The Week Ahead 20th – 24 November: Awaiting FOMC minutes

<p>Welcome to Key To Markets preview of the Week Ahead</p>
<h2>Currency Pair Performance</h2>
<p>5-day performance as of <strong>November 16, 2023. 11:00 GMT</strong></p>
<p><img decoding="async" fetchpriority="high" class="alignnone wp-image-27084 size-full" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Currency-Performance.png" alt="" width="609" height="291" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Currency-Performance.png 609w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Currency-Performance-300×143.png 300w" sizes="(max-width: 609px) 100vw, 609px" /></p>
<p>Source: finviz.com</p>
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<h2>10 Big Stories Last Week</h2>
<p>In case you missed it…</p>
<p><strong>US inflation cooled to 3.2%.</strong> This was below forecasts of 3.3% and fuels bets that the Fed is done hiking rates and could look to cut rates in early H2 2024. USD fells to a 2.5-month low.</p>
<p><strong>Target jumped 17% after earnings.</strong> The retailer beat estimates on both the top and bottom line as purchases of high-frequency items like food and beauty offset weakness in larger discretionary items.</p>
<p><strong>UK inflation eased to a 2-year low.</strong> UK CPI cooled by 2.1% to 4.6%, marking the largest decline in inflation since 1992 as energy prices fell.</p>
<p><strong>President Biden and China’s Xi Jinping met.</strong> The two leaders met for the first time in a year and hailed progress in talks, but Taiwan remains a sticking point.</p>
<p><strong>Nasdaq100 rises to a 4-month high.</strong> The tech and growth stock heavy index surged to within a breath of 16000, the July high, on bets that the Fed is done hiking rates.</p>
<p><strong>Chinese retail sales and industrial output beat forecasts.</strong> Retail sales rose 7.6% from 5.5%, and industrial production rose 4.6%, its fastest growth since April.</p>
<p><strong>Microsoft announced a custom AI chip.</strong> The tech giant unveiled its first chip for AI along with an ARM-based chip for general-purpose computing. Both will come to Microsoft’s Azure.</p>
<p><strong>US Senate passed a stop-gap spending measure.</strong> The US Senate voted in favour of the plan, likely avoiding a partial government shutdown.</p>
<p><strong>BTC/USD rose to 38k.</strong> The cryptocurrency rallied to an 18-month high on optimism that spot Bitcoin ETF would be approved soon.</p>
<p><strong>Nvidia unveiled its H200 chip</strong>. This is its newest high-end chip designed for training the AI models that are powering the generative AI boom.</p>
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<h2>Chart of the Week</h2>
<p><img decoding="async" class="alignnone wp-image-27127 size-full" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Picture-1.png" alt="" width="904" height="424" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Picture-1.png 904w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Picture-1-300×141.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Picture-1-768×360.png 768w" sizes="(max-width: 904px) 100vw, 904px" /></p>
<p>Cathie Woods, the head of ARK Investment Management, said that she believes that deflation will take hold in the US next years and will force the Federal Reserve to kick off a big interest rate-cutting cycle.</p>
<p>Her prediction comes after US CPI cooled by more than expected to 3.2% YoY and clashes with the consensus on Wall Street, where economists see inflation cooling to 2.7% next year.</p>
<p>Following the CPI data, bets on further Fed rate hikes evaporated, and traders pulled forward the first Fed rate cut to June.</p>
<p>A more dovish Fed could pull US treasury yields and the USD lower while boosting demand for stocks, particularly high-growth stocks.</p>
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<h2>5 Things to Watch This Week</h2>
<p><strong>1. FOMC minutes</strong><br />
The minutes of the November FOMC meeting will be released on Tuesday, November 21st. The minutes relate to the meeting where the Federal Reserve left interest rates on hold, and the market perceived Federal Reserve chair Jerome Powell to have adopted a more dovish tone. The minutes will shed more light on whether this was the case, particularly given that the week following the meeting, Fed officials seemed to push back on market expectations that the Fed was done with hiking rates. The market expects the Fed to leave interest rates on hold in the December meeting and a rate cut in June next year. The tone of the minutes could change these expectations.</p>
<p><strong>2. Eurozone PMI data</strong><br />
PMI data is set to be released on Thursday, November 23rd. October&#8217;s PMI figures showed that both the service and the manufacturing sectors contracted more than expected in the eurozone region, raising concerns about a recession in the final quarter of the year. Investors will not only be watching the headline figure but also the sub-sectors, which in October showed a sharp drop in new business orders, the first fall in employment in 2.5 years, and cooling price pressures.</p>
<p><strong>3. BoE MPC Hearing</strong><br />
Bank of England governor Andrew Bailey will be in front of the Treasury Select Committee and questioned over the central bank&#8217;s monetary policy decisions. The meeting comes after UK inflation cooled by more than expected to 4.6% in October, but wage growth remains stubbornly high. Any comments regarding the outlook for the UK economy and the future path of interest rates could influence the pound.</p>
<p><strong>4. Nvidia earnings</strong><br />
Nvidia is due to release Q3 earnings on November 21st. They come as the AI stocks’ share price trades 240% higher this year on upbeat earnings and strong guidance. All eyes will be on Nvidia&#8217;s AI and data center business; nothing else matters. Revenue is expected to rise by 170% to $16 billion, and EPS is forecasted at $3.34, representing a rise of 475% compared to a year earlier. Earnings come as Nvidia unveiled its highly anticipated H200 processing unit for training AI models and announced a series of io chips for Chinese customers complying with U.S. government export restrictions.</p>
<p><strong>5. US retailers</strong><br />
US retailers such as Target. Macy’s and Home Depot reported earnings last week, which were a mixed bag, and US retail sales fell for the first time in seven months as aggressive Fed rate hikes started to hit US consumers. This week, retailers remain in focus in the US holiday-shortened week ahead of the Black Friday and Cyber Monday shopping events. Lowe’s and Best Buy will report Q3 earnings on November 21st.</p>
<h2>Economic Calendar Highlights</h2>
<p><img decoding="async" class="alignnone size-full wp-image-27092" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Calendario.png" alt="" width="678" height="547" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Calendario.png 678w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Calendario-300×242.png 300w" sizes="(max-width: 678px) 100vw, 678px" /></p>
<p>Source: FXStreet.com</p>
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<h2>Technical Analysis:</h2>
<p>TA of the major asset classes (Forex &#8211; Commodities &#8211; Indices…).</p>
<p><strong>EUR/USD (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27095" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/EURUSD-Canva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>EUR/USD is in an uptrend forming higher highs and lows above the 50 SMA. RSI is overbought above 65. A massive bullish candle has shifted the price action from a bear flag consolidation to a new uptrend. Support is near the prior high at 1.075 with 1.092 the next major resistance.</p>
<p><strong>GBP/USD (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27098" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GBPUSD-Canva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>GBP/USD is at the start of a new uptrend, forming higher lows and highs and above the 50 SMA. RSI is bullish. Price broke out of its previous range with a test of the big 1.25 level, where there has been a slight correction. There is a risk of a false breakout but the bias is bullish while above the 50 SMA.</p>
<p><strong>USD/JPY (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27101" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/USDJPYCanva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>USD/JPY is in an uptrend, making higher highs and lows above the 50 SMA. RSI is neutral. Support is being held at 149 but price is yet to decisively break the 2022 (multi-year) peak at 151.8. A hanging man pattern on the weekly chart at a round number is bearish.</p>
<p><strong>Gold (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27104" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/GOLD-Canva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>XAU/USD is the correction of an uptrend, forming lower highs and lows above the 50 SMA. RSI is neutral. Price held broken resistance as support at 143 from the late August and September peaks and is now edging higher, with 1980 the near-term barrier.</p>
<p><strong>Brent Oil (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27107" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Brent-Canva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>&nbsp;</p>
<p>XBRENT is in a downtrend, making lower lows and highs below the 50 SMA. RSI is oversold under 35. The price has turned lower again after a brief correction ended at 84.0 with a subsequent drop back under 80. Once below 78 there is little technical support until 72.</p>
<p><strong>US500 (Daily Candlestick Chart)</strong></p>
<p><img decoding="async" loading="lazy" class="alignnone size-full wp-image-27110" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva.png" alt="" width="2556" height="1227" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva.png 2556w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva-1024×492.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva-768×369.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva-1536×737.png 1536w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/US500-Canva-2048×983.png 2048w" sizes="(max-width: 2556px) 100vw, 2556px" /></p>
<p>XUS500 is in an uptrend making higher highs and lows above the 50 SMA. RSI is overbought. Price extended its bullish run above 4500 and is testing resistance from the September highs at 4520 with 4600 next resistance.</p>
<p>Thank you very much for reading – and have a great week trading!</p>
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<p>The post <a href="https://www.keytomarkets.com/blog/analysis/the-week-ahead-20th-24-november-awaiting-fomc-minutes-27083/">The Week Ahead 20th &#8211; 24 November: Awaiting FOMC minutes</a> appeared first on <a href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>