Forex News Timeline

Monday, November 29, 2021

Asian shares grind lower as bears take a breather to reconfirm the covid variant fears during early Monday. The need for checking arises as policymake

Asian equities trade mixed as yields, US stock futures rebound.Global scientists, policymakers race to ascertain fears of South African covid variant.Fed versus the rest battle can keep greenback buyers hopeful.Eyes on Fed’s Powell, US President Biden for fresh impulse.Asian shares grind lower as bears take a breather to reconfirm the covid variant fears during early Monday. The need for checking arises as policymakers from the US, Israel and Australia sound hopeful of overcoming the virus variant that roiled global market sentiment the previous day. Adding to the bullish bias could be the recovery in the US Treasury yields, backed by hawkish comments from Atlanta Federal Reserve President Raphael Bostic. That said, MSCI’s index of Asian Pacific shares outside Japan drops 0.14% whereas Japan’s Nikkei 225 prints a 0.50% intraday loss, recovering of late, ahead of Monday’s European session. It’s worth noting that the Asia-Pacific markets witnessed the heaviest daily fall in over three months on Friday amid chatters over the heavy mutation capability of the covid’s South African version. The same backed the World Health Organization’s (WHO) announcement to mark it as a “variant of concern” while also pushing the UK government to call for the special Group of Seven (G7) meeting. On the contrary, zero cases of the virus strain in the US pushed the National Institutes of Health (NIH) officials to renew hopes that the virus vaccines, as well as the booster doses, can help overcome the latest challenge to the global economy. On the same lines were comments from Australia Health Minister Greg Hunt who said, “We are vastly, vastly better prepared than the overwhelming majority of the world, and I say that with great respect to the immense work that’s been done globally.”  Furthermore, Reserve Bank of New Zealand’s (RBNZ) Chief Economist Yuong Ha said in a Wall Street Journal (WSJ) interview on Monday, the new Omicron covid strain is unlikely to alter the central bank’s rate hike plans. Against this backdrop, markets in Australia and New Zealand remain directionless while those from China fail to cheer dovish comments from the People’s Bank of China (PBOC). Indonesia’s IDX print mild gains whereas South Korea’s KOSPI and India’s BSE Sensex lick Friday’s wounds with minimal losses. It’s worth noting that Japan and China recently announced the rejection of flights from South Africa and connected nations. Moving on, German inflation numbers will join US housing data to decorate Monday’s calendar ahead of speech from US President Joe Biden and Fed Chair Jerome Powell. Also in the spotlight were comments from the Bank of Canada (BOC) and the European Central Bank (ECB) policymakers’’ scheduled speeches.

Starting out a fresh week in early trades, the risk sentiment took a big hit on the renewed fears over the Omicron covid variant. Although the sentime

Starting out a fresh week in early trades, the risk sentiment took a big hit on the renewed fears over the Omicron covid variant. Although the sentiment improved over the last hours, with the major economies quickly acting to curb the virus spread while many industry and health experts opine that the effects of the new variant are unlikely to be more severe. Among the latest updates, China's aviation regulator said on Monday that it would suspend Air France from operating four Paris-Tianjin flights from Nov. 29 due to COVID-19 cases. Japanese media outlets reported that entry for all foreigners will be banned almost immediately and an announcement to that effect is expected as early as this afternoon.  The Australian state of Victoria announces a 14-day quarantine requirement for arrivals from parts of Africa. The country’s Health Minister Greg Hunt said, “We are vastly, vastly better prepared than the overwhelming majority of the world, and I say that with great respect to the immense work that’s been done globally.” “Australia’s National Security Committee will meet today to review the evidence and consider actions surrounding the omicron variant and a National Cabinet meeting will be held in the next 48 hours,” Hunt said. Meanwhile, the World Health Organization (WHO) said, “The initial reported infections were among university students,” adding that younger patients tend to have milder symptoms. “Symptoms linked to the omicron coronavirus variant have been mild so far, according to a Covid-19 adviser to the South Africa government and the Pretoria doctor who first sounded the alarm about the new strain,” per Bloomberg. developing story ....

Silver (XAG/USD) consolidates monthly losses around the lowest levels since mid-October during early Monday. The bright metal dropped to the multi-day

Silver refreshes intraday high, extends bounce off six-week low.Bearish MACD signals, sustained break of two-month-old previous support line favor sellers.Multiple levels from August restrict immediate downside, September’s bottom lure bears.Silver (XAG/USD) consolidates monthly losses around the lowest levels since mid-October during early Monday. The bright metal dropped to the multi-day low following the previous week’s clear downside break of an ascending trend line from September 29 and 50-DMA. However, a three-month-old horizontal support area triggered the quote’s latest bounce. Even so, bearish MACD signals and sustained trading below the stated support-turned-resistance line keep XAG/USD sellers hopeful. That said, the 38.2% Fibonacci retracement (Fibo.) level of July-September downside and 50-DMA, respectively around $23.50 and $23.60, limit the commodity’s rebound Should the silver buyers manage to cross the $23.60 hurdle, 50% Fibo. level of $24.10 and the stated previous support line, around $24.20 by the press time, will be in focus. Alternatively, the $22.91-85 support area becomes the key challenge for the short-term sellers ahead of August month’s low near $22.20 and the $22.00 threshold. Given the silver bears stay on the front foot past $22.00, the yearly bottom surrounding $21.40 may challenge the commodity bears before directing them to the $20.00 psychological magnet. Silver: Daily chart Trend: Bearish  

The Australian economy is likely to have contracted in the third quarter of 2021 amid renewed covid lockdowns, although remains poised for a quick upt

The Australian economy is likely to have contracted in the third quarter of 2021 amid renewed covid lockdowns, although remains poised for a quick upturn, the latest Reuters poll of 24 economists showed on Monday. Key quotes “Economists showed that the A$2.07 trillion ($1.5 trillion) economy contracted 2.7% during the July-September quarter. Forecasts ranged from -3.8% to -1.9%.” “The year-over-year growth was estimated at 3.0% but that was over a decline of 3.6% in the third quarter last year, revealing no substantial growth.” “Despite the setback to economic growth last quarter, economists do not see that trend turning into a full-blown recession.” “With about 86% of Australia's adult population now vaccinated and most restrictions eased, a swift recovery is anticipated on higher consumer spending.”AUD/USD Price Analysis: Battles previous support around 0.7150 on oversold RSI

RBNZ's Ha: New variant is unlikely to halt the bank rate rises more to come ...

 RBNZ's Ha: New variant is unlikely to halt the bank rate rises  more to come ...

GBP/USD is trading modestly flat below 1.3350, consolidating its recovery from eleven-month lows of 1.3278 amid a minor improvement in the risk sentim

GBP/USD is in bearish consolidation amid fresh covid and Brexit jitters.Safe-haven USD holds the reins starting out a fresh week. Covid updates, risks trends to lead the sentiment amid a light docket.GBP/USD is trading modestly flat below 1.3350, consolidating its recovery from eleven-month lows of 1.3278 amid a minor improvement in the risk sentiment. Despite the risk reset, the risks remain skewed to the downside for the major, as it continues to bear the brunt of the latest Omicron covid variant and ongoing Brexit woes. Omicron woes add to the Brexit pain The risk sentiment took a hit in early Asia, helping the rebound in the US dollar across the board, as fears over the latest covid strain took over and rattled markets. South Africa's latest surge of COVID-19 cases, apparently driven by the new variant is leading countries around the world to impose new restrictions. However, markets are trying to find their feet amid a few optimistic news concerning the new variant, with Professor Dror Mezorach, head of the coronavirus department at Hadassah University Hospital Ein Karem, noting that the clinical condition of people infected with Omicron is encouraging. Despite the risk recovery, the sentiment around the pound is likely to remain undermined, courtesy of the ongoing Brexit concerns. The European Commission's vice president Margaritis Schinas on Saturday told Britain it has to sort out its own migrant problems post-Brexit. Meanwhile, French President Emmanuel Macron hit out at the UK Prime Boris Johnson on Friday over a tweeted letter, accusing him of being “not serious”. This is in light of the persistent tensions over the French-UK fishing row. Looking ahead, amid the data-light UK and US economic calendar on Monday, the Omicron covid variant updates and their impact on the risk sentiment will continue to lead the way. Investors will reassess the Bank of England’s (BOE) rate hike expectations, in the face of the latest covid strain, which could be an additional downer for the British currency. GBP/USD: Technical levels to consider  

One-month risk reversal (RR) of USD/CHF, a gauge of calls to puts, drops for the fourth consecutive day to recently around -0.012 per the data source

One-month risk reversal (RR) of USD/CHF, a gauge of calls to puts, drops for the fourth consecutive day to recently around -0.012 per the data source Reuters. It’s worth noting that the daily RR slumped the most in a month the previous day amid the market’s risk-off mood, down -0.413, whereas the weekly reading marked the lowest prints in 14 months with a -0.513 level for the week ended on November 26, per Reuters. Hence, it appears that the options market bears are holding controls tightly amid indecision over the Fed’s next move and fresh covid woes triggered by ‘Omnicron’. That said, the USD/CHF pair consolidates the biggest daily losses since March 2020 by the press time of early Monday, up 0.30% intraday around 0.9255. Moving on, speeches from US President Joe Biden and Federal Reserve (Fed) Chairman Jerome Powell will be important for the USD/CHF traders to watch for fresh impulse.

AUD/USD challenges intraday high around 0.7145, up 0.10% on a day during early Monday. In doing so, the Aussie pair keeps late Friday’s bounce off a t

AUD/USD prints mild gains, pokes intraday top to consolidate Friday’s losses.September’s low, monthly resistance line also challenges recovery moves.0.7000-6990 appears a tough nut to crack for the bears.AUD/USD challenges intraday high around 0.7145, up 0.10% on a day during early Monday. In doing so, the Aussie pair keeps late Friday’s bounce off a three-month low to challenge the yearly support-turned-resistance. Given the oversold RSI conditions, the latest corrective pullback is likely to cross the 0.7150 immediate hurdle. However, September’s low and a descending trend line from November 02, around 0.7170 and 0.7230 respectively, will challenge the recovery moves. Even if the AUD/USD bulls manage to cross the 0.7230 hurdle, July’s low and the mid-November’s swing high, close to 0.7290 and 0.7370 in that, will act as additional filters to the north for them to overcome. Alternatively, the yearly low of 0.7105 remains in the spotlight during the fresh declines. That said, the 38.2% Fibonacci retracement (Fibo.) of March 2020 to February 2021 run-up around 0.7050 and a horizontal area comprising multiple levels marked between June and November 2020, near 0.7000-6990, will be the key levels to follow the fall past-0.7105. Overall, AUD/USD bears remain in the driver’s seat but the further downside has bumpy road. AUD/USD: Daily chart Trend: Further weakness expected  

The European Central Bank (ECB) doesn’t need to intervene in order to tighten the monetary policy now, as inflation is driven by temporary factors, th

The European Central Bank (ECB) doesn’t need to intervene in order to tighten the monetary policy now, as inflation is driven by temporary factors, the central bank’s Executive Board member Fabio Panetta said over the weekend. Key quotes “In some countries the increase in prices has generated angst.” “The central bank is not intervening because if it did, it would create more damage than benefit. It’s like an illness, not all medicines are good for all illnesses.” Current inflation is “bad,” but also temporary -- driven by supply chain snags and energy price increases, which “are bound to be overcome.” “If inflation looked like becoming more permanent, he would be among the first in favor of ECB intervention.”

An official from the People's Bank of China (PBOC) indicated on Monday that the country's central bank will be keeping the liquidity taps open. Key qu

An official from the People's Bank of China (PBOC) indicated on Monday that the country's central bank will be keeping the liquidity taps open. Key quotes “PBOC will enact prudent monetary policy.” “Will maintain ample liquidity in order to support employment.”

GBP/JPY is firmer at the start of the week despite the recent volatility across financial markets at the end of last week pertaining to the new corona

GBP/JPY bulls are eyeing a significant correction for the opening sessions. Risks remain to the downside considering the unknown around coronavirus new variant. GBP/JPY is firmer at the start of the week despite the recent volatility across financial markets at the end of last week pertaining to the new coronavirus variant that is potentially resistant to current vaccines. The yen was bid up and the best performing currency as flows move into safe havens which sent GBP/JPY down heavily.  However, the markets are taking a breather at the start f the week and consolidation is in plat. This opens the risk of an upside correction in the cross the following illustrates where there is potential for a deep correction to test old support in a 50% mean reversion: GBP/JPY daily chart

Having witnessed a large risk-off move in the market’s response to the South African origin COVID-19 variant, sentiment improves during early Monday a

US 10-year Treasury yields, S&P 500 Futures consolidate the biggest daily losses since early pandemic days.Comments from US NIH officials, Israel help to cut back on the covid variant fears.Fed’s Bostic rejects challenges to Fed’s rate hike, ECB’s Lagarde got reason to defend easy money policies.Speeches from US President Biden, Fed Chair Powell will be the key.Having witnessed a large risk-off move in the market’s response to the South African origin COVID-19 variant, sentiment improves during early Monday as health officials from the US and Israel placate fears of a widespread outbreak of the deadly virus strain. Having identified zero cases of the fresh COVID-19 infections in the US, the National Institutes of Health (NIH) officials renewed hopes that the virus vaccines, as well as the booster doses, can help overcome the latest challenge to the global economy. On the same lines were comments from Israeli Professor Dror Mevorach who terms ‘Omnicron’ as less severe than the ‘Delta’ version of the coronavirus. It’s worth noting that Australia and Canada become the latest among the top-tier economies to announce fresh infections relating to the stated virus variant, preceding the UK, Italy, Belgium and Israel. Following the initial breakout from South Africa, the World Health Organization (WHO) termed the covid strain as “a variant of concern” while also dubbing it as ‘Omnicron’. The risk appetite roiled the previous day after multiple countries raised concerns over the fresh version of the coronavirus, especially at the time when the major central banks were expected to announce monetary policy tightening. The same weighed down the yields and equities while also taking the US Dollar Index (DXY) to the south, making the Japanese yen (JPY) the winner among the G10 currencies. However, recent comments from Atlanta Federal Reserve President Raphael Bostic reject market talks that the virus strain will ease inflation fears by saying, “Covid is the source of inflation.” On the contrary, European Central Bank (ECB) President Christine Lagarde said, "There is an obvious concern about the economic recovery [of the euro zone] in 2022, but I believe we have learned a lot.” ECB’s Lagarde adds during the interview to Italian news, per Reuters, “We now know our enemy and what measures to take. We are all better equipped to respond to a risk of a fifth wave or the Omicron variant". Given the mixed chatters over ‘Omnicron’, market players are likely to stay on the current path of consolidating Friday’s losses ahead of the key speeches from US President Joe Biden and Federal Reserve (Fed) Chairman Jerome Powell.

NZD/USD is higher at the start of the week, adding some 0.16% at the time of writing as currency markets calm Asia after the initial shock of the disc

NZD/USD is higher in the open this week as risk-off currencies come up for air. A lot of good news was already priced into the Kiwi, leaving the bird vulnerable.NZD/USD is higher at the start of the week, adding some 0.16% at the time of writing as currency markets calm Asia after the initial shock of the discovery of the Omicron coronavirus variant. NZD/USD trades around 0.6820 after rising to a high of 0.6834  on the day from a low of 0.6807.  However, there could be f more volatility with little still known about the new strain ahead, although there are some good news wises related to the variant shining through the cracks on Monday. A tweet is doing the rounds through financial social media that states that Israel's Prof. Dror Mezorach, head of the coronavirus department at Hadassah University Hospital Ein Karem, said the preliminary reports on the clinical condition of people infected with the new variant are encouraging.  ''If it continues this way, this might be a relatively mild illness compared to the delta variant, and paradoxically, if it takes over, it will lead to lower infection rates,'' and it will be easier to deal with globally.  However, what has roiled markets is the mutations in the spike protein that is suggesting it could be resistant to current vaccines. Additionally, Omicron has already been detected in places including Australia, Britain, Canada, Germany and Hong Kong. BioNTech said Friday it may know within two weeks if the vaccine it developed with Pfizer needs to be reworked. Meanwhile, ''NZD/USD has actually held up fairly well (compared to equities, oil and bonds), but NZD/JPY and NZD/EUR have been crushed. Very little is yet known about Omicron, but if it proves to be problematic, and its impact more global than local, that does speak to all economies taking a hit, and not just New Zealand,'' ''In turn, that means less for relative prices like exchange rates,'' the analysts stated. ''But a lot of good news was already priced into the Kiwi (particularly on the interest rate/carry side of the equation) and that could make the NZD more vulnerable, particularly against the low or negative policy rate countries like Japan and Europe.''  

US Dollar Index (DXY) stays firmer around 96.25 during Monday’s Asian session, consolidating the biggest daily loss of 2021. In addition to the market

DXY struggles for clear direction after the heaviest daily fall in a year.Bullish MACD signals, 10-DMA keep buyers hopeful, previous resistance from July adds to the downside filters.US Dollar Index (DXY) stays firmer around 96.25 during Monday’s Asian session, consolidating the biggest daily loss of 2021. In addition to the market’s consolidation, 10-DMA and bullish MACD signals also add to the DXY’s bullish bias, which in turn hints at the fresh run-up towards targeting the 96.65 horizontal hurdle. It should be noted, however, that the latest high around 96.95 and the 97.00 will probe the US Dollar Index upside past 96.65. Following that, June 2020 peak surrounding 97.80 should lure the optimists. Meanwhile, 10-DMA and the resistance-turned-support line from July 20, respectively around 96.20 and 95.60, will challenge the quote’s short-term declines. Also acting as the key support level is September’s peak near 94.50, a break of which will roil the bullish trend, at least for a short term. DXY: Daily chart Trend: Bullish  

In recent trade today, the People’s Bank of China (PBOC) set the yuan (CNY) at 6.3872 vs the estimated 6.3805 and the previous 6.3936. About the fix C

In recent trade today, the People’s Bank of China (PBOC) set the yuan (CNY) at 6.3872 vs the estimated 6.3805 and the previous 6.3936. About the fix China maintains strict control of the yuan’s rate on the mainland. The onshore yuan (CNY) differs from the offshore one (CNH) in trading restrictions, this last one is not as tightly controlled. Each morning, the People’s Bank of China (PBOC) sets a so-called daily midpoint fix, based on the yuan’s previous day closing level and quotations taken from the inter-bank dealer.

USD/CAD bounces off the daily bottom to 1.2750, down 0.30% intraday, while nursing the previous day’s heavy run-up during Monday’s Asian session. Reco

USD/CAD rebounds from intraday low after the biggest D1 jump since August.Canada reports two cases of the new covid variant in Ottawa.WTI crude oil consolidates Friday’s 13% slump as health officials from the US, Israel sound optimistic.BOC’s Macklem, Fed’s Powell eyed for fresh impulse.USD/CAD bounces off the daily bottom to 1.2750, down 0.30% intraday, while nursing the previous day’s heavy run-up during Monday’s Asian session. Recovery in the prices of Canada’s main export item, WTI crude oil, seems to have underpinned the latest pullback moves of the Loonie pair even as Canada registers two cases of the recently discovered South African covid variant in Ontario. Additionally favoring the USD/CAD sellers could be the recent positives from the US and Israel concerning the ability to fight back the coronavirus strain. That said, WTI rises 4.50% to $71.25 after marking a 13% slump the previous day. The black gold’s recovery moves should have taken clues from the OPEC’s delay of the Joint Technical Committee and the Joint Ministerial Monitoring Committee (JTC and JMMC) meetings to Wednesday and Thursday. Having identified zero cases of the fresh COVID-19 infections in the US, the National Institutes of Health (NIH) officials renewed hopes that the virus vaccines, as well as the booster doses, can help overcome the latest challenge to the global economy. On the same lines were comments from Israeli Professor Dror Mevorach who terms ‘Omnicron’ as less severe than the ‘Delta’ version of the coronavirus. Alternatively, comments from Atlanta Federal Reserve President Raphael Bostic, rejecting market talks that the virus strain will ease inflation fears by saying, “Covid is the source of inflation,” keep USD/CAD buyers hopeful. Amid these plays, US 10-year Treasury yields rise five basis points (bps) to 1.53% following the heaviest daily fall since the early days of the pandemic in 2020. Also portraying the improvement in the market sentiment are the mildly bid US stock futures. Looking forward, second-tier data from the US and Canada may offer intermediate clues to the USD/CAD traders but major attention will be given to the speeches from the Bank of Canada (BOC) Governor Tiff Mecklem and Fed Chairman Jerome Powell. While BOC’s Mecklem has a little room to reject bears, considering two cases of ‘Omnicron’ at home, Fed’s Powell may surprise markets and renew US dollar strength. Technical analysis A clear upside break of the three-month-old resistance line, around 1.2780 by the press time, becomes necessary for the USD/CAD bulls to keep controls. Otherwise, pullback moves towards Thursday’s swing low near 1.2640 can’t be ruled out.  

There is some potentially good news crossing the wires out of Israel that suggest the new variant of the coronavirus, named Omicron, that has otherwis

There is some potentially good news crossing the wires out of Israel that suggest the new variant of the coronavirus, named Omicron, that has otherwise distressed risk appetite of late. Prof. Dror Mezorach, head of the coronavirus department at Hadassah University Hospital Ein Karem, said the preliminary reports on the clinical condition of people infected with the new variant are encouraging. '' If it continues this way, this might be a relatively mild illness compared to the delta variant, and paradoxically, if it takes over, it will lead to lower infection rates,'' and it will be easier to deal with globally.  Market implications No news is good news at the start of the week, but this could see corrections continue into the European open as traders take profits on long volatility and risk-FX. AUD/JPY, the forex market's risk barometer, for instance, is already embarking on a test of the 38.2% Fibonacci level:AUD/JPY Price Analysis: Bulls testing a firm hourly resistance

USD/JPY licks its wounds around 113.75, up 0.55% intraday, following the heaviest daily fall in 20 months. That said, the yen pair tracks US Treasury

USD/JPY consolidates the heaviest daily loss since March 2020, bounces off 13-day low.WHO termed Omnicron as a “variant of concern”, Japan tightens border controls.US Treasury yields recover as Fed’s Bostic rejects dovish concerns.Japan Retail Sales eased in September, Fed’s Powell, US President Biden eyed for fresh impulse.USD/JPY licks its wounds around 113.75, up 0.55% intraday, following the heaviest daily fall in 20 months. That said, the yen pair tracks US Treasury yields and stock futures as global markets rethink the virus variant and its ability to roil the global economy after Friday’s harsh reaction. The benchmark US 10-year Treasury yields add five basis points (bps) to 1.53% whereas the S&P 500 Futures rise 0.80% at the latest. The corrective pullback seems to track comments from the US health officials and those from Israel that keep the traders hopeful of overcoming the coronavirus strain after the fears of ‘Omnicron’ roiled market sentiment the previous day. Having identified zero cases of the fresh COVID-19 infections in the US, the National Institutes of Health (NIH) officials renewed hopes that the virus vaccines, as well as the booster doses, can help overcome the latest challenge to the global economy. On the same lines were comments from Israeli Professor Dror Mevorach who terms ‘Omnicron’ as less severe than the ‘Delta’ version of the coronavirus. Also favoring the US Treasury yields and the USD/JPY buyers were the weekend comments from Atlanta Federal Reserve President Raphael Bostic, rejecting market talks that the virus strain will ease inflation fears by saying, “Covid is the source of inflation.” At home, Japan’s Prime Minister Fumio Kishida announced blocking the border for foreigners arriving from South Africa and eight other nations. It should be noted that Japan’s Retail Trade eased to 0.9%, versus 1.1% market consensus and -0.5% prior, in September. Looking forward, the virus developments in the West will be particularly more important for the USD/JPY traders, which in turn highlights today’s speech from US President Joe Biden to update on the US reaction to the COVID-19 variant. Additionally, comments from Fed Chairman Jerome Powell will be observed closely for fresh impulse too. Technical analysis A daily closing beyond the support-turned-resistance from early October, around 113.75 by the press time, becomes necessary for the USD/JPY buyers to retake controls. On the contrary, bears remain on the sidelines until the quote stays above 50-DMA level around 113.15.  

Australia Company Gross Operating Profits (QoQ) above forecasts (3%) in 3Q: Actual (4%)

AUD/JPY is holding up at the start of the week following turbulent time over the remaining sessions of last week pertaining to the spike in risk-off a

AUD/JPY are testing a critical level of resistance in the highs on the hourly chart.Despite covid risks, AUD is firm in the opening session at daily support vs the greenback.AUD/JPY is holding up at the start of the week following turbulent time over the remaining sessions of last week pertaining to the spike in risk-off as a consequence of the new coronavirus variant that is potentially resistant to current vaccines. The Aussie took a battering last week on the back of both a hawkish set of Fed minutes and the worries of the implications of coronavirus within thin market conditions around the US Thanksgiving holidays. AUD/USD fell to a long-term support zone near 0.7110 and the yen benefitted from the risk-off flows sending AUD/JPY to the lowest levels since October. However, we are seeing a correction in the moves across the forex space and the cross is higher by some 0.67% so far. AUD/JPY daily chart AUD/JPY 4-hour chart From a 4-hour perspective, the price is headed into an area of resistance where the typical Fibonacci retracements can be found between 81.50 and near to 82 the figure. Beyond there, the price could be hard-pressed and bears will be lurking to take advantage of a discount considering the risk-off themes. 

Gold (XAU/USD) reverses late Friday’s pullback from $1,815 during Monday’s Asian session. In doing so, the metal keeps the previous day’s bounce off a

Gold picks up bids to refresh intraday top, struggled on Friday.Virus variant challenges market sentiment but US dollar weakness sounds fishy ahead of Fed’s Powell.Treasury yields dropped and drowned the DXY but US Health Officials are confident and save the greenback.Gold Weekly Forecast: XAU/USD looks to extend rebound amid renewed coronavirus fearsGold (XAU/USD) reverses late Friday’s pullback from $1,815 during Monday’s Asian session. In doing so, the metal keeps the previous day’s bounce off a two-month-old support line amid market fears emanating from the coronavirus strain, dubbed as ‘Omnicron’. Grave symptoms like heavy mutations and the ability to resist vaccines enable Omicron to challenge the market’s previous optimism and calls for tighter monetary policies. The same weighed down the US Treasury yields and the US Dollar Index (DXY) the previous day but gold prices posted a volatile day with no gains amid mixed beliefs over the US dollar and the Fed’s next step. The US National Institutes of Health (NIH) officials convey no cases of the stated virus variant in the world’s largest economy and remain hopeful that the virus vaccines, as well as the booster doses, can help overcome the fresh challenge. However, Atlanta Federal Reserve President Raphael Bostic rejected market talks that the virus strain will ease inflation fears by saying, “Covid is the source of inflation.” Elsewhere, Canada and Australia are the latest ones to join the UK, Europe and South Africa to find cases of the COVID-19 variant whereas many counties have rejected flights from Africa and surrounding countries. Read: Covid Special Report: How will worst coronavirus variant seen to date affect markets this week? Even so, S&P 500 Futures print mild gains whereas the US 10-year Treasury yields jump 4.5 basis points (bps) to 1.53% at the latest. Moving on, gold traders should keep their eyes on Fed Chairman Jerome Powell’s speech for fresh impulse, as well as comments from US President Joe Biden. Should Fed’s Powell cite grave concerns due to the recent virus variant breakout, the bullion prices are likely to rise more. Technical analysis Gold struggles between a two-month-old support line and a convergence of the 100-day and 200-day EMAs. Hence, a clear break of the $1,785-1,800 area becomes necessary for the traders to get a fair view of the near-term trend. However, the bearish MACD signals and a likely pick-up in the US dollar’s safe-haven demand challenge the gold buyers. Other than the $1,800 threshold, the latest swing high near $1,815-16 may also challenge the metal’s upside momentum before challenging the $1,834 barrier comprising highs marked in July and September. It’s worth noting that the horizontal line of $1,850 adds to the upside filters before directing the quote to the monthly high of $1,877. Alternatively, a downside break of the $1,785 will quickly fetch gold prices to an ascending support line from August, near $1,760. Should the gold bears keep the reins past $1,760, the bullion becomes vulnerable to test September’s low of $1,721, a break of which will direct the bears to aim for the yearly low of $1,687. Gold: Daily chart Trend: Sideways  

Japan Retail Trade s.a (MoM) registered at 1.1% above expectations (-1.6%) in September

Japan Large Retailer Sales registered at 0.9%, below expectations (5.2%) in September

Japan Retail Trade (YoY) below forecasts (1.1%) in September: Actual (0.9%)

WTI licks Friday’s wounds of 13% slump while defending the $70.00 threshold during Monday’s initial Asian session. Even so, the black gold keeps the p

WTI consolidates Friday’s heavy losses around September’s low.Previous support from November 2020 challenges corrective pullback, bearish MACD signals also favor sellers.March’s top offer immediate support, 100-DMA adds to the upside filters.WTI licks Friday’s wounds of 13% slump while defending the $70.00 threshold during Monday’s initial Asian session. Even so, the black gold keeps the previous day’s downside break of the yearly support line, now resistance, while keeping the sellers on the driver’s seat. Adding to the bearish bias is the MACD line that stays deep down inside the red territory. That said, March month’s high of around $67.85 offers immediate support to the commodity prices ahead of 38.2% Fibonacci retracement (Fibo.) of November 2020 to October 2021 upside, close to $65.40. It should be noted, however, that September’s swing low near $61.80 becomes a tough nut to crack for WTI bears. On the contrary, a daily closing beyond the stated support-turned-resistance around $71.35 needs validation from the 100-DMA level of $73.90 and the $74.00 threshold to recall the buyers. Following that, November 22 low near $74.65 and July’s top of $76.40 will act as additional resistance for the bulls to cross. WTI: Daily chart Trend: Further weakness expected  

EUR/USD retreats to 1.1280 during Monday’s initial Asian session, following the heaviest daily jump of 2021. The coronavirus variant, dubbed as ‘Omicr

EUR/USD reverses Friday’s corrective pullback, refreshes intraday low at the latest.US NIH officials try to placate Omicron fears but ECDC and ECB’s Lagarde convey the pessimism.Market sentiment worsens on concerns that virus strain will stop previously hawkish central bank actions.President Biden will update US reaction to the virus variant, Fed’s Powell is up for a speech too.EUR/USD retreats to 1.1280 during Monday’s initial Asian session, following the heaviest daily jump of 2021. The coronavirus variant, dubbed as ‘Omicron’, shook markets and the US dollar on Friday before the greenback started nursing losses a few hours back. With its grave symptoms like heavy mutations and ability to fight vaccines better, Omicron raises serious concerns against the market’s previous optimism during an otherwise holiday-thinned day. Not only the fears concerning health but challenges to the earlier talks of the monetary policy tightening also seem to have closed by the stated virus variant. The European Central Bank (ECB) was already hesitant to accept the hawkish calls for rate hikes and/or end the Pandemic Emergency Purchase Programme (PEPP) and the latest strain of the coronavirus offered another reason for them to turn dovish. Following the wide chatters of the stated ‘Omicron’, ECB President Lagarde crossed wires during an interview with Italian media in the weekend, shared by Reuters. ECB’s Lagarde said, "There is an obvious concern about the economic recovery [of the euro zone] in 2022, but I believe we have learnt a lot. We now know our enemy and what measures to take. We are all better equipped to respond to a risk of a fifth wave or the Omicron variant". On the other hand, Atlanta Federal Reserve President Raphael Bostic spoke during the weekend as well while saying, “Covid is the source of inflation.” Amid these plays, US stock futures print mild gains after the heavy fall of Friday whereas the US 10-year Treasury yields lick their wounds near 1.482%, the lowest level in 13 days. It’s worth noting that the US Dollar Index (DXY) struggles around 96.25% after declining the most since May. Given the divergent view of the policymakers from Europe and the US, as well as higher hopes from the Fed than the ECB to announce rate hikes, the EUR/USD renews downside of late. The moves could escalate if Fed Chair Jerome Powell refrains from accepting the fact that the new version of the COVID-19 challenges the odds of the rate. It’s worth noting that US President Joe Bide and ECB President Christine Lagarde are up for speeches as well, which in turn keeps the EUR/USD traders cautious ahead of the events. Also important are the US housing data and German inflation data from Europe. Technical analysis Despite crossing 10-DMA on a daily closing basis, around 1.1280 by the press time, even short-term EUR/USD bulls remain away from the entries until the quote crosses a monthly resistance line around 1.1445-50.  

Following the comments from US National Institutes of Health (NIH) Director Francis S. Collins, coupled with consultation from top NIH official Anthon

Following the comments from US National Institutes of Health (NIH) Director Francis S. Collins, coupled with consultation from top NIH official Anthony Fauci, the White House released a statement over the Omicron during early Monday morning in Asia. Key quotes Dr. Fauci informed the President that while it will take about two more weeks to have more information about the transmissibility, severity and other characteristics of the Covid-19 Omicron variant, he continues to believe that existing vaccines are likely to provide a degree of protection against severe cases of Covid. Fauci reiterated that boosters provide strongest protection from Covid. The President will provide an update on the new variant and the US response on Monday. FX reaction The news weighs on the market sentiment and drowns the risk barometer AUD/USD towards a three-month low by the press time. Read: AUD/USD retreats towards 0.7100 as ‘Omicron’ sours sentiment

Early Monday morning in Asia, Canadian Health Minister Jean-Yves Duclos crossed wires via Reuters while saying, “Two cases of omicron variation of con

Early Monday morning in Asia, Canadian Health Minister Jean-Yves Duclos crossed wires via Reuters while saying, “Two cases of omicron variation of concern have been identified in Ontario.” The details suggest that the stated cases were found in Ottawa. FX implications USD/CAD drops back to 1.2750, retreats from the highest levels in two months flashed on Friday on the news. The reason could be linked to the oil traders catching a breather following the 13% slump amid OPEC’s delaying of the meet to  Wednesday and Thursday (1 and 2 December).  Read: USD/CAD Weekly Forecast: COVID strikes again

AUD/USD drops back to 0.7118, following a timid bounce off a three-month low surrounding 0.7115, during early Monday morning in Asia. In doing so, the

AUD/USD fades bounce off three-month low after the heaviest daily fall since early November.Australia reports first case of Omincron but PM Morrison rejects calls of quarantine before Christmas.Virus roiled markets by pushing back monetary policy tightening hopes and wither growth optimism.US housing data, Fed’s Powell will be important but nothing more than the virus updates.AUD/USD drops back to 0.7118, following a timid bounce off a three-month low surrounding 0.7115, during early Monday morning in Asia. In doing so, the Aussie pair proves right on its risk barometer status amid the market's fears emanating from the coronavirus variant dubbed as ‘Omicron’. It should be noted, however, that the Aussie policymakers are trying to placate the fears but have had little success of late. With its grave symptoms like heavy mutations and ability to fight vaccines better, Omicron raises serious concerns against the market’s previous optimism during an otherwise holiday-thinned day. Not only the fears concerning health but challenges to the earlier talks of the monetary policy tightening also seem to have closed by the stated virus variant. Australia, unfortunately, joins the key global economies that registered Omicron cases. “Australia and Austria reported their first cases of the Omicron variant, joining a group of countries including the U.K., Germany, Belgium, Israel and Italy that have detected a strain that authorities say could be more transmissible than other variants,” per the Wall Street Journal (WSJ). Prime Minister Scott Morrison is up for calling an emergency cabinet meeting, per ABC News, while also terming the emergence of the coronavirus variant as "concerning". However, the policymaker also said, per ABC News, that Australia had dealt with other strains of the virus before and it is "too early" to make decisions about reinstating quarantine before Christmas. Hence, the AUD/USD traders remain pressured around a three-month low flashed on Friday, also inch closer to the yearly bottom surrounding 0.7100. However, bears await more news to copy Friday’s moves. It should be noted that global markets roiled and riskier assets suffered the most in multiple weeks the previous day on the news of the South African strain of the coronavirus. The fears gain momentum on chatters that the stated variant spreads faster and can resist the vaccines. However, the findings are still in infancy and mixed as well, troubling traders of late. Even so, the US 10-year Treasury yields dropped the most since the early days of the pandemic whereas the US stocks dropped over 10% during a few hours of the trading session on “Black Friday. It’s worth observing that the US dollar fails to cheer the risk-off mood amid challenges to the Fed rate hike concerns. Hence, today’s speech from Federal Reserve (Fed) Chairman Jerome Powell becomes the key for the markets, as well as the US Pending Home Sales for October, expected 1.0% MoM versus -2.3% prior. Above all, the COVID-19 updates will be crucial to watch for the near-term market direction. Technical analysis A clear downside break of the yearly support line, now resistance around 0.7145, directs AUD/USD towards further south than the yearly low of 0.7105. That said, the 38.2% Fibonacci retracement (Fibo.) of March 2020 to February 2021 run-up around 0.7050 and a horizontal area comprising multiple levels marked between June and November 2020, near 0.7000-6990, will be the key to follow. Meanwhile, any corrective pullback remains elusive below 0.7145, a break of which can recall short-term buyers to aim for the monthly resistance line around 0.7240. In a case where AUD/USD bulls manage to keep the reins past 0.7240, July’s low and the mid-November’s swing high, respectively around 0.7290 and 0.7370, will be on their radar.  

“There is no evidence of an omicron variation in the United States,” said Francis S. Collins, Director of the US National Institutes of Health (NIH).

“There is no evidence of an omicron variation in the United States,” said Francis S. Collins, Director of the US National Institutes of Health (NIH). The health official also rejected the claims that the virus strain is immune to the current vaccines while saying, “Current vaccines are likely to protect against Omicron.” On the other hand, the European Centre for Disease Prevention and Control (ECDC) conveyed worries during the weekend while saying, “The omicron variant is the most divergent variant in significant numbers.” “We are concerned omicron may significantly reduce vaccines' effectiveness and boost the risk of reinfections,” added ECDC. ECDC also mentioned that the overall risk for the EU/EEA associated with the SARS-COV-2 variant omicron is high to very high. Market reaction Given the mixed news and early hours of the Asian trading session on Monday, not to forget Friday’s heavily volatile markets, global markets are yet to respond to the news. However, the risk-on is surely faded. Read: Covid Special Report: How will worst coronavirus variant seen to date affect markets this week?
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