December Market Focus: Bitcoin, Forex, and Precious Metals Technical Landscape Scan

Macroeconomic Background: The Delicate Balance Between Central Bank Policy Expectations and Government Bond Yields

This week’s market focus centers on the contrast between Federal Reserve policy expectations and global government bond yields. Traders generally anticipate a rate cut following the Federal Reserve’s policy meeting next week, with an 87% probability. The market is betting that a rate cut will be announced in December, followed by two more cuts next year, aiming for an ultimate target range of 3.00%-3.25%. However, the reality presents a “cloudy and unpredictable” scene: despite rising expectations for rate cuts, the 10-year U.S. Treasury yield has unexpectedly climbed to 4.15%.

Long-term government bond yields in major economies worldwide are generally rising. Japan’s 10-year government bond yield has reached 1.97%, while Germany’s has increased to 2.81%. This rise may reflect market concerns over the Federal Reserve’s independence, heightened expectations of rate hikes by the Bank of Japan, and considerations about the sustainability of U.S. government debt. These underlying concerns are gradually transforming into risk factors in trading.

Bitcoin: The $90,000 Level Becomes a Bullish Fortress

Bitcoin rose by 1.8% during the trading session on December 8, reaching a high of $92,296. Currently, Bitcoin has stabilized above $90,000, indicating a recovery cycle. Recent data shows that BTC is trading at approximately $87.61K, with overall volatility remaining moderate.

On the technical front, the AO indicator shows that bullish sentiment is steadily increasing, with the least resistance pointing upward. If Bitcoin can hold steady above $90,000, it may further attempt to test $95,000 and eventually approach the $100,000 mark. Conversely, if it falls below the key support level of $86,000, caution is warranted for a potential decline toward $75,000.

Bitcoin Technical Levels:

• Support: 90,000, 86,000, 75,000
• Resistance: 95,000, 100,000, 106,000

USD/JPY: Long-term Uptrend Under Pressure

USD/JPY edged up slightly by 0.1% on December 8, reaching a high of 155.54 and temporarily stabilizing around 155.0. Notably, this currency pair is testing the long-term upward trendline again. The AO indicator signals caution—downward momentum is gradually strengthening, suggesting a tendency for further decline.

If USD/JPY breaks below the psychological level of 155.0, it could face additional downward pressure, with potential tests of 152.0 or even 150.0. To reverse the downtrend, USD/JPY needs to recover and stabilize above 156.0, then challenge the 157.0 level and higher.

USD/JPY Technical Levels:

• Support: 155.0, 152.0, 150.0
• Resistance: 157.0, 158.0, 160.0

Gold: Repeated Tests of the $4,200 Level with Downside Risks

Gold rose by 0.27% on December 8, reaching a high of $4,219. However, it has failed to break through the $4,200 level after four consecutive attempts, indicating weakening short-term momentum. Gold remains within a consolidation range of approximately $3,890 to $4,225, which has yet to be effectively broken.

The daily chart shows that gold is in a long-term upward trend since February 2024, currently forming the fourth consolidation phase, often a sign that the overall bullish trend remains intact. However, caution is advised as there is a possibility of a short-term pullback to the Gann 2/1 line at $4,050, which could serve as a critical support zone for bulls.

Gold Technical Levels:

• Support: 4,130, 4,050, 3,930
• Resistance: 4,220, 4,300, 4,381

Silver: High-Level Convergence with Intense Bulls and Bears

Silver increased by 0.23% on December 8, reaching a high of $58.72. The ongoing new highs indicate that bullish momentum remains intact. However, recent sideways consolidation suggests fierce competition between bulls and bears within this range, and investors should be alert to short-term corrections.

The daily chart suggests that if silver can hold above $56.50, it may further rise, challenging $60.0 and even $63.50, opening a new upward phase. Conversely, if silver drops below $56.5, further declines toward $53.8 or even $51.0 are possible.

Silver Technical Levels:

• Support: 56.5, 53.5, 50.0
• Resistance: 60.0, 63.5, 68.0

Summary

This week, multiple assets face a test of macro expectations versus actual policy signals. Bitcoin remains resilient above the $90,000 mark, reflecting the strength of risk assets; gold and silver’s consolidation at high levels indicate a stalemate between safe-haven sentiment and economic optimism; USD/JPY faces trendline resistance, with downside risks warranting close attention. Investors should monitor upcoming signals from the Federal Reserve and the Bank of Japan, as well as key technical levels across assets, to adjust positions promptly in response to market changes.