Today market outlook

[Zeologic]

Gold consolidates near the psychological level of $4,300

Gold price movement over the past three days has tended to be limited near the upper band line. After reaching a high of $4,353, the price fell again, moving within a range of $4,271-$4,353. Yesterday, gold formed a small bullish candle with short wicks at the top and bottom of the candle. Gold opened at $4,306, with a high of $4,334, and a low of $4,271, closing at $4,310.

Gold prices are influenced by several key factors, such as Fed sentiment and US interest rates. The market continues to monitor signals from the Fed. If US economic data, such as employment and inflation, indicate that the Fed will ease policy in the future, this tends to weaken the US dollar and support gold.

Recent US data released on December 16th showed mixed results. The economy added more people than expected to the labor force in November, but the Unemployment Rate rose to its highest level since 2021. Although the report confirmed further easing, expectations for an interest rate cut in January 2026 remain low at around 25%, as shown by Capital Edge data.

Meanwhile, US retail sales showed that American consumer spending remained slightly strong, with retail sales unchanged in October. The report indicated that people faced higher prices for food, furniture, and various other imported goods due to Trump's tariffs.

Traders will continue to monitor other US data, such as jobless claims due Thursday and the Personal Consumption Expenditures (PCE) Price Index on Friday.

The US Dollar Index (DXY) is also a market focus, as gold is traded in USD. Strengthening or weakening of the USD can influence gold price movements. The DXY is currently rebounding to 98.203 after dropping to 97.869. The DXY sentiment is bearish below its 20-day moving average (MA).

Gold is a safe-haven asset that is also influenced by geopolitical factors. Global geopolitical or economic uncertainty tends to drive demand for gold. Recent developments in the Russia-Ukraine war remain uncertain, although talks stalled after Kyiv drafted a 20-point plan that the Kremlin has not yet accepted, temporarily dampening demand for safe assets.

In talks supported by the US and the European Union, there has been tangible progress toward ending the war. Ukraine is considered willing to abandon its ambitions to join NATO as part of a Western security guarantee, but refuses to cede territory. Western sanctions against Russia remain in place and are impacting the global economy, including the energy and commodity sectors. This conflict is a factor contributing to global market uncertainty.

Conclusion: Gold is currently consolidating around the psychological level of $4,300 and seeking new catalysts. Traders will await US economic data and the market's interpretation of the Fed's monetary policy outlook.

The gold price range forecast, based on technical analysis, indicates consolidation. Major support is estimated to be in the range of $4,270-$4,250, and major resistance is in the range of $4,350-$4,380.

[Zeologic]

GBP/JPY rises amidst unique policy divergence

The GBP/JPY cross pair rose during the trading session on Wednesday, December 17, 2025, drawing a bullish candlestick, extending the previous bullish. The price formed a high of 208.381, a low of 207.056, and a close of 208.362.

The current strengthening of the GBP against the JPY occurs amid a unique market situation due to opposing policy divergences, which could trigger high volatility in the GBP/JPY.

On the GBP side, the market currently expects the Bank of England (BoE) to cut interest rates by 25 bps to 3.75% from 4.00%. This expectation has been fueled by the latest UK economic data, which shows weak GDP in October and rising unemployment. Subdued inflation provides room for the BoE to cut ahead of Christmas. If the rate cut is confirmed with a pessimistic tone regarding the UK economy, the GBP could potentially weaken.

At the same time, the Bank of Japan (BoJ) is expected to raise interest rates, indicating a more hawkish stance, as recent solid Japanese economic data reinforces expectations that the BoJ intends to normalize its monetary policy. Market sentiment toward the yen has gained additional strength as it is the only major currency with an upward trend in interest rates, while other countries, such as the UK and the US, have begun to cut rates. A BoJ rate hike could trigger a strengthening of the JPY, which would put downward pressure on the GBP/JPY pair.

Recent UK economic data shows that UK CPI fell to 3.2% in November, lower than market expectations, reinforcing expectations that the BoE will cut interest rates, which will be released today or soon.

UK economic output contracted, and employment indicators weakened, with the unemployment rate rising. This reinforces dovish pressure on the GBP. Consequently, the fundamental bias is bearish, as expectations of a BoE rate cut typically weaken the GBP against other major currencies.

The JPY has fundamentally weakened in recent years due to low Japanese yields, but expectations of a BoJ interest rate hike could provide temporary technical support. As a result of this policy direction, sentiment is slightly bullish on the JPY if the market interprets the interest rate hike as a meaningful policy change, potentially strengthening it against the GBP.

The GBP tends to be under pressure due to expectations of interest rate cuts and weak economic data. The JPY has the potential to gain strength from expectations of a BoJ interest rate hike. In the short term, overall fundamentals are bearish for GBP/JPY, barring any global market risks or unexpected news that supports the GBP.

Although not directly impacting GBP/JPY, traders will also be watching US economic data today, including unemployment claims and inflation.

GBPJPY price range forecast: lower support is around 206,600 - 207,200, and upper resistance is around 208,500 - 209,100. If the Bank of England (BoE) cuts interest rates as expected, selling pressure could break through support. Conversely, if the BoJ does not raise interest rates as expected, the JPY could weaken again.