Mid-December Market Analysis: Technical Insights and Trading Outlook for the Four Major Assets

Market Sentiment Turns, Focus on Non-Farm Payrolls and US Stocks

This week’s market focus is clear. Investors are closely watching the non-farm payrolls data to be released on December 16. The market generally expects a decrease of 10,000 jobs in October, but a strong rebound in November, adding about 130,000 jobs. Since the Federal Reserve’s current concern over the labor market exceeds inflation considerations, the performance of the non-farm payrolls data will directly influence expectations for the Fed’s future rate cuts.

More importantly, the gap between the massive investment expenditures and the actual returns of AI companies is raising market concerns. This worry is lowering market risk appetite, and the trend of US stocks will become the key variable in determining the overall asset allocation direction.

EUR/USD: Upward Trend Steady, Room to Rise

EUR/USD has been rising continuously over the past three trading days and is currently consolidating around 1.1740. Since finding support at 1.1620, the price has accelerated higher, with a series of new highs and higher lows indicating strong bullish momentum.

If EUR/USD can hold above 1.1700, the upward trend will continue, with the potential to challenge 1.1800 and even the psychological level of 1.2000. Conversely, a break below 1.1620 would signal a reversal of the uptrend.

Key Levels to Watch

• Support: 1.1620, 1.1700, 1.1470
• Resistance: 1.1800, 1.2000, 1.2200

GBP/USD: Breakthrough Imminent, Upward Momentum Unabated

GBP/USD has been consolidating below 1.3400 this week, but the past three weeks of rally indicate persistent bullish strength. After successfully breaking through 1.3350, the pair established a strong upward trend, suggesting further upside potential.

If GBP/USD can effectively break above the 1.3400 level, it is expected to rise further toward 1.3530. To reverse the upward trend, a decline below 1.3290 would be necessary to confirm.

Key Levels to Watch

• Support: 1.3290, 1.3350, 1.3200
• Resistance: 1.3400, 1.3530, 1.3700

Gold/USD: Technical Strength Continues, Bullish Momentum Persists

Last Monday, gold rose 1.14% intraday, reaching a high of $4,350.4. Gold remains above the Gann 2/1 line, indicating the overall uptrend remains intact. The outlook is for continued attempts to challenge the historical high of $4,381.5.

If gold successfully breaks above $4,381, there is room for further rebound toward $4,438 and even $4,570. A decline below $4,200 is needed to confirm a trend reversal.

Key Levels to Watch

• Support: 4200, 4250, 4130
• Resistance: 4381, 4438, 4570

NASDAQ 100 Index: Short-term Downside Risks Emerge

NASDAQ 100 fell sharply over 2% last Friday, with a low of 25,099 points, marking a three-week low. The index was repeatedly resisted above 26,000 points and recorded its largest decline in three weeks, indicating a short-term technical bias toward downside.

If the index continues to decline and effectively breaks below 25,000 support, the probability of testing 24,000 support increases.

Key Levels to Watch

• Support: 24,900, 25,200, 24,000
• Resistance: 26,000, 26,300, 27,600

Trading Tips

The four major assets currently show clear divergence: EUR, GBP, and gold maintain an upward trend, while tech stocks face correction pressure. Investors should closely monitor the non-farm payrolls release and US stock performance, as these will provide key guidance for subsequent asset allocation.