Market Brief Series / EP. 459 / 5th Dec. 2018

• Overall there is strength in the JPY, with minor strength in the USD and CHF. Weakness in the CAD, AUD, with minor weakness in EUR, NZD, and GBP.

• USD recouped losses seen earlier in the session, with ICE Dollar Index marking a day-low at 96.38 before bouncing back to close at 96.96, down 0.1% on day. Sentiment was dampened by Trump’s comments which added to uncertainty on the trade war with China. Meanwhile, 2-year US Treasury yield rose above 5-year yield for the first time since the financial crisis. The yield curve inversion raised investors’ concerns about a potential recession.

• Oil prices slumped by around 2 percent on Wednesday, pulled down by swelling U.S. inventories and a plunge in global stock markets as China's government warned of increasing economic headwinds.

• Gold's pullback from yesterday's high of $1,242 has stalled at the ascending 50-hour moving average (MA) support of $1,234.

• AUD/USD fell more than 50 pips earlier today after the ABS reported a sharp slowdown in Australia's growth rate in the September quarter.

• USD/JPY faces downside pressure heading into Wednesday's early session, with moves into the upside getting pressured by downside resistance from the 113.00 handle.

• EUR/USD pair is holding on the downside after yesterday’s downward acceleration, below 1.1365, look for a drop with targets at 1.1315 and 1.1280. Alternatively, breaking above 1.1365 would bring a rebound with 1.1380 and 1.1410 as targets.

• On the data slate there’s Euro-Zone Non-Monetary Policy’s ECB Meeting; UK FPC Statement; Euro-Zone ECB President Draghi’s Speech; German Services and Composite PMI; Euro-Zone Services and Composite PMI; UK Services PMI; Euro-Zone Retail Sales; US Mortgage Applications; US Fed’s Quarles Speech and US Fed’s Beige Book.

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