US Dollar retook the crown and oil price plummeted with OEPC’s decision

December 1, 2014

The oil price slump continued last Friday, as US traders joined the sell side after Thanksgiving Day. WTI hit $66, a new low since September 2009, pushing down the prices of other commodities and related currencies like Australian Dollar and Canadian Dollar.

After Aussie Dollar left a long-upper-shadow doji candle on Thursday, it continuously fell and closed at 0.85 mark, a step away from a new low since 2010. If the 0.85 support gets broken, we may see the pair fall to an area around 0.8160.

Gold experienced biggest fall in the last three weeks as it slumped by almost 2% to $1167 per ounce last Friday. The $1180 level was once again broken under the background of oil slump and a stronger Dollar. The weekend news about Swiss gold vote that seemed to have been declined by most voters crossed off another bullish reason for gold. We may see a big fall today. Currently the price is moving within the bearish channel. The former low $1132 may be reached soon.

As we mentioned last week, as long as the Euro Dollar does not reverse the loss of its last slump, the rebound of last week will be just a correction. And now, as we see a bearish reversal sign on the daily chart, we can assume the decline of Euro has restarted and a fresh low is closing. The last ECB meeting of this year will be held this Thursday, but the breakout may happen before the meeting.

With the carnival of China market continuing, Asian stock markets seem to be mixed. The Shanghai Composite surged 1.99% to 2683. ASX 200, in contract, slumped 1.63% to 5313. In the European stock markets, the UK FTSE closed flat, the German DAX rose 0.06% and the French CAC Index gained 0.2%. The US market inched higher as consumer shares rallied on oil slump. The S&P 500 lost 0.25% to 2067. The Dow closed flat at 17828, and the Nasdaq Composite Index rose 0.09% to 4791.

PMI day today. China official and HSBC Manufacturing PMI will be released at noon, while Euro area and UK PMIs are the main data in European session. Also, US ISM Manufacturing PMI will be released at 2:00 ASDST.

Have a great trading day!

Anthony


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