bigger picture, Bitcoin is clearly correcting the full five-wave uptrend from the 15,452 (2022 low). While further decline is expected, the 70,000 psychological region is expected to provide strong initial support for an interim base. That aligns with several structural levels: 74,373 support, 73,812 former resistance-turned-support, and 50% retracement of 15,452 to 126,289 at 70,870. This cluster reinforces the area’s importance in defining the medium-term floor.

Meanwhile sustained break back above the 55 W EMA (now at 97,447), would indicate that the medium-term correction from 126,289 has already shifted into a second leg, opening the door for a more sustained rebound. Until then, price risks remain skewed to the downside as the market digests weakening sentiment and tightening technical conditions.

New RBNZ Governor Anna Breman used her first appearance before a parliamentary committee to underline a back-to-basics approach for the central bank. She said her leadership will be “laser focused” on the core mandate of keeping inflation low and stable, ensuring financial system resilience, and maintaining a safe and efficient payments framework.

Her comments signal an intention to anchor policy discussions firmly around credibility and discipline after a period of volatility in inflation and rate expectations. By highlighting the fundamentals of price stability and financial stability, Breman appears set to build continuity with the bank’s existing stance while strengthening its emphasis on execution and institutional reliability.

Looking into 2026, Breman said "transparency, accountability, and clear communication" will be central pillars of her leadership. She noted that maintaining public trust is critical for the next phase of policy.

Gold (XAUUSD) continues to exhibit a bullish sequence from the 28 October low, suggesting further upside potential. The rally from that low is unfolding as a five‑wave impulse, with wave 1 concluding at 4245.22, as reflected in the one‑hour chart. Following this, wave 2 developed into a zigzag Elliott Wave structure. From the peak of wave 1, wave ((a)) ended at 4144.97, while the subsequent rally in wave ((b)) terminated at 4211.31. The decline in wave ((c)) reached 3996.25, thereby completing wave 2 at a higher degree.

The metal has since resumed its upward trajectory in wave 3, decisively breaking above the prior wave 1 peak. This confirms that the next leg higher has commenced. From the conclusion of wave 2, wave ((i)) ended at 4132.81. The corrective pullback in wave ((ii)) finished at 4022.07, forming a double three structure. One more leg higher is anticipated to complete wave ((iii)), after which a modest pullback in wave ((iv)) should occur. The market is then expected to advance again in wave ((v)), thereby concluding wave 3.

The potential target for this advance lies within the 100% to 161.8% Fibonacci extension of wave 1, calculated at 4358–4579. In the near term, as long as the pivot at 3996.25 remains intact, any pullback should find support within a sequence of 3, 7, or 11 swings, paving the way for continued strength. This structure reinforces the bullish outlook and highlights the importance of maintaining the key pivot level to sustain momentum.

Gold (XAUUSD) 60-Minute Elliott Wave Chart From 12.2.2025

XAUUSD Elliott Wave Video:

https://www.youtube.com/watch?v=pFFi74eIJ-M

Key Highlights

• Ethereum struggled to recover above $3,050 and trimmed gains.
• ETH is well below a key bearish trend line with resistance at $3,260 on the daily chart.
• Bitcoin price gained bearish momentum and settled below $90,000.
• XRP started a fresh decline after it struggled near $2.25 and $2.28.

Ethereum Technical Analysis

Ethereum started a recovery wave from $2,620. The bulls were able to push ETH above $2,800 and $3,000 before they faced hurdles.

Looking at the daily chart, the price remained well below the 100-day simple moving average (red). The bears defended the $3,050 resistance zone and the price even failed to test the 50% Fib retracement level of the downward move from the $3,655 swing high to the $2,616 low.

ETH is now well below a key bearish trend line with resistance at $3,260. The current price action suggests an increase in bearish pressure. If there is a recovery wave, the price could face resistance at $3,000.

The next major resistance is near the $3,050 level. The main resistance is now forming near the $3,250 zone and the trend line. A daily close above the $3,250 resistance zone could start another steady increase. In the stated case, the price may perhaps rise toward the $3,500 level.

On the downside, the bulls might be active near $2,680 and $2,640. The main support is now forming near $2,500, below which the price could slide toward $2,350. Any more losses might call for a move toward $2,200.

Looking at Bitcoin, there was a sharp decline below $88,000, and the bears seem to be aiming for more downside in the near term.

Economic Releases

• FPC Meeting Minutes.
• Fed's Bowman speech.

Platinum: ⬇️ Sell

• Platinum reversed from strong resistance zone
• Likely to fall to support level 1600.00

Platinum recently reversed down from the strong resistance zone located between the resistance level 1722.00 (which stopped the pervious impulse wave 1), resistance level 1700.00 and the upper daily Bollinger Band.

The downward reversal from this resistance zone is likely to form the daily Japanese candlesticks reversal pattern Shooting Star – if the price closes today near the current levels.

Given the bearish divergence on the daily RSI indicator, Platinum can be expected to fall to the next round support level 1600.00.

Catalysts for movements in the US Dollar have been confusing all types of Market Participants.

Reaching new cycle highs during the longest ever US Government shutdown (43 days), the Greenback consequently fell as the government reopened, driven by dovish hopes for the December 10 FOMC meeting.

Current yo-yos in the dollar are leaving traders in question.

All of this comes after a massive downtrend throughout the first half of the year due to tariffs and unpredictable policies from Donald Trump, requiring dollar-diversification from many economic and political parties around the world.

Dollar funding is also not at its best levels, with Reverse Repo (RRP) facilities (Bank Reserves at the Fed) at the lowest levels in years, a liquidity drain that is provoking significantly more volatile movements in the USD.

The pricing for the FOMC meeting, the last one of the year occurring in 10 days, peaked Friday very close to 90% and has now backed down to 85% amidst a lack of fresh data to influence pricing. Friday's Core PCE report may affect the entire pricing.

Rate Cut Pricing for the December 10 FOMC Meeting, December 1, 2025 – Source: CMEGroup

At its session lows, the Dollar Index was down almost 1.50% from its past week highs but has been subject to a V-shape rebound today.

The latest story? The White House could be preparing for a defeat regarding tariffs—potentially linked to recent court challenges blocking IEEPA-based levies—bringing natural mean-reversion flows to the dollar after quite a brutal weekly open.

Let's dive into Dollar Index charts as the USD makes its way back to being the second best performer of the FX session to start December.

Dollar Index (DXY) Multi-timeframe Outlook

Daily Chart

Dollar Index (DXY) Daily Chart, December 1 2025 – Source: TradingView

The US Dollar has seen some violent up and down swings in November after a flawless ascent.

After forming a bottom at the September FOMC (highlighted in a preceding USD analysis), the Greenback gained back a lot of traction and peaked at 100.376 on November 20.

Having double topped at this point but also double bottomed after today's rebound, confusing reversals point towards a large trading range between 99.00 and 100.00.

Some banks are expressing concerns regarding the low levels of Reserves and with the confusion regarding the future path of Fed Cuts, a much lower correction is being prevented.

Individual currencies are also subject to their own dynamics like the Yen (JPY) retaking some ground after BoJ Governor Ueda's comments, in between much else.

To spot how sharp the reversals are, let's take a closer look to intraday timeframes.

4H Chart and Technical Levels

Dollar Index (DXY) 4H Chart, December 1 2025 – Source: TradingView

You can spot further details on the V-shaped action in the US Dollar today which also corresponded to a test of oversold RSI levels.

The more rangebound a price action will be, the more it will respond to extreme conditions in RSI or other momentum indicators.

The recent low rebound points to immediate USD strength but it will face some hurdles which we will see on the 1H timeframe.

Levels to place on your DXY charts:

Resistance Levels

• 100.00 to 100.50 Main resistance zone
• 100.376 November highs
• 99.80 mini-resistance
• 99.40 to 99.50 Key Pivot (Immediate Test)

Support Levels

• Higher timeframe Pivot 98.80 to 99.00 (Daily Rebound and range lows)
• Past week lows and double bottom 99.03
• Mini-support 98.50 and 200-Day MA
• Main support 98.00

1H Chart

Dollar Index (DXY) 1H Chart, December 1 2025 – Source: TradingView

The Dollar Index is forming an hourly descending Channel which served as support for the Daily rebound.

Now testing the Key Pivot (99.40 to 99.50), it will be interesting to see if the reversal higher extends to confirm the Range – Keep an eye on the 50-Hour MA (at 99.47)

For this, dollar bulls will also have to break out of the hourly channel.

If they do, the range is confirmed. Rejecting the highs of the channel would on the other hand maintain the downward momentum.

It will be interesting to keep an eye on changes to the pricing for the FOMC meeting.

Safe Trades!