Despite the mixed performance on Tuesday, when the dollar was up and down, overall bulls remain in play. The greenback retested six-month high against yen at 111.34 and posted fresh 9 ½ month high at 1.0132 vs the Swiss Franc.

Dollar’s bulls paused in early Wednesday, taking a breather after Tuesday’s rallies but holding strong bullish sentiment, boosted by expectations for interest rate hike and new policies from Trump’s administration.

The dollar index was marginally lower in Asia, hovering around 101.00 handle and keeping above near-term consolidation low at 100.70.

Dollar/yen stays firm and regained 111.00 level, after brief probes below in Asia. There are no firm signs of stronger pullback, despite the greenback is strongly overbought.

Australian dollar resumed near-term recovery against its US counterpart on Wednesday, being in strong bullish mode for the third consecutive day, despite the release of downbeat Australian data overnight. Construction Work Done dropped 4.9% in Q3, undershooting expectations for 1.5% drop and falling below Q2 release at -3.1%. Weaker-than-expected data did show stronger impact on the Aussie dollar that rose to 0.7443 high on Wednesday, on correction of two-week steep fall that found footstep at 0.7300 zone.

Oil prices trade in narrow consolidation in Asia, after falling from fresh high on Tuesday on renewed doubts over whether OPEC would agree to cut oil production on ministerial meeting next week.

US oil fell $2 from fresh nearly one-month high at $48.19 to $47.16, low of Tuesday and holding around $48.00 handle at the beginning of European session on Wednesday, eyeing release of weekly crude stocks data. The Energy Information Administration (EIA) is due to publish official U.S. crude oil and refined product inventory data later on Wednesday.

U.S. crude stockpiles are expected to rise by 0.7 million barrels, compared to previous week’s rise of 5.3 million barrels.
Spot Gold ticked higher on Wednesday, after dipping back close to recent low at $1202, signalling persisting downside pressure on bullish dollar and expectations of US interest rate hike in December.

The yellow metal is in near-term consolidation above key support at $1200, as dollar bulls are taking a breather, but limited recovery action signal that overall bears remain firmly in play.

Asian Stocks were overall positive on Wednesday. Australian shares advanced for a second straight day on Wednesday, boosted by financial and materials stocks, as well as RBA’s positive view on normalising inflation. The S&P ASX index rose 1.35% on Wednesday.

Hong Kong’s Hang Seng was up 0.18%, Singapore index ended session flat, while Japan’s Nikkei 225 gained 0.14%.

European stocks were mixed on Wednesday, as FTSE 100 remained positive and was up 0.19% in early Wednesday’s trading. DAX and CAC40 were in red and down 0.05% and 0.09% respectively.

Highlights of the day

Europe
Series of PMI data are in focus of European session. French Manufacturing PMI was slightly above forecast in November, coming at 51.5 vs 51.4 expected, but stayed below October’s 51.8 release.
German PMI numbers came mixed in November. Manufacturing PMI was at 54.4, vs 54.8 consensus, while Services PMI beat the forecast at 54.0 and Oct 54.2 on today’s release at 55.0.
Eurozone Manufacturing PMI is expected at 53.3 in November, slightly below previous month’s 53.5, while forecast for Services PMI lies at 53.0, slightly above October’s 52.8 release.

America
American session is busy, as some economic indicators are going to be released one day earlier, due to Thanksgiving Day holiday tomorrow.

Weekly jobless claims are forecasted at 241K, expected to jump from record low of last week at 235K.
US Durable Goods Orders are expected to tick higher to 0.2% in Oct, from previous month’s 0.1% release.
Both releases are due at 13:30 GMT.
US Weekly Crude Inventories are due at 15:30 GMT, with forecast for 0.7 million barrels build, compared to build of 5.3 million barrels last week.
The session will conclude with the minutes of last FOMC monetary policy meeting, due at 19:00 GMT.

Important levels
EURUSD
The Euro was in red in Asia on Wednesday, after Tuesday’s long-legged Doji signalled indecision, after rallies failed to break n/t consolidation top at 1.0650 zone. Fresh weakness cracks hourly cloud base at 1.0608 that would signal further easing.
Next support lies at 1.0582, ahead of recent low at 1.0567 which guards critical 1.05 support zone.
Initial resistance lies at 1.0622, followed by 1.0642 and pivotal barrier at 1.0656.

USDJPY
The pair ended Tuesday’s trading in green, after retesting 111.34 peak and sidelining risk of deeper pullback for now. Overall structure remains bullish and favors further upside, with next target at 112.12 being in sight. Initial support lies at 110.83, followed by 110.25 and 110.00 pivots., Market Analysis