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In addition, traders are awaiting a crucial macroeconomic report.
On Tuesday, the main US stock indices closed mixed: the Dow gained 0.5%, the NASDAQ Composite shed 0.5%, and the S&P 500 rose by 0.2%.
Market participants are waiting for important economic data. Besides, trading floors will be closed on the occasion of Thanksgiving day.
Asian stock markets also closed mixed today: Japan's stock indices fell by 1.6%, while China's stock indices rose slightly by 0.3%.
As for the commodity market, oil prices grew on Tuesday. Brent crude climbed to $82 from $78 per barrel. The oil market has been rising for the third day in a row despite Biden's order to release US Strategic Petroleum Reserves and sell 50 million barrels. Biden intends to push down oil prices. Japan's Prime Minister Fumio Kishida also announced that his government would release some oil reserves to combat rising prices. Oil inventories in the United States increased over the week by 2.3 million barrels, while analysts had predicted a decline.
The S&P 500 is trading at 4,690. It is likely to trade in the range of 4,650 - 4,700.
The decision of the US authorities to bring key manufacturing companies back to the US by giving them some benefits turned out to be successful. Samsung, one of the leading electronics manufacturers, picked Texas as the location for a new $17 billion plant to make advanced chips for functions such as mobile, 5G, high-performance computing, and artificial intelligence. This is the largest direct investment of a foreign company in Texas in history.
Analysts assessed Biden's decision to nominate Jerome Powell as Fed Chair for the second term. So, many traders are sure that the Fed will continue its soft policy for as long as possible. However, rising inflation in the US is the most important problem. Yet, the regulator does not seem to have a solution.
Today, the US is going to release a batch of macroeconomic reports such as the revised GDP data for the 2nd quarter (the forecast reading is 2.2%), durable goods orders, a weekly report on initial jobless claims, and a new inflation report for October. Now, inflation is above 5%. In case of a decrease in inflation, the stock market may resume a bullish trend. The US dollar, on the contrary, is likely to decline. In addition, there may be a new wave of sales in the US stock market before the weekend.
The US dollar index is trading at 96.40. It is likely to remain in the range of 96.10 - 96.70. The US dollar is trading at 12-month highs ahead of the weekend. In general, the US dollar is trading with a bullish bias. Yet, it may soon enter the correctional phase. If so, there is a possibility of a strong pullback.
The USD/CAD pair is trading at 1.2680. It is likely to stay in the range of 1.2600 - 1.2720. The price's growth was limited by the rally in the oil market in the last three days. The price is likely to climb if the US dollar continues to rise.
Conclusion. It is recommended to postpone opening long positions on the US dollar. Look at the market closing before the weekend. It is better to open long positions at a strong pullback from the 50-day average.
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