AI Optimism Lifts US Stocks as Dollar Surges, Gold Slips and Oil Faces Supply Pressure – Comments from Century Financial

On the weekly chart, the Nasdaq 100 has rebounded from horizontal support located at $26,318, which marks a breakout-retest zone. However, on the daily chart, the index is hovering just under the 200-day EMA at $28,081, which acts as immediate resistance. A break above could take the index to $28,845, while a drop could bring it down to around $27,569. The S&P 500, on the other hand, is at $7,580. It has immediate support around $7,542, with the next support at the 200-day EMA at $7,375. If it clears the $7,622-$7,642 zone, it could potentially encounter next resistance around $7,706.

U.S. Dollar Index
The dollar index rose more than 0.6% on Wednesday to close around 102.9, and this morning it is trading near 103.0, its highest level since April 2025. The move extends Tuesday’s rally after the hot October CPI report and takes the index above the October 14 high of 102.95, the previous 52-week high. Fed hike expectations continue to build. A December hike is now fully priced, with CME FedWatch showing about 88% for a 25 basis point move and 11% for a 50 basis point move, and markets see better-than-even odds of a second hike in January. After Waller said a half-point hike should be considered and Logan called for two more increases, analysts now expect hikes in December and March. The dollar also gained against the major currencies. USD/JPY is at around 159.8 and just below 160, after a dovish speech from a Bank of Japan board member; EUR/USD is near a two-week low around 1.107.

Today’s focus is on US initial jobless claims and the New York Fed President Williams on a panel late in the day. His remarks will be watched closely, since he had suggested before the October FOMC meeting that the Fed had time on rate hikes. PPI follows on Friday, with headline expected at about +0.4% and core at +0.3%. A strong claims number or hawkish remarks would likely keep the dollar bid, while a softer tone from Williams could trigger some profit taking after the two-day rally.

Technically, the DXY has broken out of the 101.50 to 102.95 range it has traded in since 1 October, and remains above its 9- and 21-day moving averages. Having broken through 102.95, that level now becomes first support, and a close back below it would raise the risk of a false breakout. Below that, support lies at 102.42, followed by the 9- and 21-day SMAs at around 102. On the upside, first resistance is at 103.18, followed by 103.45.

Gold & Silver
Gold trades near $3,978, down 0.2% after slipping below the psychologically important $4,000 mark to a more than one-week low, extending the pullback that began with Tuesday’s hot inflation print as sellers stay in control ahead of the next catalyst. Stronger-than-expected October CPI data and hawkish remarks from Fed officials have pushed the dollar to a 19-month high, making bullion more expensive for holders of other currencies. Traders are now fully pricing in a December rate hike, with odds of a half-point move surging and another hike priced in for March next year. Higher rates raise the opportunity cost of holding non-yielding bullion, reducing its appeal, and the near-term macro setup for gold remains unfavourable. Attention now shifts to Friday’s US PPI report.

Physical demand offers little offset, with Indian wholesalers buying muted through the Diwali holiday period, while progress on the proposed US-Iran peace deal threatens to unwind part of gold’s geopolitical risk premium. Gold is increasingly trading the rates story rather than a safe-haven one; the correlation between gold volatility and the MOVE Index is now near a four-year low. Gold is testing the breakout trendline near key support at $3,978–$3,936, which has held since late October. Resistance stands at $4,000, followed by $4,050 and $4,148. A break below $3,933 could push prices towards $3,900 and then $3,840. Silver trades near $51.53, down 0.2%. Technically, silver has been rejected from the $53.00–53.50 resistance area for a third time and is drifting back toward support at $51.00. A break below would expose $49.19, and then $48.39. Resistance sits at 53.50, with $54.95 the key pivot.

Crude Oil
Crude oil prices closed another session relatively flat, with WTI down 0.16% and Brent up 0.31%. Both instruments are trading slightly higher during Thursday’s Asian session, with WTI up 0.32% and Brent up 083%.

Oil came under pressure after Saudi Arabia told OPEC that its oil output increased by 26% in October to one of the highest monthly levels in years. The rise in flows through the Strait of Hormuz is helping to push prices down. The kingdom has informed OPEC that its output rose to 10.56m b/d in October, according to a monthly OPEC secretariat report seen by Bloomberg. That’s still a few hundred thousand b/d below the level seen in February, when Riyadh ramped up output in the lead-up to the conflict, but it is well above pre-war levels and slightly in excess of its OPEC allocation. Iraq has also told OPEC it increased its output to a new wartime high of nearly 4.9m b/d, again well above its agreed quota. The increases are a clear sign of the success of the Saudis and other Gulf exporters in getting volumes back up despite the ongoing conflict and the series of Iranian attacks on tankers. The oil market is clearly feeling the heat as it’s showing the effect in physical markets, even as demand remains restrained, resulting in signs of a surplus.