Tesla delivers blowout quarter

Tesla delivers blowout quarter – Tesla Inc. saw an $80 billion surge in market value after reporting its largest quarterly profit in over a year and optimistic forecasts for 2025. Q3 results were boosted by profitable Cybertruck sales, strong performance in energy storage, and increased regulatory tax credits.

Elon Musk shared plans for 20% to 30% delivery growth next year and announced intentions to launch ridesharing services in Texas and California, impacting shares of competitors Uber and Lyft. Additionally, production of the Cybercab is expected to reach 2 million units by 2026, with potential for up to 4 million.

German business downturn eases 

Business activity in the euro area’s two largest economies continued to decline this month, but there are signs that Germany may be on the verge of a return to growth this quarter.

In Germany, the contraction in the private sector eased in October, with the flash Purchasing Manager Index (PMI) from S&P Global rising to 48.4 from 47.5 the previous month. Although this figure is still below the 50-point threshold that separates expansion from contraction, it surpassed the slight increase predicted by economists in a Bloomberg survey.

In contrast, France experienced a more intense downturn, characterized by a “sharp and accelerated decrease” in demand, particularly in the manufacturing sector compared to services. The PMI for France fell to 47.3 from 48.6, while analysts had anticipated an improvement.

These two countries are viewed as major contributors to a broader slowdown in the euro area, which has already led the European Central Bank (ECB) to accelerate monetary easing measures last week.

Traders slightly increased their expectations for easing, now pricing in about a 50% chance of a half-point interest rate cut at the ECB’s next meeting in December.

ECB members views

ECB officials are starting to have differing views on the direction of monetary policy as the institution’s 2% inflation target comes within reach.

Some of the more dovish officials are openly discussing the need for larger interest rate cuts, while their hawkish colleagues are urging caution. They agree that borrowing costs shouldn’t burden the economy for longer than necessary, but they also emphasize that the fight against rising price pressures is not yet over.

Last week, the ECB cut rates for the third time this year, reducing the key deposit rate to 3.25%. Economists and traders anticipate additional rate reductions in the coming months

DXY upside momentum has eased

Despite the US Dollar Index reaching its highest level since the end of July during yesterday’s trading, it lost almost 80% of that rally. Technical indicators are heavily overbought and are beginning to trend downward, which could suggest that the upward movement may be coming to an end.

It’s still too early to draw conclusions. A weekly close below 104.0 would be ideal for continued downside pressure. If that happens, the next support level is at 103.75, followed by 103.40. On the upside, key resistance is between 104.40 and 104.70

EURUSD back over 1.08

The Euro is showing more signs of stabilization following recent declines that brought it to its lowest level since mid-July. The technical indicators are significantly oversold, suggesting potential for another upward movement. This optimism is particularly supported by today’s PMI data from Germany, which has eased expectations for an aggressive approach from the ECB.

The Euro rebounded from yesterday’s losses and surged above 1.08. To sustain this upward momentum, it needs to close the week above that level. If it does, the next resistance points will be at 1.0830, followed by 1.0870 and 1.09.

Gold reversal

Gold experienced a significant decline yesterday after hitting a new record of 2758, dropping to a low of 2708 by the end of the US session. However, today, Gold has edged higher again, reaching around 2738. Despite this slight recovery, the technical indicators on the daily chart remain heavily overbought, suggesting that a deeper correction to the downside may be possible in the coming weeks.

In the current complex market environment, which includes the upcoming US elections and ongoing geopolitical tensions in the Middle East and Ukraine, Gold still has potential for further gains. However, there is a significant possibility of a downside retracement, particularly given that the technical indicators are heavily overbought. For now, 2750 serves as a solid resistance level, while the key support is at 2700.

GBPUSD holding above 1.29

The GBPUSD pair made a recovery in today’s trading, staying firmly above the key support level of 1.29 after the release of the UK’s PMI data. However, all eyes are on the upcoming budget release later this month, as it is expected to significantly impact the GBP.

Currently, 1.29 is seen as a crucial support level. If the price closes below this level on a weekly basis, it would worsen the bearish outlook, impacting both the short and medium term. The next support levels to watch are 1.2860 and then 1.2818. On the upside, the immediate resistance is at 1.30.

Prepared by Nour Hammoury, Chief Market Analyst at SquaredFinancial
Nour is an investor, independent market strategist, and financial advisor. He holds a BA in Finance and Banking Science from Al-Ahliyya Amman University and a CFTe in Economics from the International Federation of Technical Analysts. He has more than 15 years of experience in forex, stocks, and global economic developments, as well as central bank policies and intermarket analysis. He appears regularly on major international TV networks, such as BBC, Al-Jazeera, Al Hurra, CNBC, and Bloomberg, holding open discussions and sharing insights and readings of the markets and trends.

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