Market Overview:
The markets begin the week tense, with the Federal Reserve’s last policy meeting of 2025 shaping investor sentiment globally. Traders largely expect a 25 basis point rate cut but remain wary of a potentially hawkish tone that may alter expectations for the 2026 interest rate path.

The U.S. Dollar held steady below 99.20, bolstered by firm Treasury yields and cautious sentiment around the updated Fed dot plot, which may temper hopes for aggressive easing next year. Gold retreated from the $4,200 level due to rising yields limiting gains, while oil declined sharply toward $58 amid concerns of oversupply and a stronger dollar.

In currency markets, EUR/USD maintained a bullish structure following strong German industrial production data, USD/JPY was capped by weak Japanese GDP figures and ongoing Bank of Japan uncertainty, and commodity-linked pairs followed risk sentiment ahead of key inflation releases. With U.S. JOLTs data and multiple central bank decisions pending, the coming 48 hours are expected to bring heightened volatility across currencies, commodities, and indices.

Technical Analysis

USD/JPY – Bullish Momentum Pushes Price Toward 157.00 Resistance
The USD/JPY pair continues its upward trend, rebounding from the 20-day EMA and approaching a critical resistance zone at 157.40. Buyers remain in control, though a slowing MACD histogram suggests a brief pause may occur before further advances. Narrowing Bollinger Bands indicate consolidation, pointing to a potential breakout. Maintaining levels above 154.20 supports bullish bias, with a break above 157.40 likely to open the way toward 158.30 and possibly retesting November highs.

Key Levels:

• Resistance: 157.40, 158.30

• Support: 154.20, 153.00

EUR/USD – Bulls Maintain Control Approaching 1.1690 Resistance
EUR/USD retains a bullish outlook, trading above all major EMAs and riding the upper Bollinger Band, reflecting strong buying pressure. Momentum indicators such as MACD and RSI confirm growing upward momentum. Immediate resistance lies at 1.1690, with a successful breakout potentially targeting 1.1740. Should the price fall below 1.1630, a corrective pullback may occur, but the broader uptrend remains intact above 1.1510.

Key Levels:

• Resistance: 1.1690, 1.1740

• Support: 1.1510, 1.1480

USOIL – Bears Maintain Control as Price Struggles Below $60.60 Resistance
Crude oil prices continue their downward trend, unable to surpass resistance levels at the 20 and 50-day EMAs. Momentum indicators signal bearish conditions, supported by a MACD crossover and RSI below 50, though the slowing momentum suggests potential consolidation. A break above $60.60 could lead to gains toward $61.75, but failure to clear resistance points to further downside risk with support levels at $58.00 and $56.90.

Key Levels:

• Resistance: $60.60, $61.75

• Support: $58.00, $56.90

Economic Highlights

Gold (XAU/USD):
Gold traded just below $4,200 as investors adopted a cautious stance ahead of the Fed meeting. Expectations of a 25 basis point rate cut were offset by uncertainty regarding the updated dot plot and Fed chair signals. Rising U.S. Treasury yields and a firmer dollar capped gains, although safe-haven demand amid geopolitical tensions and central bank purchases limited deeper declines.

Oil (USOIL):
Oil prices declined due to a stronger dollar and weaker equity markets, which dampened demand outlooks. Geopolitical risks and concerns about oversupply in 2026, including potential increased Russian exports, weighed on the market. Despite some risk premium from geopolitical tensions, bearish fundamentals dominated.

Japanese Yen (JPY):
Japan’s GDP contracted more sharply than expected, challenging near-term Bank of Japan tightening prospects. However, rising wages and elevated government bond yields maintain some speculation of a December rate hike. Verbal interventions by Japan’s Finance Ministry and escalating geopolitical tensions add uncertainty. The USD/JPY pair remained capped below 155.50 amid these mixed signals.

Euro (EUR):
Germany’s industrial production surged by 1.8% in October, beating forecasts and supporting Euro strength. This data, combined with firmer Eurozone sentiment, boosted Euro yields briefly before traders refocused on the upcoming Fed decision. The robust German output strengthens the case for a hawkish ECB stance.

U.S. Dollar (USD):
The Dollar Index held just below 99.20 as markets positioned for the FOMC meeting. While a 25 basis point cut is expected, investors anticipate a “hawkish cut” with signals suggesting fewer rate reductions in 2026. Treasury yields and steady U.S. economic data support near-term dollar strength. Political uncertainty over Fed leadership adds some volatility but does not undermine the dollar’s consolidation.

Upcoming Economic Indicators – December 9

• Australia: NAB Business Confidence, RBA Interest Rate Decision (Forecast steady at 3.6%)

• Germany: Balance of Trade (Forecast surplus of €15.9B)

• Mexico: Core and headline Inflation Rates (Multiple forecasts)

• United States: JOLTs Job Openings for October (Forecast 7M openings)