Weekly Technical Outlook – WTI, USDJPY, EURUSD
OPEC+ meeting expected to cut production; WTI crude oil remains in the red
US Core PCE index to soften; USDJPY fails to climb higher
Eurozone flash inflation to tick lower; EURUSD holds near previous 3-month high
The OPEC meeting was scheduled for November 26th but has been postponed to this Thursday. This suggests deepening alliance disagreements over whether to curtail production, according to investors. Saudi Arabia, which wants to keep prices from falling, will likely reach a deal. However, even if that is the true and OPEC+ provides a plan to tighten supply over the coming months, Saudi Arabia will probably not get as much reduction as it wanted. Any additional cuts beyond those announced on Thursday are likely off the agenda.
Technically, WTI crude oil futures confirmed a bearish bias in the short-term after the rejection of jumping above the negative cross within the 20- and the 200-day simple moving averages (SMAs). More losses could drive the market towards the 72.30 support before meeting the lower boundary of the descending channel near 68.20. However, any jumps above the 200-day SMA could send the price towards the 80.00 round number.US Core PCE index --> USDJPY
The upcoming focal point will be the US dataset scheduled on Thursday, encompassing personal income and expenditure, alongside the core PCE price index. It is anticipated that both personal income and consumption experienced moderation in October. The core PCE inflation measure, which holds significant importance, is expected to have decelerated from 3.7% to 3.5% y/y in the month of October.
In FX markets, USDJPY has been stubbornly pushing for some recovery without success lately. The pair is still developing beneath the near-term SMAs, holding near the 149.00 area. In case of more declines, they could open the way for a test of the 147.10 and 145.80 barriers. Only a fall beneath the 200-day SMA at 141.85 could endorse the negative structure. On the other hand, a jump above the 13-month high of 151.90 could brighten the bullish outlook again.Eurozone flash CPI --> EURUSD
The preliminary measurements of inflation for November for the Eurozone will also be released on Thursday. It is anticipated that the Harmonized Index of Consumer Prices (HICP) will drop from 2.9% to 2.8% in November, marking the lowest level in almost two years. It is anticipated that the core measure, which excludes all volatile items, will come in at 4.0%, down from 4.2% in October.EURUSD is failing to surpass the more-than-three-month high of 1.0965. A climb above this region could be a big achievement in the short-term timeframe, sending prices to the 1.1065 and 1.1150 resistance levels. Alternatively, a drop lower could challenge the 1.0850 support before resting near the 200-day SMA at 1.0810.
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.