The trade: impact of US dollar, Nasdaq gains, and Bitcoin rise

Pressure on the Australian dollar

The Australian dollar (AUD) is facing significant pressure, reaching a year low due to the ongoing strength of the United States (US) dollar. This decline is partly attributed to weak housing data from China, where house prices have fallen for 17 consecutive months. Given Australia's heavy reliance on the Chinese market, especially in commodities like iron ore, the AUD has been impacted.

Technical analysis indicates that if the AUD breaks below the current support level, it could fall further to around 0.6270, possibly testing the 0.60 area. Traders should exercise caution, as the market is currently short on the AUD, and a breach of these levels could trigger additional selling.

Nasdaq's bullish momentum

The Nasdaq 100 has recently achieved new highs, driven by strong performance and fewer interest rate concerns compared to the Dow Jones. However, the market remains cautious about potential hawkish signals from the Federal Reserve (Fed), which could affect equity markets.

A key resistance level for the Nasdaq is around 22,350, where traders anticipate potential consolidation.

Santa Claus rally and ASX 200 insights

The upcoming Federal Open Market Committee (FOMC) meeting and the typically low liquidity during the Christmas period could influence market dynamics.

The ASX 200 is also experiencing a Santa Claus rally, with a recent bullish engulfing candle suggesting possible retests of previous highs as the year concludes.

Bitcoin's rise and gold's tension

Bitcoin continues its upward momentum, reaching record highs above $108,000, driven by positive sentiment and recent political developments in the US favouring cryptocurrency. However, traders should be aware of potential pullbacks, as technical indicators show bearish divergence on the relative strength index (RSI).

Meanwhile, gold has come under pressure due to anticipated interest rate cuts and a stronger US dollar. The gold chart shows a double top at $2721, with potential support at $2600. A break below this level could lead to a deeper decline towards the 200-day moving average around $2465.