This Week's Market Strategy - November 26, 2024 (Tuesday)

Last week, aside from PMI flash estimates from various countries, there were no particularly major indicators or events. However, Ukraine's attack on Russia using long-range missiles from the US and UK, followed by President Putin's approval of "lowering the threshold for nuclear weapons use," has begun to raise awareness of the intensification of the Ukraine war.

While the US dollar continued to rise due to geopolitical risks, USD/JPY remained stuck at higher levels, ranging from the early 153 yen level to the late 155 yen level, making for a directionless week. The market remains somewhat stuck even after the start of the week.

If USD/JPY adjusts to the 151 yen level, buy on expectations for one more final rally. Take profits at the 155 yen level. Stop loss if it breaks below 149 yen.

WTI crude oil futures were bought last week, but on Monday, following news that Israel and Hezbollah may be close to reaching a ceasefire agreement within days, it fell 3.2% and closed at $68.90 per barrel.

WTI crude oil fundamentals are weak, but it cannot be sold depending on the Ukraine war situation. Near the year's lowest level around 9/10, the 65 dollar level is a long position. Take profits at the 72 dollar level, stop loss below 60 dollars.

Meanwhile, gold, which had surged sharply last week, fell dramatically by as much as 100 dollars from the 2,700 dollar level.

President-elect Trump's nomination of hedge fund manager Scott Bessent as Treasury Secretary also appears to have been a selling factor for gold.

From a long-term perspective on gold, a break below 2,600 dollars is a buy. Short-term: short at 2,725 dollars, stop loss at 2,800 dollars, take profits at 2,550 dollars.

Like the US dollar, US long-term interest rates have fallen sharply, which weighs on the top of USD/JPY, but the bottom remains firm.