Market Sector Scanner: Risk Appetite Rebounds and Gold Rises Again Ahead of Powell’s Speech
Global sentiment improved in the shortened Thanksgiving week as dovish Fed signals and weak U.S. data boosted rate cut expectations. Stocks and gold advanced, while traders now await Powell’s speech for clues on future policy direction.
In the shortened U.S. Thanksgiving week, risk appetite improved as dovish Fed comments and weak economic data raised expectations of rate cuts. Gold gained on renewed safe-haven demand, while U.S. and Japanese equities advanced. Japan’s 10-year bond yield neared a 17-year high on stronger data and speculation of a Bank of Japan rate hike, while a U.S. peace proposal for Ukraine lifted hopes but had little market impact.
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Key Events Calendar for December 1 – 5
Market Sector Scanner
Forex Market
USD/JPY
Last Week Recap
Increased expectations of a December U.S. interest rate cut pushed USD/JPY lower last week. Persistently high inflation data in Japan also encouraged yen buying, as the gap between U.S. and Japanese interest rate outlooks appeared to narrow.
Technical Picture
After the upper Bollinger Band acted as resistance, the market pulled back to the 10-day moving average, where selling pressure eased near the previous resistance-turned-support at 156.
Outlook This Week
The uptrend looks set for a short pause, making this week ideal for range trading between 155.5 and 157. Fed Chair Powell’s speech will be a key event for market direction.
GBP/JPY
Last Week Recap
GBP/JPY held key support at 205 and extended its recent uptrend, with the U.K. budget announcement received positively by markets following earlier concerns over government finances.
Technical Picture
The upper Bollinger Band triggered a sell signal last week, prompting some profit-taking, but the 10-day moving average continues to point higher, suggesting further medium-term gains remain likely.
Outlook This Week
Short-term weakness could continue, offering a potential buying opportunity near the 10-day moving average and support around the 205 level.
EUR/USD
Last Week Recap
EUR/USD tested higher toward resistance at 1.1600 on hopes the U.S. Federal Reserve will cut rates at its December meeting. However, gains were capped late in the week after weaker-than-expected German retail sales data weighed on sentiment.
Technical Picture
The Bollinger Bands are narrowing as volatility declines, making it harder for the market to extend gains. Despite breaking the recent downtrend with a close above the 10-day moving average, the upper Bollinger Band is likely to limit further upside momentum.
Outlook This Week
The medium-term trend for EUR/USD remains bearish, so traders should watch for potential selling opportunities as the pair trades near short-term resistance.
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Equities
U.S. Stock
Last Week Recap
The Nasdaq recovered part of the month’s losses during the shortened trading week, as concerns over AI stock valuations eased and expectations of a U.S. interest rate cut in December encouraged buying.
Technical Picture
The rebound was stronger than expected, easily breaking the short-term downtrend with a close above the 10-day moving average. The Bollinger Bands provided solid support last week and remain wide due to elevated volatility.
Outlook
The market may continue to rise in the short term, with momentum supported by improving sentiment. However, with few major news events aside from Fed Chair Powell’s speech, sideways movement is likely. Selling into short-term weakness could be the best strategy this week.
Commodities
XAU/USD
Last Week Recap
Gold resumed its uptrend, benefiting from growing market expectations of lower U.S. interest rates. Long-term investors also remained active buyers, helping to drive prices higher throughout the week.
Technical Picture
The rally has taken prices to the upper Bollinger Band, though a sell signal has not yet been triggered, as confirmation would require trading above and then below the band. The 10-day moving average continues to slope upward, suggesting buyers are likely to step in on any weakness.
Outlook This Week
In the short term, the market appears overbought, so waiting for a pullback closer to the 10-day moving average could offer better buying opportunities. Alternatively, a short-term buying setup may emerge if prices break above the November highs.
This week’s focus will be on Federal Reserve Chair Powell’s speech, as traders look for clues about the timing and pace of future U.S. interest rate cuts. His remarks could shape sentiment across markets, with a dovish tone likely to support further gains in gold. Markets will also watch the delayed U.S. employment data and whether the recent recovery in U.S. equities can continue.
