• US November non-farm payrolls +199K vs +180K expected
• US December UMich consumer sentiment 69.4 vs 62.0 expected
• US in talks with Gulf allies on military action against Yemen Houthis — report
• Baker Hughes US oil rig count -2

Markets:

• Gold down $26 to $2002
• WTI crude up $1.82 to $71.16
• US 10-year yields up 10.6 bps to 4.23%
• S&P 500 up 0.5% to a 52-week high
• CAD leads, NZD lags

It’s often said that even if you knew the results of the non-farm payrolls report ahead of time, it would be tough to make money. That was the case today as price action was extremely volatile in the aftermath of the report.

EUR/USD dropped to 1.0725 on the headlines, in a 50-pip drop in the direction you would expect due to a surprise drop in unemployment and slightly better headline jobs and wage growth. However that was erased in minutes and it was similar elsewhere. Then the dollar heated up again and made new highs on a few fronts, though not EUR/USD where it fell just short at 1.0731 but that certainly wasn’t it as the same pattern played out again over the following few hours, leaving both sides of the trade searching for answers.

The yen trade was particularly nasty as the first jump in the dollar appeared to attract those looking for exit liquidity and the pair was smashed 140 pips from the highs. A second round of bids emerged in a rally to 144.75 from 143.75 but again was beaten back into the London fix. A third round of bids eventually helped the pair to 145.00 as Treasury yields rose.

Mixed in was a UMich consumer sentiment report. The strong headline wasn’t the real story though as both short and long-term inflation metrics dropped, adding to the disinflation narrative that’s percolating.

US equities were slated to open softer but found bids early and that continued throughout the day as stocks posted a sixth week of gains.

The week ahead will build up to the Fed and ECB rate decisions, along with some important Treasury auctions. Have a great weekend.

This article was written by Adam Button at www.forexlive.com.

Sentiment in oil might finally be so washed out that it’s safe to wade in.

The US announced another 3 million barrels of purchases to refill the SPR today and that’s a modest positive catalyst as the White House is able to refill it at prices below what they paid. I’d argue that’s just more inventory down the line to keep oil below $100 but the oil bulls will take what they can get.

In the latest rout in oil, I wonder how many pair trades were involved with oil and bonds. Crude makes a great inflation hedge and with oil prices declining and bonds rallying, you wonder how many of those trades are being unwound.

Technically, there isn’t much to love here but there is some support in the $66-68 range, which equates to a positive risk-reward if you think OPEC+ can tighten the market in Q1 and US producers finally slow down. I don’t hate that trade but I would rather be late than early.

This article was written by Adam Button at www.forexlive.com.

The price of WTI crude oil futures are settling the week at $71.23. That’s up $1.89 or 2.73%. Monday, Tuesday and Wednesday saw the price tumble from Friday’s close of $74.07 to a low-price reached yesterday (before rebounding) at $68.80. The rebound today retraced some of the declines. However, for the week, the price is still down -2.58%.

Although sharply lower, there is some hope for the buyers. Technically looking at the weekly chart above, the price fell below its 200-week moving average for the first time since early May at $70.31 during yesterday’s fall. Today the price has rebounded back above that long term moving average. Closing back above the MA gives dip buyers some hope. Moreover, it is now a level that traders can once again lean against in trading going forward. As long as the price remains above, there is hope for further upside corrective probing.

Drilling to the hourly chart below, the rise today stalled near its 100-hour moving average. For dip buyers, if the price can get and stay above the 100-day moving average, the hope for more corrective price probing toward $72.63 (swing area), $72.93 (38.2% retracement) and the falling 200-hour moving average (at $73.81) are the next upside targets.

Note: If the price were to close below the 200-week moving average it would have been the first close below that moving average since January 2021. Although the price fell below the 200-week moving average in March and again in May, it could not close below that moving average level

This article was written by Greg Michalowski at www.forexlive.com.

The USDCHF has moved higher this week. The low was reached on Monday. The high was reached in trading today. At session highs, the price reached the low of a swing area on the daily chart between 0.88167 and 0.8838. In trading next week, if the buyers are to take more control they would need to get above 0.8838 level.

Drilling down to the hourly chart below, the 38.2% retracement of the move down from the end of October high to the December 1 low comes in at 0.8836 just two pips lower than the 0.8838 target on the daily chart. The same resistance target near 0.8838 on both the daily and the hourly chart increases at levels importance, and makes it a key barometer going into the new trading week.

So traders next week will have a choice.

• Do they go higher above the 0.8838 level and extend toward higher targets including the 100-day moving average?

OR

• Is the 0.8838 level a resistance target that attracts new dollar sellers and leads to a resumption of the most recent downward trend in the USDCHF?

That is what will be decided next week near the 0.8838 level.

For a detailed look at the charts defining these levels, watch the video above. Be aware. Be prepared.

This article was written by Greg Michalowski at www.forexlive.com.

A strong and decent enough non-farm payrolls print but perhaps a tick higher in the unemployment rate. That seems to be the growing consensus going into the US jobs report later and that would give markets plenty to think about. The former is likely the case after the resolution of the UAW strikes while the latter is a sign of softening in labour market conditions as the economy slows down.

So, what will that tell us if we do see things play out this way?

All else being equal, that should reaffirm that the Fed is done with rate hikes. The wage numbers are also expected to come in at 4.0% year-on-year, the smallest annual growth since the middle of 2021. So, that should rebuff the narrative that we’re navigating towards a soft landing with gradually declining price pressures.

In other words, markets can find reason to cheer on a mixed report with the dollar potentially struggling in the aftermath and risk trades ripping higher once again. Just some food for thought.

Here’s a quick snapshot on the expectations and estimates going into the report today: Preview: November non-farm payrolls by the numbers

This article was written by Justin Low at www.forexlive.com.

Forex trading can be an extremely profitable venture, but it is also true
that a significant percentage of traders fail to achieve consistent success in
this market. Why do forex traders fail? There are several common reasons that
contribute to their lack of success. Let’s explore some of these reasons:

Lack of Proper Education and Knowledge

One of the primary reasons why many forex traders fail is their lack of proper education and knowledge about
the market. Forex trading is not as simple as it may initially seem; it
requires a deep understanding of various factors that influence currency
movements such as economic indicators, political events, and global market
trends. Without a solid foundation of knowledge and education, traders are more
likely to make mistakes that lead to losses.

Poor Risk Management

Another crucial factor contributing to forex trading
failures is poor risk management. Many traders enter trades without adequately
considering the potential risks involved. They may trade with too much
leverage, risking a significant portion of their account on a single trade.
This lack of risk management can quickly lead to substantial losses and
ultimately wipe out their trading capital.

Emotional Decision Making

Emotional decision making often proves to be the downfall of
many forex traders. The volatility of the forex market can evoke strong
emotions such as fear and greed, which can cloud judgment and lead to impulsive
and irrational trading decisions. Emotion-driven trades rarely end well and can
result in significant losses.

Lack of Discipline

Successful forex trading requires discipline and adherence
to a well-defined trading plan. However, many traders fail to develop or stick
to a trading plan. They may deviate from their strategies, chase after quick
profits, or make impulsive trades based on short-term market fluctuations.
Without discipline, it becomes challenging to maintain consistency in trading,
leading to poor results.

Overtrading

Overtrading is another common mistake made by forex traders.
Some traders become addicted to the thrill of trading and feel compelled to be
constantly in the market. This leads to excessive trading, taking trades that
do not meet their criteria, and increasing the risk of losses. Overtrading can
also result from a lack of patience and discipline.

Inability to Adapt to Changing Market Conditions

The forex market is highly dynamic and subject to constant
changes. Traders who fail to adapt to changing market conditions are likely to
struggle. Markets can shift rapidly due to economic news, geopolitical events,
or shifts in investor sentiment. Traders need to adjust their strategies and
approaches accordingly to stay ahead. Those who fail to do so often find
themselves out of sync with the market and unable to generate consistent
profits.

In conclusion, there are several reasons why forex traders
fail, including a lack of proper education, poor risk management, emotional
decision making, a lack of discipline, overtrading, and an inability to adapt
to changing market conditions. To improve their chances of success, traders
must invest in their education, develop effective risk management strategies,
control their emotions, maintain discipline, trade selectively rather than
impulsively, and continuously adapt to market dynamics.

This article was written by FL Contributors at www.forexlive.com.

CFDs, or Contracts for Difference, are a type of derivative
financial product that allow traders to speculate on the price movements of
various underlying assets without owning the assets themselves. While CFD trading offers certain advantages, it also presents risks and
drawbacks. In this article, we will explore the pros and cons of trading CFDs.

Pros:

1. Leverage: One of the primary benefits of CFD trading is the availability of leverage. With leverage,
   traders can control larger positions with a smaller amount of capital.
   This means that potential profits can be magnified, leading to higher
   returns on investment. However, it is important to note that leverage can
   amplify losses as well, so caution must be exercised.
2. Access to Multiple Markets: CFDs offer access to a range of markets, including
   stocks, indices, commodities, and currencies. This provides traders with a
   wide variety of trading opportunities and the ability to diversify their
   portfolios. Moreover, CFDs allow traders to take both long and short
   positions, enabling them to profit from both rising and falling markets.
3. Flexibility: CFDs offer flexibility in terms of trading
   strategies. Traders can choose from a variety of order types, such as
   stop-loss and take-profit orders, to manage risk and lock in profits.
   Additionally, CFDs can be traded on margin, allowing traders to hold multiple
   positions simultaneously and potentially increase their overall market
   exposure.
4. No Ownership Required: Unlike traditional investing, CFD traders do not need
   to own the underlying assets they are trading. This eliminates the need
   for physical delivery or storage of assets, making CFD trading more
   convenient and cost-effective.
5. Availability of Information: CFD traders have access to an abundance of market
   information and analysis tools. Many trading platforms provide real-time
   data, charts, and technical indicators to help traders make informed
   decisions. This wealth of information can be invaluable in identifying
   trading opportunities and managing risk.

Cons:

1. Leverage Risks: While leverage can amplify profits, it can also
   magnify losses. If a trade moves against a trader, they may face
   substantial losses that exceed their initial investment. It is crucial to
   use leverage judiciously and employ risk management strategies to protect
   capital.
2. Counterparty Risk: CFD trades are typically executed through a broker
   who acts as the counterparty to the trade. This means that traders are
   exposed to the credit risk of the broker. In the event of a broker’s
   insolvency, traders may suffer financial losses. To mitigate this risk, it
   is important to select reputable and regulated brokers.
3. Complexity: CFD trading can be complex, especially for
   inexperienced traders. Understanding the intricacies of margin
   requirements, rollover costs, and contract specifications requires a
   thorough knowledge of the market and trading mechanics. Lack of
   understanding can lead to costly mistakes.
4. High Volatility: The markets in which CFDs are traded can be highly
   volatile. Rapid price movements can result in significant gains, but they
   can also trigger unexpected losses. Traders must be prepared for market
   volatility and have appropriate risk management strategies in place.
5. Overtrading Risk: Due to the ease and accessibility of CFD trading,
   there is a risk of overtrading. Overtrading can lead to emotional
   decision-making and impulsive trades, which can be detrimental to
   profitability. Traders should exercise discipline and adhere to well-defined
   trading plans.

In conclusion, CFD trading offers several advantages,
including leverage, access to multiple markets, flexibility, no ownership
requirements, and availability of information. However, it is essential to be
aware of the risks associated with leverage, counterparty risk, complexity,
high volatility, and overtrading. Like any form of trading or investment, CFD
trading requires careful consideration and risk management to maximize
potential gains while minimizing potential losses.

This article was written by FL Contributors at www.forexlive.com.

📈🚀 Exploring S&P 500 E-Mini Futures – Next Key Levels & All-Time High Insights 🚀📈

Hello, Traders and Market Enthusiasts! 🌟 Join us as we delve into the dynamic world of the S&P 500 E-Mini Futures (ES), a crucial indicator of the overall stock market with this ES technical analysis video. 📊

🎢 Key Levels to Watch – What’s Next?

• Focus on 4685 & 4711: Understanding the importance of these levels in the current market context. 🎯
• 4685 Level: The Price Control (PC) of the previous area, a crucial juncture for market direction. 🔄
• 4711 Level: Value Area High (VAH) of the previous period, indicating potential resistance or support. 📉📈
• Future Scenarios: Analyzing potential market movements around these levels and how they may shape future trends. 🕵️‍♂️

🔵 Inside the Analysis:

• Dive into the S&P 500 E-Mini Futures and its reflection of the stock market. 📊
• Key insights into recent market movements and their implications. 🧐
• Contract rollovers and their impact on market trends. ⏩

🔴 Highlights of the the ES technical analysis video above:

• Breakdown of the current all-time high on ES at 4882.5. 🏆
• Overhead potential resistance and value area highs in focus. 📉
• Weekly and monthly chart analysis for comprehensive market understanding. 🗓️

💡 Further Insights:

• Detailed look at the effect of contract rollovers on market dynamics. 🔄
• Exploring the significance of key resistance levels. 🎯
• Possible scenarios of double tops and their market implications. 🔄

🔔 Stay Ahead with ForexLive:

• Keep updated with the latest market trends and analyses at www.forexlive.com. 👀
• Real-time updates and expert opinions for informed trading decisions. 💻

📉📈 Disclaimer:

• Trade and invest at your own risk. Conduct thorough research and consult professionals. 🛑

This article was written by Itai Levitan at www.forexlive.com.

There are quite a number of things to note in this report here by Reuters. The first is one of the sources stating that „there was no intention to signal anything about the timing of a policy change“ amid remarks from BOJ governor Ueda yesterday. Adding that his comments were taken out of context by markets and was not meant to signal an imminent policy shift.

Then, the sources also claim that recent weakness in consumption has emerged as a point of concern for the central bank in trying to take that step to normalise policy. This is mainly due to the fact that firms could start cutting prices again in response to weakened domestic demand.

And the final thing to note is that the sources say that while the BOJ is eyeing an exit from ultra easy policy, „an early exit will be out the window“. The central bank will instead stick with the status quo „until this positive wage-inflation cycle kicks off“.

That’s probably one reason why the Japanese yen has been relatively tame in trading today, even trading down 0.2% against the dollar at 144.38 at the moment. The chart still points to USD/JPY sellers staying in control though, after long positions have been squeezed hard in trading yesterday.

This article was written by Justin Low at www.forexlive.com.

The discussions are said to have moved to sorting out the key technical details, in a sign that the SEC may soon approve Bitcoin ETFs. That being said, there are still sticking points namely whether issuers will create a cash or an „in-kind“ settlement mechanism, the sources said.

For now, the SEC has declined to comment publicly on the matter as you would expect. But as can be seen from the optimism in Bitcoin as of late, there is growing hope of a positive outcome priced in already.

This article was written by Justin Low at www.forexlive.com.