Wonderful introduction:
A secluded path, with its twists and turns, will always arouse a refreshing yearning; a huge wave will make a thrilling sound when the tide rises and falls; a story, regretful and sad, only has the desolation of the heart; a life, with ups and downs, becomes shockingly heroic.
Hello everyone, today XM Forex will bring you "[XM Foreign Exchange Market Analysis]: A collection of good and bad news affecting the foreign exchange market". Hope this helps you! The original content is as follows:
On November 24, the foreign exchange market will usher in a pattern of intertwined news. Repeated Fed policy expectations, divergence of Eurozone economic data and geo-risk disturbances have become core variables. This article sorts out the key news affecting major currency pairs such as the euro, pound, and yen from the two dimensions of being good for non-U.S. currencies and being good for the U.S. dollar. It www.xmxmxm.cnbines institutional interpretations to clarify the core concerns of traders and help seize opportunities for market fluctuations.
1. The core inflation in the Eurozone is approaching the target, and the European Central Bank's policy has turned to expected cooling. The latest data from Eurostat showed that the euro zone’s core harmonized CPI increased by 2.4% year-on-year in October, continuing to fall from 2.6% in September and getting closer to the European Central Bank’s 2% policy target. More importantly, core services inflation fell from 3.2% to 3.0%, indicating that the stickiness of inflation continues to weaken. European Central Bank Governing Council member Villeroy said that the current downward trend in inflation is clear and there is no need to be overly easing. The market's expected probability of an ECB interest rate cut in December has dropped from 48% to 35%, and the support for euro interest rates has increased.
2. British inflation exceeded expectations, and the Bank of England’s interest rate cut was postponed. Data from the British Office for National Statistics showed that British CPI increased by 4.6% year-on-year in October, which was lower than September but higher than market expectations of 4.5%. Core CPI increased by 5.7% year-on-year, also exceeding expectations. This data directly changed the market's policy prediction of the Bank of England. The probability of an interest rate cut in the first quarter of 2026 dropped from 70% to 42%. The pound's short-term interest rate jumped 10 basis points, and the pound/dollar exchange rate gained support. Institutions predict that it is expected to test the 1.25 mark in the short term.
3.ChinaEconomic data picked up, and www.xmxmxm.cnmodity currencies received support from demand. China's preliminary manufacturing PMI value in November was recorded at 50.8, an increase of 0.3 percentage points from October, and it has been in the expansion range for two consecutive months; in October import data, imports of copper ore and iron ore increased by 5.2% and 3.1% month-on-month respectively. As the main export destination of Australia and Canada, the recovery in demand in China directly boosted the exchange rates of the Australian dollar and the Canadian dollar. The Australian dollar/US dollar stood at 0.655 in the short term, and the US dollar/Canadian dollar fell back below 1.36.
1. Federal Reserve officials have released intensive hawkish signals, and expectations of interest rate cuts have cooled down again. In his speech on November 23, Dallas Fed President Kaplan emphasized that the current U.S. core PCE is still above the 2% target, and the resilience of the labor market has not diminished. It is not appropriate to rush to cut interest rates in December, and more evidence of a fall in inflation needs to be observed. On the same day, Cleveland Fed President Mester also said that policy rates need to remain at restrictive levels for longer. CME's "Fed Watch" tool shows that the probability of a 25 basis point interest rate cut in December has dropped from 55% to 48%, and the U.S. dollar index has been supported above 103.5.
2. The U.S. economic data is relatively strong and its growth advantage is highlighted. U.S. durable goods orders increased by 1.3% month-on-month in October, far exceeding the expected 0.8%, and core capital goods orders increased by 0.6%, indicating a rebound in corporate investment willingness; the final value of the University of Michigan Consumer Confidence Index rose to 61.3 in November, an increase of 1.2 percentage points from the initial value. www.xmxmxm.cnpared with the economic weakness of the Eurozone and the United Kingdom, the economic resilience of the United States has further strengthened the dual attributes of the US dollar as a "safe haven + income." Fund flow monitoring shows that the www.xmxmxm.cn inflow of ETF funds related to the US dollar index in the past three trading days exceeded US$1.2 billion.
3. As geopolitical risks heat up, safe-haven funds flow to the U.S. dollar. The situation in the Middle East has escalated again. Israel has launched a new round of air strikes against Hezbollah targets in Lebanon. The risk of oil tanker navigation in the Persian Gulf has increased. At the same time, drone attacks have increased in the Russia-Ukraine conflict, and global risk aversion has increased slightly. As a traditional safe-haven currency, the U.S. dollar is favored by funds. Safe-haven currency pairs such as USD/JPY and USD/CHF are showing an upward trend, with USD/JPY approaching the key mark of 152.
Today there are three major time points to focus on: Germany’s November IFO business climate index released at 15:00. If the data improves, it may boost the euro; 20:30 US October core PCE price index, which is the Fed’s most important inflation indicator. If it is higher than expected, it will further suppress interest rate cut expectations; 22:00 Fed Chairman Powell’s speech, his statement will directly dominate the short-term trend of the US dollar.
In terms of operation, the EUR/USD can rely on the support of 1.082 to test long positions, with a stop loss of 1.079 and a target of 1.088; the GBP/USD will pay attention to the breakthrough of the 1.245 resistance level, and can take advantage of the trend to add positions after it stabilizes; the USD/JPY needs to be wary of the risk of intervention by the Bank of Japan, and avoid pursuing long positions near the 152 mark. At the same time, today coincides with America’s Thanksgiving DayOn the eve of the holiday, market liquidity may shrink in advance, and positions need to be strictly controlled to avoid risks caused by late-day fluctuations.
The above content is all about "[XM Foreign Exchange Market Analysis]: Collection of good and bad news affecting the foreign exchange market". It is carefully www.xmxmxm.cnpiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
After doing something, there will always be experiences and lessons learned. In order to facilitate future work, the experience and lessons from past work must be analyzed, researched, summarized, concentrated, and understood at a theoretical level.