Has the Trump trade run its course?

GBPUSD – technical overview

Signs have emerged of the market wanting to put in a longer-term base after collapsing to a record low in September 2022. The door is now open for the next major upside extension towards the 2018 high at 1.4377. Any setbacks should be well supported ahead of 1.2500.

• R2 1.2834 – 6 November low – Medium
• R1 1.2770 – 13 November high –Medium
• S1 1.2630– 14 November low – Medium
• S2 1.2613 – 27 June low – Strong

GBPUSD – fundamental overview

The Pound has been hit hard this week on the back of the pricing in of a Dollar bullish Trump administration, news of UK business insolvencies rising 64% from a year ago, and some concerning employment data. The fact that the current UK government is not on great terms with President-elect Trump is not helping matters. Key standouts on Friday’s calendar come from German wholesale prices, UK GDP, industrial production, trade, and construction orders, Canada manufacturing sales, and US retail sales, NY empire manufacturing, and industrial production.

USDJPY – technical overview

The market is looking to resume the longer-term uptrend after an intense correction in 2024. A higher low is ideally sought out above 140.00 in favor of a bullish continuation. A weekly close back above 150.00 will hint at the start to longer-term uptrend resumption.

• R2 157.00 – Figure – Medium
• R1 156.75 – 15 November high – Medium
• S1 154.34 – 13 November low – Medium
• S2 152.14 – 8 November low – Medium

USDJPY – fundamental overview

The latest solid growth data out of Japan and another round of currency jawboning have done little to slow the recent pace of Yen declines, mostly on the back of the market's pricing in of the US Dollar bullish Trump trade. Earlier, Japan FinMin Kato described recent moves in the yen as one-sided and rapid. Key standouts on Friday’s calendar come from German wholesale prices, UK GDP, industrial production, trade, and construction orders, Canada manufacturing sales, and US retail sales, NY empire manufacturing, and industrial production.

AUDUSD – technical overview

There are signs of the potential formation of a longer-term base with the market trading down into a meaningful longer-term support zone. Only a monthly close below 0.6200 would give reason for rethink. A monthly close back above 0.7000 will take the big picture pressure off the downside and strengthen case for a bottom.

• R1 0.6688 – 7 November high – Strong
• R2 0.6547 – 13 November high – Medium
• S1 0.6440 –14 November low– Medium
• S2 0.6400 – Figure – Strong

AUDUSD – fundamental overview

The ailing Australian Dollar is trying to recover on Friday, looking for some positive momentum from a round of China data that was mostly better than expected. Key standouts on Friday’s calendar come from German wholesale prices, UK GDP, industrial production, trade, and construction orders, Canada manufacturing sales, and US retail sales, NY empire manufacturing, and industrial production.

USDCAD – technical overview

A sustained hold above 1.3000 over the past several months signals an end to a period of longer-term bearish consolidation and suggests the market is in the process of carving out a more significant longer-term base. Next key resistance now comes in up into the 1.4500-1.5000 area, exposing a retest of the 2020 high just ahead of 1.4700. Setbacks should be very well supported down into the 1.3000 area.

• R2 1.4100 – Figure – Strong
• R1 1.4072 – 15 November/2024 high – Medium
• S1 1.3930 – 13 November low – Medium
• S2 1.3817 – 6 November low – Strong

USDCAD – fundamental overview

The Canadian Dollar has sunk to a fresh yearly low against the Buck. The Trump trade is back in full swing, commodities have come under intense pressure and risk sentiment has been turning down. All of this is factoring into the renewed bout of Canadian Dollar weakness, with major stops taken out on Thursday as the Canadian Dollar sunk to its lowest level since the pandemic in May 2020. Key standouts on Friday’s calendar come from German wholesale prices, UK GDP, industrial production, trade, and construction orders, Canada manufacturing sales, and US retail sales, NY empire manufacturing, and industrial production.

NZDUSD – technical overview

Overall pressure remains on the downside with the market continuing to stall out on runs up into the 0.6500 area. At the same time, there are some signs of the market wanting to put in a longer-term base. Ultimately, a break back above 0.6500 would be required to take the medium-term pressure off the downside and encourage this prospect. A monthly close below 0.5800 will intensify bearish price action.

• R2 0.6038 – 7 November high – Strong
• R1 0.5948 – 13 November high – Medium
• S1 0.5839 – 14 November/2024 low – Medium
• S2 0.5800 – Figure – Strong

NZDUSD – fundamental overview

We've just seen another soft round of data out of New Zealand, this time from manufacturing PMI reads which further strengthen the case for another 50 basis point cut from the RBNZ later this month. Key standouts on Friday’s calendar come from German wholesale prices, UK GDP, industrial production, trade, and construction orders, Canada manufacturing sales, and US retail sales, NY empire manufacturing, and industrial production.

US SPX 500 – technical overview

The longer term uptrend remains intact and dips continue to be exceptionally well supported. Critical support comes in at 5679, with only a break back below this level to compromise the structure and open the door for a more significant corrective decline. Until then, the focus remains on a continued push to fresh record highs.

• R2 6100 – Round Number – Strong
• R1 6033 – 11 November/Record high – Medium
• S1 5891 – 17 October high – Medium
• S2 5697 – 4 November low – Strong

US SPX 500 – fundamental overview

The US equities market remains exceptionally well supported in 2024 on the back of an ongoing expectation for more rate cuts than less going forward. Investors are feeling better about a soft landing in the US economy and this has also been accompanied by an accommodative adjustment of Fed policy. Moreover, there has been a fresh wave of market optimism in the aftermath of the Trump election victory. It will however be important to keep an eye on inflation, bigger picture economic data, and geopolitical risk in the weeks and months ahead.

GOLD (SPOT) – technical overview

The 2019 breakout above the 2016 high at 1375 was a significant development, opening the door for fresh record highs and this next major upside extension into the 3000 area. Setbacks should now be well supported above 2500 on a monthly close basis.

• R2 2791 – 31 October/Record high – Strong
• R1 2709 – 23 October low – Medium
• S1 2537 – 14 November low – Medium
• S2 2500 – Round Number – Strong

GOLD (SPOT) – fundamental overview

The yellow metal has pushed record highs in 2024 with solid demand from medium and longer-term accounts. These players are more concerned about inflation, geopolitical risk and a less upbeat global growth outlook. All of this should keep the commodity well supported over the coming months.