December 13th Daily Analysis
December 13th Daily Analysis
U.S. DOLLAR INDEX (USDX)
The dollar index fell 0.1% to below 105 points, with investors awaiting the U.S. consumer price index reading for November. While the data is expected to show that consumer inflation eased further in the month, any surprises to the upside could rattle markets with fears of more hawkish actions from the Fed.
Producer price index data for November also eased less than expected, heightening concerns over a strong CPI reading. While the Fed has signaled it will hike rates at a slower pace in 2023, officials also warned that stubborn inflation will invite more rate hikes, which could see borrowing costs peak at higher-than-expected levels.
The U.S. dollar index fell 0.27% to 104.53, after slipping 0.3% overnight. The daily chart’s overall trend remains negative and targets the support at 104.40. However, the technical indicators show fluctuations with a heavier selling pressure build-up.
Pivot Point: 104.90
S&P 500 (SPX500)
U.S. stock futures fell slightly during Monday’s evening trades after major benchmark averages bounced back from a negative week as investors prepare for key inflation data set to be released later in Tuesday’s session.
Ahead in Tuesday’s session, market participants will be closely following November’s consumer price index report amid slowing inflation and economic activity ahead of Wednesday’s Federal Reserve interest rate decision.
During Monday’s regular trading session, the Dow Jones Industrial Average gained 1.6% to 34,005, the S&P 500 gained 1.4% to 3,990.6, and the NASDAQ Composite raised 1.3% to 11,143.7.
Pivot Point: 4,000
SPOT GOLD (XAUUSD)
Gold prices hovered around a one-week low on Tuesday, while the dollar steadied as traders hesitated from making big bets ahead of key U.S. consumer inflation data. Experts expect the CPI figures to set the tone for U.S. monetary policy in the coming months.
Prices of the yellow metal fell sharply on Monday, unwinding some recent gains as traders locked in profits ahead of the highly-awaited reading. Spot gold was flat at $1,782.17 an ounce, while gold futures steadied around $1,793.10 an ounce.
The 4 hours and the daily chart show a high probability of continuing the uptrend despite the readings of the technical indicators. However, RSI and MACD show a probability of a slight drop to $1,765 per ounce.
Pivot Point: 1,795
WEST TEXAS CRUDE (USOUSD)
Oil extended gains on Tuesday as a key pipeline bringing the resource to the United States remained shut, adding to concerns about potential tight supply in the world’s biggest crude consumer.
Additionally, concerns about Russian oil output have arisen since President Vladimir Putin said on Friday that Russia could cut production.
Brent crude futures rose 1.5% to $79.15 per barrel, while U.S. West Texas Intermediate (WTI) crude futures gained 1.4% to $74.22.
WTI’s overall trend remains negative and is heading toward $66 per barrel on the daily chart. Technical indicators show a continuation of the downtrend. Furthermore, the hourly chart is also negative and there is no support level strong enough to hold against the rising pressure from the longer time frames.
Pivot Point: 74.30