North American News
US stocks close mixed. Dow rises, S&P unchanged. NASDAQ falls
- Mix close for the major indices on Friday
The major US stock indices are closing the session with mixed results today:
- Dow industrial average rose 152.95 points or 0.45% at 34347.04
- S&P index fell -1.16 points or -0.03% at 4026.11
- NASDAQ index fell -58.97 points or -0.52% at 11226.35
- Russell 2000 rose 5.67 points or 0.30% at 1869.19
For the trading week, the major indices are higher:
- Dow industrial average rose 1.78%
- S&P index rose 1.53%
- NASDAQ index rose 0.72%
- Russell 2000 rose 1.05%
Commodities
Gold to struggle amid prospects of more tightening – ANZ
Recent weakness in the USD saw Gold price testing $1,780. But the Federal Reserve’s commitment to bringing inflation down with tighter monetary policy leaves room for gains in the greenback, strategists at ANZ Bank report.
Fed to hike another 100 bps
“Softer than expected inflation in the US triggered a sell-off in the US Dollar, pushing Gold higher. Nevertheless, inflation remains well above the central bank’s target range of 2%. This leaves room for more tightening until inflation slows considerably.”
“US benchmark yields are rising and likely to move higher given the view of another 100 bps rate hike by the Fed. Investment demand is stabilising, with slowing ETF outflows and covering of short positions.”
“Physical demand for Gold is weakening, though central bank purchases remain strong.”
Silver Price Analysis: XAG/USD limited while under $21.50, upside bias above $20.85
- Silver falls modestly on Friday, holds above key support levels.
- Technical outlook presents a bullish bias but upside seems limited while under $21.50.
- Break under $20.85 likely to increase bearish pressure.
Silver is falling on the last day of the week. It bottomed during the American session at $21.14 and then quickly bounced back above $21.30, as the correction from the one-week top around $21.70 faded. It is headed toward a weekly gain of 2%.
From a technical perspective, the XAG/USD, has managed to remains above the 210-day Simple Moving Average (SMA) that stands at 20.90. The chart appears to favor the upside at the moment. The area around $20.85/20.90 has become a critical support for that bullish perspective to hold.
A decline below $20.85 could trigger more losses exposing the mid-November intraday low at $20.56. Below the next target is seen at $20.25. Attention then is set on the $19.95/20.00 barrier.
A convincing breakout above $21.50 should open the doors to more gains. The next resistance area is in the $21.65/70 region followed by the $22.00 mark. The five-month high awaits at $22.26.
The XAG/USD is about to post a weekly gain of 2% and technical indicators favor the upside. Price is facing resistance at the 55-week SMA at $21.90. A weekly close above might clear the way to the 100-week SMA at $23.45.
WTI extends losses below $80.00 on buoyant US Dollar, China’s Covid woes
- China’s coronavirus crisis weighs on WTI price, on speculations of lower demand.
- The Eurozone threatening to impose a cap on Rusian and a buoyant US Dollar keeps WTI defensive.
- WTI Price Analysis: A daily close below $80.00 could pave the way for a YTD low re-test.
Western Texas Intermediate (WTI), the US crude oil benchmark, remains moderately negative due to low demand concerns surrounding the crude oil market. Factors like ongoing China’s Covid-19 outbreak and reports emerging during the week for increased crude output keep the WTI price stable. At the time of writing, WTI exchanges hands around $77.46 PB
Investors’ sentiment is mixed, in part spurred by thin liquidity conditions amid a shortened week due to the US Thanksgiving holiday. Additionally, China’s registering high number of Covid-19 cases would dent demand for the black gold, weighed on WTI price.
Newswires reported that cases peaked around 31,987 on Thursday, up from Wednesday’s 29,754. At the beginning of the week, Chinese authorities revealed measures to relax Covid-19, aiming to be less restrictive. Still, officials in some cities are again reimposing stricter measures and ordering lockdowns as they scramble to suppress the virus.
Aside from this, reports that the European Union continues its discussions to impose a price cap to Russian oil, between $65 to $70 per barrel, depressed oil prices.
Additionally, the US Dollar (USD) appreciated Friday as some short covering speculation surrounded the market. The US Dollar Index (DXY), a gauge of the greenback’s value against a basket of six peers, climbs 0.36%, up at 106.000.
WTI Price Analysis: Technical outlook
After reaching a weekly high of $82.35 PB on Tuesday, WTI prolonged its losses throughout the week. Of note, WTI falling below $80.00 PB opened the door for further downside and might test the November 21 low of $75.30 if some fundamental reasons increased uncertainty about oil demand. Notably, the Relative Strength Index (RSI) continues to fall further, meaning that sellers are gathering momentum.
Therefore, WTI’s path of least resistance is downwards. WTI’s first support would be $77.00. Break below will expose the November 21 low of $75.30, which, once cleared, could send the WTI price tumbling toward its YTD low of $74.30.
EU News
Major European indices in the day with modest gains
- For the week gains are seen across the board as well
The major European stock indices are closing the day modestly higher
- German Dax +0.01%
- Frances CAC +0.08%
- UK’s FTSE 100 +0.27%
- Spain’s Ibex +0.34%
- Italy’s FTSE MIB bucked the trend with a -0.05% decline
for the trading week:
- German Dax, +0.76%
- Frances CAC, +1.02%
- UK’s FTSE 100, +1.37%
- Spain’s Ibex, +3.55%
- Italy’s FTSE MIB +0.14%
Other News
German yield curve in deepest inversion in three decades as recession fears grow
- Germany’s bond yields curve is seeing its deepest inversion since 1992
The gap between the 2-year and 10-year German bund yields fell to -27 bps yesterday, which was the widest inversion since October 1992. That gap has narrowed slightly now to -24 bps but long story short, an inversion of the yield curve as such is typically a signal that recession fears are building.
As we look towards next year, soaring inflation pressures and the ongoing energy crunch will continue to put the pressure on the European outlook. The only consolation so far is that the start of winter has presented with milder weather than anticipated.
Cryptocurrency News
Ethereum Price Prediction: ETH bulls pause bear market rally to $1,400 on account of Thanksgiving
- Ethereum price shows a slowdown in momentum as it approaches the $1,187 resistance level.
- A successful flip of this hurdle is necessary for market makers to collect liquidity resting above the $1,290 and $1,350 levels.
- If ETH produces a daily candlestick close below the $1,067 support level, it will invalidate the bullish thesis.
Ethereum price has stopped in its tracks as it approaches a critical hurdle. The drop in momentum can be attributed to Bitcoin’s slump in buying pressure. Regardless, a decisive flip of the immediate barrier could trigger a minor run-up for ETH.
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