This short
week is almost over. The U.S. is celebrating Thanksgiving Day, but traders will
return for a short day to trade fresh PMI data in the United States.
PMIs in Eurozone
and in the United Kingdom went up in November. British service sector climbed
above 50 points barrier, which is a watershed between contraction and
expansion, to 50.5 points. The U.S. data might be even better to push the U.S.
Dollar up, although Wall Street analysts expect PMI to be worse than the
previous data.
After a
short return investors will go for a weekend to think about a four-day ceasefire
between Israel and Hamas, and about the delay of the Organization of the
Petroleum Exporting countries and its allies (OPEC+) meeting, which is moved to
November 30. Are these two episodes connected? Rumours say that Nigeria and
Angola are against another oil production cuts. But, there could be other
reasons for a delay. Besides, the meeting is rescheduled to online format. Last
time this happened was in March 2020 with prices plummeting by 54% within one
month after the meeting.
This is particularly
nervous due to a reversal opportunities of the stock market that would emerge
next week. A decline of the stock market would not necessarily manifest the
decline of crude prices, but such a coincidence of the S&P 500 broad market
index return to 4580 points to close the gap is worrying. Technically, the fate
of the Christmas rally would be decided next week. A positive scenario suggest
that the index may climb to 4800-4900 points, while the negative scenario would
suggest a reversal and a possible huge drop to the downside.
There should
be an import reasons for both scenarios to come into reality. But, there are
none. From the macroeconomic side there will be publications of Q3 GDP, PCE Price
Index in the United Sates and a speech of the Federal Reserve’s (Fed) Chief
Jerome Powell. GDP data is certainly not a reason for a move, PCE Index is
likely to slow down following PCI data that was released earlier considering
weak October data. Powell is unlikely to deliver something extraordinary to
stumble stocks. Anyway, investors will have no time to react dramatically on
his statements. Thus, investors are more worried about possible force majeure issues
that may emerge over the weekend and next week. If there will be none the
chances for a Christmas rally will rise significantly.
Brent crude
prices are viciously consolidating below the resistance of $83.00-85.00 per barrel.
The nearest support is at $74.00-76.00 per barrel. This is the downside target
for prices in case they will fail to climb above the resistance. This week opened
a period for a possible upside for crude prices.
Gold prices
are moving inside the mid-term upside formation with targets at $2000-2100 per
troy ounce that have already been met. Prices have not properly tested the
support at $1910-1930 per ounce, and bounced towards the resistance at
$1990-2010 per ounce. They hit the lower margin of this zone and are hovering
just around it. A breakthrough of this resistance may push prices to $2100 per
ounce. Otherwise, a war premium is seen deflating with prices slowly moving
down towards the $1830 per ounce mark.
The
Greenback reached its primary correction targets at 1.08500-1.09500 against the
Euro. Any further correction is largely associated with a Christmas stock
rally. Alternatively, the Greenback could resume is strengthening towards the
parity with the single currency.