Market Fundamental Analysis by RoboForex

[Vlad RF]

USDJPY: the yen may continue to lose ground

The increase in US building permits and a Fed official’s speech may support the US dollar. Discover more in our analysis for 19 November 2024.

USDJPY forecast: key trading points

• US Housing Starts in October: previously at 1.354 million, projected at 1.340 million
• US building permits in October: previously at 1.425 million, projected at 1.440 million
• Speech by Federal Reserve official Jeffrey Schmid
• USDJPY forecast for 19 November 2024: 157.60

Fundamental analysis

Housing Starts, representing the total number of projects initiated during the reporting month, are compiled from surveys of property owners and construction companies. These statistics cover approximately 95% of all housing projects in the country. The data are adjusted for seasonal factors and weather conditions to improve accuracy.

This indicator is published during the second ten-day period of each month as part of the general construction report, including data on building permits and completed projects. According to the fundamental analysis for 19 November 2024, construction activity may decline to 1.340 million from the previous reporting period. However, this decrease is not critical and is unlikely to impact the USDJPY rate.

Building permits reflect the seasonally adjusted number of permits issued to start new projects. These figures represent an annualised housing construction rate and should be interpreted as the projected number of permits for the year if current trends persist. This indicator is considered a vital metric of the housing market and a reflection of the overall state of the economy. As a leading metric for one of the most critical economic sectors, building permits provide insight into broader economic trends. The forecast for 19 November 2024 anticipates an increase in issued building permits to 1.440 million. Although the rise is modest, it is a positive factor for the US dollar.

Fed official Jeffrey Schmid, the CEO of the Federal Reserve Bank of Kansas City, is scheduled to deliver a speech by the end of the US trading session. His report may include data on the near-term development of the US monetary policy.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

Lower BoC rate expectations add to pressure on the USDCAD

The USDCAD rate is testing the critical support area. Find out more in our analysis for 20 November 2024.

USDCAD forecast: key trading points

• The strengthening of the Canadian dollar is due to a rise in Canada’s inflation to 2% in October 2024
• Prices increased across five of eight CPI components, primarily driven by petrol price growth
• Weaker expectations of a substantial Bank of Canada rate cut are putting pressure on the USDCAD currency pair
• USDCAD forecast for 20 November 2024: 1.3900

Fundamental analysis

The USDCAD rate is bouncing off the 1.3950 support level. The currency pair is slightly correcting after declining for two consecutive trading sessions. The US dollar lost over 1% amid buyers’ failure to gain a foothold above the 1.4100 level. The current strengthening of the Canadian dollar is fuelled by inflation data, which eases expectations about the size of the Bank of Canada’s interest rate cuts.

Canada’s inflation rose to 2% in October. Prices increased across five of eight CPI components, primarily driven by petrol price growth. The return of inflation to the Bank of Canada’s 2% target suggests that rate cuts will continue, but the size of cuts will depend on the analysis of economic data. According to today’s USDCAD forecast, lower expectations of a substantial BoC rate cut will further pressure the currency pair, contributing to a potential breakout below the key 1.3950 support level.

Market expectations about the Fed’s policy also changed. Federal Reserve Chair Jerome Powell emphasised economic resilience, which allows the regulator to maintain a restrained approach to interest rate cuts. According to the CME FedWatch Tool, the likelihood of a December rate cut decreased to 58.9% from 76.8% a month ago.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EURUSD halted its decline: correction is complete; the market awaits news

The EURUSD pair has halted its decline. The market is awaiting greater clarity on Trump’s policy. Find out more in our analysis for 21 November 2024.

EURUSD forecast: key trading points

• The EURUSD pair is no longer in a downward trend
• The market is analysing what to expect from the new US White House administration
• EURUSD forecast for 21 November 2024: 1.0464

Fundamental analysis

The EURUSD rate is consolidating around 1.0552 on Thursday, following yesterday’s decline.

Investors are exercising caution as they await further data on the future actions of US President-elect Donald Trump. Additionally, forecasts of a less aggressive Federal Reserve interest rate cut have already been priced into the primary currency pair.

The market needs to interpret what exactly Trump’s campaign promises mean not only for the US but also for the rest of the world.

The US dollar has strengthened by over 2% since the US presidential election.

The EURUSD forecast for today remains neutral.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

Gold (XAUUSD) rises, reaching 2,700 USD

XAUUSD prices continue strengthening significantly after forming a local trough and reversing upwards. Further growth may follow a brief correction. Discover more in our XAUUSD analysis for today, 22 November 2024.

XAUUSD forecast: key trading points

• Market focus: US statistics on the Composite Purchasing Managers’ Index (PMI) and Michigan Consumer Sentiment Index are due today
• Current trend: strong upward movement
• XAUUSD forecast for 22 November 2024: 2,643 and 2,700

Fundamental analysis

XAUUSD quotes have completed a downward correction and reversed upwards, displaying significant growth towards the long-term trend. This growth is supported by demand from central banks, the Federal Reserve’s interest policy of cutting interest rates, and escalating global geopolitical tensions.

A crucial release of US statistics is expected today – the Composite Purchasing Managers’ Index (PMI) and Michigan Consumer Sentiment Index. Weaker-than-forecast statistics could exert pressure on the US dollar and support XAUUSD. Conversely, stronger figures may prompt a correction in the pair.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EURUSD is in a consolidation phase following a sharp decline: the market is too nervous

The euro hit a new low before recovering. Investors are observing signs of a slowdown in European economies. Find out more in our analysis for 25 November 2024.

EURUSD forecast: key trading points

• The EURUSD pair reached a new low and recovered
• Investors expect a swift reduction in ECB interest rates to support weak economies
• EURUSD forecast for 25 November 2024: 1.0500 and 1.0414

Fundamental analysis

The EURUSD rate is hovering around 1.0476 on Monday after dropping to 1.0331 earlier.

A rather gloomy business survey triggered the euro’s decline, which revealed a contraction in the two largest European economies – France and Germany – in November. The market believes that the re-election of Donald Trump as US president will further weaken the already fragile European economy. Potential import duties could hurt Germany’s export-oriented economy. These risks are significant, putting substantial pressure on the EUR rate.

As a result, the market is betting that the ECB will lower interest rates more aggressively to address the economic weakness. At the same time, the Federal Reserve is expected to take a more cautious approach. An increase in the interest rate differential will make the euro less appealing, boosting demand for dollar-dominated assets.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

USDJPY is under pressure amid expectations of a BoJ interest rate hike

The USDJPY rate is recovering after falling for two days. Discover more in our analysis for 28 November 2024.

USDJPY forecast: key trading points

• The Japanese yen has strengthened by over 2.6% in the past two days due to expectations of a monetary policy tightening by the BoJ
• The Bank of Japan’s chief hinted at the likelihood of a December interest rate hike to support the yen
• Market expectations of a 25-basis-point rate hike in Japan stand at 60%
• Analysts expect Tokyo’s core CPI to rise to 2.3% in October
• USDJPY forecast for 28 November 2024: 152.90

Fundamental analysis

The USDJPY rate rises following the bears’ failure to secure a position below the 151.25 support level. The Japanese yen has strengthened by more than 2.6% in the past two days due to expectations that the BoJ may raise the interest rate as early as next month. The US dollar is under additional pressure from a potential Federal Reserve rate cut in December. In addition, key US inflation data aligned with market expectations, signalling no changes in the Fed’s monetary policy.

BoJ Governor Kazuo Ueda had earlier referred to the likelihood of a December interest rate hike, citing the need to support the yen. Market players expect a 25-basis-point rate hike in Japan with a 60% probability, well above the 50% recorded a week ago. Most analysts share these expectations.

Investors are also eagerly awaiting Friday’s release of Japan’s inflation data, which may affect the BoJ’s further actions. Tokyo's core CPI is projected to rise to 2.3% in October from 1.8%, heightening expectations of monetary policy tightening. Against this backdrop, today’s USDJPY forecast shows that the Japanese yen will likely strengthen further.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

Gold (XAUUSD) is up, rising above 2,650 USD

This week, XAUUSD prices received support from buyers at the 2,600 USD level and reversed upwards, with growth likely to continue. More details in our XAUUSD analysis for today, 29 November 2024.

XAUUSD forecast: key trading points

• Market focus: the US markets are closed as the country celebrates Thanksgiving Day
• Current trend: Upward movement
• XAUUSD forecast for 29 November 2024: 2,650 and 2,700

Fundamental analysis

XAUUSD quotes completed a downward correction and confidently reversed upwards, resuming the long-term uptrend. Gold remains in strong demand from central banks and investors, supported by the Federal Reserve’s monetary policy easing and the escalation of local military conflicts. The decline in the US dollar against major currencies also contributed to Gold’s growth this week.

With US markets closed today for the Thanksgiving holiday, no macroeconomic data is expected to be released. Without major news, Gold may continue to strengthen moderately within the current technical framework.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

GBPUSD declines at the beginning of the week as the news lull ends

The British pound sterling is undergoing a correction after its recent rise and is trading at 1.2691, as the impact of the US dollar has returned in full force. Find out more in our analysis for 2 December 2024.

GBPUSD forecast: key trading points

• The GBPUSD pair rose briefly before pausing
• The extended US holidays provided support for the pound’s rise
• GBPUSD forecast for 2 December 2024: 1.2635 and 1.2763

Fundamental analysis

The GBPUSD rate has dropped to 1.2691.

At the end of last week, the GBP strengthened against the US dollar as overseas investors observed an extended Thanksgiving holiday. Trading volumes were low, but November proved to be highly volatile.

However, the pound’s November losses against the US dollar were less pronounced than the euro’s. The GBP’s resilience was supported by expectations of a more decisive monetary policy from the Bank of England and the threat of tariff complications from the new US administration. For the pound, the absence of news was indeed good news.

The GBPUSD forecast appears moderate.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

USDJPY resumes growth, but the yen will not retreat easily

The USDJPY pair rose to 150.06 on Tuesday. Despite sustained pressure, the Japanese yen remains resilient. Find out more in our analysis for 3 December 2024.

USDJPY forecast: key trading points

• The USDJPY pair recorded modest gains
• Investors remain optimistic about a December Bank of Japan interest rate hike
• USDJPY forecast for 3 December 2024: 150.70

Fundamental analysis

The USDJPY exchange rate rose to 150.06.

Despite local pressure from the US dollar, the yen remains close to a seven-week high. The optimism is attributed to expectations that the Bank of Japan will raise interest rates in December.

Last weekend, BoJ Governor Kazuo Ueda stated that further rate hikes were imminent as economic data aligned with expectations.

Investors currently assess the likelihood of a 25-basis-point rate hike this month at 60%, compared to no more than 50% last week.

The USDJPY forecast is neutral.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

 

[Vlad RF]

EURUSD remains in a consolidation phase, with crucial news ahead

The EURUSD pair is stable around the 1.0502 level. The market is conserving strength ahead of US statistics. More details in our analysis for 4 December 2024.

EURUSD forecast: key trading points

• The EURUSD pair remains in a consolidation phase
• Market participants are awaiting November US employment reports
• EURUSD forecast for 4 December 2024: 1.0628

Fundamental analysis

The EURUSD rate is hovering around 1.0502 in the middle of the week.

The primary currency pair has seen only modest movements in recent days. Political turmoil in France has already been priced in, but the market still seeks safe-haven assets, keeping the euro relatively low.

The release of US labour market data supported the US dollar. The number of job vacancies in the US increased moderately in October while layoffs decreased, which is a positive sign for the sector as a whole.

The market’s focus now shifts to the ADP private sector employment change data due on Wednesday and a large batch of employment statistics on Friday.

The EURUSD forecast remains moderate.

RoboForex Market Analysis & Forex Forecasts

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team