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Bears are taking a breather after two-week pullback (down 6.5%) from new record high found footstep at $2540 zone (contained by rising 100DMA).

Gold price bounced from new two-month low on Monday after pullback faced strong headwinds from Fibo 50% of $2293/$2790 upleg and nearby daily Ichimoku cloud base, boosted by a pause in dollar’s recent strong rally.

Fresh gains eye initial pivots at $2600/11, former strong supports, reverted to solid resistances (broken Fibo 38.2% / psychological / daily cloud base), violation of which is needed to generate initial reversal signal and shift near term focus to the upside.

Recovery after the biggest weekly loss in more than three years (gold price was down 4.5% last week, strongly deflated by signals of Fed’s less aggressive stance on interest rates cuts ) still requires more information about the US central bank’s near-term rate trajectory, to generate clearer direction signal.

Sustained break above $2600 to ease downside pressure, however, rise through next technical barriers at $2633 (Fibo 38.2% of $2790/$2536 pullback / 10DMA) and extension through $2663 (50% retracement / daily Kijun-sen) to validate signal.

Also, deteriorating geopolitical situation on US’s green light for potential missile attacks deeply into Russian territory and their subsequent response that may lead into immeasurable escalation of the war in Ukraine, could be very supportive to safe-haven gold.

Res: 2600; 2611; 2643; 2663.
Sup: 2564; 2536; 2524; 2500.

The New Zealand dollar has started the trading week with losses. In the European session, NZD/USD is trading at 0.5837, down 0.50% on the day. This is the New Zealand dollar’s lowest level since November 2023.

New Zealand Services PMI stuck in contraction mode

New Zealand Services PMI inched upwards in October but remains in contraction mode. The reading of 46.0 was higher than the September reading of 45.7 but shy of the forecast of 47.0. Services activity has contracted for eight straight months as the economy continues to sputter. The survey found that the major concerns of respondents were the cost of living and economic conditions.

The Reserve Bank of New Zealand has shown it can be aggressive as it chopped interest rates by 50 basis points in October, bringing the cash rate to 4.75%. This move was expected yet the New Zealand dollar still plunged almost 1% in response to the dramatic move. The RBNZ meets next on Nov. 27 and the markets are expecting more strong medicine in the form of another oversized 50-bp cut to stimulate the economy. This would likely put strong downward pressure on the wobbly New Zealand dollar.

US retail sales stronger than expected

The week ended on a positive note as US retail sales were better than expected in October. Monthly, retail sales rose 0.4%, better than the market estimate of 0.3% and following a September gain of 0.8% that was revised from 0.4%. Annually, retail sales posted a strong gain of 2.8%, up from an upwardly revised gain of 1% in September and blowing past the forecast of 1.9%.

The strong data for September and October has lowered the odds of a rate cut in December, which are currently around 60%. On Thursday, prior to the retail sales report, Fed Chair Powell said that “the economy is not sending any signals that we need to be in a hurry to lower rates”.

NZD/USD Technical

• There is resistance at 0.5894 and 0.5948
• 0.5809 and 0.5755 are the next support levels

Irish ECB Governing Council member Gabriel Makhlouf signaled caution today, emphasizing that an interest rate cut at the December 12 meeting is not guaranteed.

“It would be going a bit far to say an ECB interest rate cut next month is 'in the bag,'” he stated, adding that the evidence s would need to be "pretty overwhelming" for a more aggressive 50bps reduction.

Makhlouf also addressed the uncertainty surrounding the impact of US President-elect Donald Trump’s administration on inflation dynamics. He stressed that it would be "premature" to base monetary policy decisions on assumptions about Trump’s fiscal and trade policies, stating, “I do think it would be premature to come to conclusions as to exactly what it is that the new US administration is going to do.”

As the BTC/USD chart indicates:

→ At the start of November, Bitcoin’s price was around the $70,000 level.

→ Today, a single coin is trading for approximately $92,000.

On 12 November, when we last analysed Bitcoin’s price, we:

→ Highlighted factors driving bullish sentiment.

→ Identified a long-term ascending channel.

→ Predicted a potential correction after surpassing the psychological $90k level.

Now, let’s focus on the technical analysis of the hourly BTC/USD chart, which shows that:

→ Since 5 November (when confirmations of Trump’s election victory started emerging), the price has formed a steep ascending channel (marked in blue).

→ Indeed, the bulls failed to firmly establish themselves above the psychological level, resulting in a correction (marked with a red arrow) last week.

→ The lower boundary of the blue channel acted as support (indicated by the black arrow), allowing the bulls to attempt a trend recovery and achieve their first milestone—breaking a local descending trendline (marked in red).

It is possible that bullish progress will continue, potentially bringing Bitcoin closer to the significant $100,000 mark per coin.

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Eurozone goods exports rose 0.6% yoy to EUR 237.8B in September. Goods imports fell -0.6% yoy to EUR 225.3B. Trade balance reported a EUR 12.5b surplus. Intra-Eurozone trade fell -1.0% yoy to EUR 215.5B.

In seasonally adjusted term, goods exports rose 0.4% mom to EUR 237.6B. Goods imports fell -0.8% mom to EUR 224.1B. Trade balanced reported EUR 13.6B surplus, larger than expectation of EUR 7.9B. Intra-Eurozone trade fell -0.9% mom to EUR 212.9B.

Full Eurozone trade balance release here.

AUD/USD is showing signs of stabilisation near 0.6465, marking its second consecutive session of attempts to recover.

The Australian dollar finds some support from the hawkish comments made by Reserve Bank of Australia (RBA) Governor Michele Bullock. Bullock stated that interest rates are restrictive and will remain so until the RBA is fully assured of the inflation outlook.

Investors are keenly awaiting the publication of the minutes from the last RBA meeting, which is expected this week. The minutes will provide deeper insights into the RBA’s future policy actions.

Additionally, upcoming releases on November’s industrial and services sector data could further influence the Australian dollar’s trajectory.

Despite these supportive factors, AUD/USD remains near three-month lows, pressured by a strengthening US dollar. The US dollar has benefited from expectations that the Federal Reserve might opt for a more minor rate cut amid robust economic forecasts under President Donald Trump’s administration.

Technical analysis of AUD/USD

On the H4 chart of AUD/USD, the market has formed a broad consolidation range around the 0.6565 level. Currently, the market has broken through the lower boundary of this range. Today, a narrower consolidation range has developed around the 0.6464 level. It is relevant to consider the probability of a downward breakout from this range, which could lead to a further downward movement towards the 0.6333 level, with the potential for the trend to continue to 0.6233, the local target. Technically, this scenario is supported by the MACD indicator, as its signal line is below zero and pointing downwards.

On the H1 AUD/USD chart, the market continues to form a narrow consolidation range around 0.6464. In case of a downside breakout, we anticipate the second half of the downward wave continuing, targeting 0.6333. Conversely, a corrective move towards 0.6500 is possible if the market breaks upwards. The downward trend is expected to extend towards 0.6233 in the longer term. Technically, this scenario is supported by the Stochastic oscillator, with its signal line positioned below the 80 mark and pointing down towards 20.

Market Picture

The crypto market capitalisation hit a new high of $3.09 trillion on Monday morning (+1% in 24 hours), driven by altcoins. The Cryptocurrency Fear and Greed Index reached 90 over the weekend, with the index only higher in late 2020 and early 2021. By Monday, the index had fallen back to 83, still consistent with extreme greed.

The Altcoin Season Indicator has now risen from 23 on 4th November to 42, thanks to optimism around XRP and Dogecoin. Cardano is also gaining momentum.

XRP topped $1 for the first time in three years. On Saturday, the token climbed above $1.2, as it is sensitive to Gary Gensler’s possible departure. Under his leadership, Ripple has been in a constant legal battle with the SEC.

Bitcoin drifted down 3% on Saturday and Sunday, but on Monday, a 4% surge above $91,500 took it above this consolidation area. Institutional traders are activating at a time when retail traders are starting to lock in profits in Bitcoin and moving into altcoins.

Cryptocurrencies are perhaps the most notable market where retail is profiting at the expense of institutional rather than the other way around.

News Background

According to SoSoValue, net inflows into US spot Bitcoin ETFs totalled $1.67 billion last week, marking the sixth consecutive week of net inflows. Cumulative inflows since the launch of bitcoin ETFs in January rose to $27.46 billion.

Ethereum ETFs saw net inflows of $515.2 million last week, a record high since the funds were approved on 23rd July, which brings the total net inflows since the product launch to $178.4 million.

The distribution of implied volatility in the Bitcoin options market suggests a high probability of trading at lower levels. “The deleveraging risk could be significant,” Blofin warned.

A bill to create a Bitcoin reserve is up for a vote in the US Congress. It involves purchasing 1 million BTC (up to 200,000 BTC per year for five years). The Fed’s gold reserves will be used for this purpose. Speculation on this issue could be an important driver of Bitcoin’s rise against gold.

Solidion Technology, a manufacturer of electric batteries and components, announced that it will convert some of its cash reserves into bitcoin. The company plans to use 60% of its excess cash, all of its money market interest income and some of its future capital raising to buy the first cryptocurrency.

• NZDUSD has been trading sideways for more than a year
• Bears try to push below the key support of 0.5855
• RSI and MACD detect bearish momentum
• For the outlook to brighten, a move above 0.6220 may be needed

NZDUSD has been falling since September 30, when it hit resistance near the 0.6370 zone, which stopped the bulls back in December 2023 as well. Overall, though, most of the price action had been contained between the 0.5855 and 0.6220 zones since July 2023, suggesting a neutral broader outlook.

That said, today, the bears seem willing to push the battle below the 0.5855 territory, a move that may pave the way towards the low of October 26, 2023, at around 0.5770. If they are not willing to surrender there, they may then decide to dive all the way down to the 0.5600 barrier, marked by the low of October 21, 2022.

Both the RSI and the MACD detect negative momentum. The former is lying near its 30 line, while the latter has been running below both its zero and trigger lines since last Tuesday. Nonetheless, the RSI has been repeatedly respecting its 30 line as support, which raises the likelihood for a potential rebound before the next leg south.

If the recovery extends above 0.6035 though, this may be a sign that traders do not want to exit the range yet. The bulls may gain enough confidence to target the 0.6120 zone, the break of which could carry extensions towards the upper end of the aforementioned range at 0.6220. That said, for the picture to become brighter, a break higher may be needed.

To sum up, NZDUSD has been trading in a trendless mode for more than a year, but the bears are now attempting to break lower. It will be interesting to see whether a move below 0.5855 will lead to larger declines.

• Gold makes recovery attempt after aggressive sell-off
• Technical signals welcome a bullish pivot but there is a wall at 2,600

Gold bounced up on Monday with scope to test the 2,600 round level after its two-week freefall paused near the constraining zone of 2,545.

The precious metal has retraced half of its record rally from June to October and signs of an oversold market are beginning to emerge, with the RSI and the stochastic oscillator currently looking for a pivot near 30 and 20 respectively.

However, for the bulls to encourage fresh buying they must first re-enter the broad bullish channel above 2,600, where the 38.2% Fibonacci mark is also placed. If their efforts prove successful, they could send the price toward the 50-day simple moving average (SMA) and the 23.6% Fibonacci of 2,672, while higher, they may attempt to cross the 2,750 border if the 2,700 area gives way.

In the bearish scenario, where the floor at 2,545 cracks, support could next come somewhere between the 61.8% Fibonacci of 2,483 and the restrictive line at 2,445. Failure to rotate there could see gold sinking toward the 200-day SMA for the first time in a year.

Overall, if the Elliot wave theory is still in play, the price might have entered a temporary corrective phase after completing its five bullish sub-waves (i-v).

Summing up, gold is currently displaying positive momentum, though to convince new buyers to enter the market in the short-term, it must first establish a strong foothold above 2,600. Until then the market may remain in a holding pattern. 

GBP/USD started a fresh decline below the 1.2750 zone. USD/CAD is rising and might aim for more gains above the 1.4100 resistance.

Important Takeaways for GBP/USD and USD/CAD Analysis Today

• The British Pound started a major decline from the 1.3000 resistance zone.
• There is a key bearish trend line forming with resistance at 1.2650 on the hourly chart of GBP/USD at FXOpen.
• USD/CAD is showing positive signs above the 1.4000 support zone.
• There is a connecting bullish trend line forming with support at 1.4040 on the hourly chart at FXOpen.

GBP/USD Technical Analysis

On the hourly chart of GBP/USD at FXOpen, the pair struggled to continue higher above the 1.3000 resistance zone. The British Pound started a downside correction and traded below the 1.2850 support zone against the US Dollar.

The pair even traded below 1.2700 and the 50-hour simple moving average. Finally, the bulls appeared near the 1.2600 level. A low was formed at 1.2597 and the pair is now consolidating losses.

The pair is now consolidating losses below the 23.6% Fib retracement level of the downward move from the 1.3009 swing high to the 1.2597 low. Immediate resistance on the upside is near a key bearish trend line at 1.2650.

The first major resistance is near the 1.2695 zone. The main hurdle sits at 1.2800 and the 50% Fib retracement level of the downward move from the 1.3009 swing high to the 1.2597 low.

A close above the 1.2800 resistance might spark a steady upward move. The next major resistance is near the 1.2880 zone. Any more gains could lead the pair toward the 1.3000 resistance in the near term.

Initial support on the GBP/USD chart sits at 1.2600. The next major support sits at 1.2550, below which there is a risk of another sharp decline. In the stated case, the pair could drop toward 1.2420.

USD/CAD Technical Analysis

On the hourly chart of USD/CAD at FXOpen, the pair formed a strong support base above the 1.3840 level. The US Dollar started a fresh increase above the 1.3930 resistance against the Canadian Dollar.

The bulls pushed the pair above the 1.3980 and 1.4000 levels. The pair cleared the 50-hour simple moving average and climbed above 1.4040. A high was formed at 1.4105 and the pair recently corrected some gains.

There was a move toward the 23.6% Fib retracement level of the upward move from the 1.3930 swing low to the 1.4105 high. Initial support is near the 1.4065 level.

The next major support is near a major bullish trend line at 1.4040. The main support sits near the 1.4000 zone on the same USD/CAD chart. It is close to the 61.8% Fib retracement level of the upward move from the 1.3930 swing low to the 1.4105 high.

A downside break below the 1.4000 level could push the pair further lower. The next major support is near the 1.3930 support zone, below which the pair might visit 1.3840.

If there is another increase, the pair might face resistance near the 1.4105 level. A clear upside break above 1.4105 could start another steady increase. The next major resistance is the 1.4150 level.

A close above the 1.4150 level might send the pair toward the 1.4200 level. Any more gains could open the doors for a test of the 1.4280 level.

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This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.