AUDUSD TECHS: Trend Outlook Remains Bearish

BBDXY still below Friday’s highs & closing levels, with a modest move lower in U.S. yields noted.

• All of the major USD pairs sit within 0.3% of Friday’s closing levels.
• NZD outperforms G10 FX peers.
• NZD/USD a little over 25 pips off Friday’s ’24 low, last 0.5781.
• That is despite domestic monthly inflation data being consistent with further RBNZ easing & NZ PM Luxon highlighting the very challenging economic conditions in place at the moment.
• Weakness in Chinese equities & retail sales data outwound some of AUD’s early outperformance.
• Questions surrounding the durability of any Chinese economic recovery remain evident following the latest round of economic data.
• USD/JPY little changed around 153.65, lower Tsy yields, an uptick in e-minis and the downtick in Chinese stocks offset when it comes to that pair.
• NOK the G10 underperformer (excl. USD) given the move lower in European equity index futures and crude oil.
• Looking ahead, December flash PMIs headline the global data calendar on Monday. We will also see Eurozone Q3 labour cost data
• There will be a raft of ECB speak (recent comments from Lagarde have simply reiterated last week’s post-meeting comments) and comments from BoC Governor Macklem.
• The Fed remains in pre-meeting blackout. Click for our preview of that event: https://media.marketnews.com/Fed_Prev_Dec2024_c2bc263e41.pdf

• RES 4: $2790.1 - High Oct 31 and the bull trigger  
• RES 3: $2750.0 - High Nov 5
• RES 2: $2730.4 - 76.4% retracement of the Oct 31 - Nov 14 bear leg     
• RES 1: $2726.2 - High Dec 12     
• PRICE: $2654.9 @ 07:23 GMT Dec 16 
• SUP 1: $2643.6 - Intraday low  
• SUP 2: $2605.3/2564.4 - Low Nov 26 / 18
• SUP 3: $2536.9 - Low Nov 14 and a key support 
• SUP 4: $2511.1 - Low Sep 12  

Gold has pulled back from its recent highs. Trend signals remain bullish and a move lower is considered corrective. A key short-term resistance at $2721.4, the Nov 25 high, has been pierced and this represents a positive development. A continuation higher would expose key resistance at $2790.1, the Oct 31 high. Clearance of this level would confirm a resumption of the primary uptrend. First key support is $2605.3, the Nov 26 low.

• RES 4: 124.00 Round number resistance    
• RES 3: 123.83 1.764 proj of the Nov 7 - 15 - 18 price swing
• RES 2: 123.43 1.618 proj of the Nov 7 - 15 - 18 price swing 
• RES 1: 122.85/123.34 High Dec 12 / 11 and the bull trigger  
• PRICE: 121.33 @ Close Dec 13 
• SUP 1: 121.07 38.2% retracement of the Nov 7 - Dec 11 bull cycle       
• SUP 2: 120.37 50.0% retracement of the Nov 7 - Dec 11 bull cycle    
• SUP 3: 119.67 61.8% retracement of the Nov 7 - Dec 11 bull cycle 
• SUP 4: 119.11 Low Nov 18    

BTP futures remain in a bull cycle, however, a corrective cycle has resulted in a move lower and last week’s sell-off signals potential for an extension near-term. The contract has breached the 20-day EMA and this  open 121.07, a Fibonacci retracement. Key resistance and the bull trigger has been defined at 123.34, the Dec 11 high. A breach of this level would confirm a resumption of the recent uptrend.