As we head into Monday, November 4, 2024, global markets are braced for potential volatility as traders digest the latest economic data from the Eurozone, UK, and Australia. The U.S. dollar remains a focal point amid recent economic releases and anticipation around the Federal Reserve’s rate direction, which could influence market sentiment across major currency pairs.
In the currency markets, the EUR/USD pair saw a significant decline, influenced by mixed economic indicators from the Eurozone and robust U.S. data. The euro remains under pressure as traders assess the region’s economic outlook and await insights from the European Central Bank’s forthcoming guidance.
Meanwhile, GBP/USD also experienced volatility, reflecting a weaker British pound amid concerns around the Bank of England’s policy decisions and recent economic reports. The pair’s movement underscores the market’s sensitivity to UK economic data and risk sentiment.
The AUD/USD pair showed a steady downtrend as risk sentiment weighed on the Australian dollar, compounded by recent developments in U.S. economic indicators and expectations surrounding the Reserve Bank of Australia’s future policy stance.
EUR/USD
Technicals in Focus
The EUR/USD pair declined sharply, closing near the 1.0830 level after a choppy session. The pair’s movements were influenced by mixed data from the Eurozone, including inflation figures and U.S. economic data that bolstered the dollar. Technically, the MACD is turning bearish, indicating growing downside momentum. The Stochastic Oscillator is approaching oversold territory, suggesting a potential for a short-term corrective bounce. The 14-day RSI remains in a downtrend, reflecting the pair’s bearish sentiment.
Trading Strategy: Neutral to Sell
Sell below 1.0840-1.0820 with targets at 1.0790-1.0760 and 1.0730-1.0700, with a stop loss above 1.0870. Alternatively, consider long positions above 1.0870 with targets of 1.0900-1.0930, with stops below 1.0840.
GBP/USD
Technicals in Focus
The GBP/USD pair exhibited sharp downward movements, closing around 1.2910 after reaching a session low. The pound weakened amid concerns around UK economic stability and the BoE’s potential policy path. On the technical front, the MACD has shifted to bearish territory, highlighting increasing selling pressure. The Stochastic Oscillator is oversold, which may indicate a possible rebound in the short term. The 14-day RSI remains weak, emphasizing the prevailing bearish tone.
Trading Strategy: Neutral to Sell
Sell below 1.2920-1.2900 with targets at 1.2870-1.2840 and 1.2800-1.2770, with a stop loss above 1.2950. Alternatively, consider buying above 1.2950 with targets at 1.2980-1.3000, with a stop below 1.2920.
AUD/USD
Technicals in Focus
The AUD/USD pair remained under pressure, closing near the 0.6550 level following a volatile session. The pair was impacted by risk-off sentiment and recent economic data from the U.S., which weighed on the Aussie. The MACD indicator shows a gradual shift toward bearish momentum. The Stochastic Oscillator is in oversold territory, which might suggest a corrective bounce. The 14-day RSI remains neutral, indicating a consolidation phase.
Trading Strategy: Neutral to Sell
Sell below 0.6560-0.6540 with targets at 0.6520-0.6500 and 0.6480-0.6460, with a stop loss above 0.6590. Alternatively, consider buying above 0.6590 with targets at 0.6620-0.6650, with stops below 0.6560.
Market Outlook
Looking ahead, traders are likely to focus on upcoming U.S. and Eurozone economic data, which could provide further insights into the future direction of interest rates and overall economic health. In the UK, Bank of England updates will be crucial for GBP pairs as the market seeks clarity on potential policy adjustments. Meanwhile, the Australian dollar’s performance will continue to be influenced by global risk sentiment and developments in U.S. economic data.
Overall, the market is expected to remain reactive to economic releases and central bank communications, with a potential for heightened volatility as traders interpret new information.