In the early trading sessions of last week, the US dollar maintained its strength, even though economic data released from the United States fell short of expectations. The durable goods orders for November showed a decline of -1.1%, significantly worse than the Trading Central forecast of -0.2% and the previous month’s increase of 0.8%.
Moreover, consumer sentiment for this month was reported at 104.7, a drop from November’s 112.8 and below the Trading Central forecast of 112.4.
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These releases are likely to impact market movements during the European trading session on Tuesday (December 24, 2024).
GOLD
Gold prices (XAUUSD) fell by over $10 or 100 pips, settling at $2,612.89 per troy ounce. The price had previously risen to around $2,633 per troy ounce before reversing direction.
The strengthening US dollar has applied pressure on gold prices. However, given that US economic data has been weaker than anticipated, expectations that the Federal Reserve might lower interest rates more than twice next year are growing stronger.
This suggests that the US dollar may face further pressure, potentially creating a positive sentiment for gold.
OIL
Oil prices (CSL10) remained stable at $69.54 per barrel at the beginning of last week’s trading after experiencing significant volatility.
The anticipated weak demand for oil next year continues to loom, making it hard for prices to rise significantly. This sentiment may exert downward pressure on oil during today’s European trading session.
EURUSD
The EURUSD pair dropped by 218 points (21.8 pips) during trading on Monday, reaching 1.04062. This decline was spurred by comments from European Central Bank (ECB) President Christine Lagarde, who indicated that the bank is nearing its medium-term inflation target.
Such remarks reinforced expectations for aggressive interest rate cuts by the ECB next year, leading to negative sentiment for EURUSD, which is expected to linger in today’s European trading session.
GBPUSD
The GBPUSD pair fell by 293 points (29.3 pips) to 1.25353 at the beginning of last week’s trading, approaching a seven-month low.
As previously mentioned, the US dollar has shown resilience despite weaker-than-expected US data. Consequently, there is potential for GBPUSD to experience positive sentiment in the upcoming European trading session.
USDJPY
The USDJPY pair saw an increase of 720 points (72 pips), reaching 157.162 during the early trading of last week. This currency pair is nearing a five-month high.
USDJPY has experienced high volatility, and with US economic data falling short of forecasts, a reversal to downward trends for USDJPY is still a possibility.
Nasdaq
The Nasdaq composite index rose by 185 points on Monday, reaching 21,737. The movement of Nasdaq has also been quite volatile.
The release of US economic data maintains expectations that the Fed might cut interest rates more than twice next year, contributing to a positive outlook for Nasdaq, which is likely to be felt in today’s European trading session.
