Market Focus

The broad U.S. equity market enjoyed another positive day on Friday to close out the week with positive gains. Strong 3^rd quarter earnings and healthy consumer spending propelled stocks higher on Friday. The S&P 500 gained 0.7% to close at 4471.37, the Dow advanced 1.1% to 35294.76, and the Nasdaq gained 0.5% to close at 14897.34.

The financial sector reported healthy earnings for the third quarter. Goldman Sachs Group reported earnings of $5.38 billion for the third quarter, a 60% year over year gain; meanwhile, Morgan Stanley reported a 36%, year over year, earnings gain.

Retail sales for September increased 0.7%, beating estimates. Rising retail sales figures could ease some investors’ concerns over a slowing economy and inflation.

The U.S. 10 year treasury yield rose again on Friday, and the benchmark is currently sitting at 1.574%. Oil prices leaped further on Friday as demand for oil picks up as global governments begin to ease pandemic era travel restrictions. The U.S. will lift COVID-19 travel restrivtions for fully vaccinated foreigners effective Novemeber 8^th. The Brent Crude future gained 1% to settle at $84.86 a barrel, and the WTI future gained 1.2% to settle at $82.28 a barrel.

Main Pairs Movement:

The impact of the surging US Treasury yields on the greenback was offset by the broader risk-on market sentiments, left the dollar index trading sideways on Friday. With the benchmark 10-year US Treasury bond yield holding above critical 1.5% handle, the dollar stays resilient in the early European session on Friday, but at the second half of the day, though the upbeat September Retail Sales report boosted the dollar a bit, the following Michigan Consumer Sentiment Index data.was underperformed and dragged the dollar index down the 94.00 threshold.

The EUR/USD pair is treading water on both sides of the 1.1600 level, unable to take advantage of a weaker US dollar. The sterling is the best performer among its main peers. Cable has rallied on Friday to break above 1.3750, reaching 1.3775 for the first time since mid-September. On the flip side, JPY is the worst. The USD/JPY pair surged over 0.5% during the day, now trading at 114.30. Commodity-linked currencies hovers around the familiar levels. Loonie settles at 1.2380 at the moment, and Aussie was last seen at 0.7418.

Gold lost most of its Thursday’s gains and retreated to $1767.61 a troy ounce. Crude oil prices extend further north to fresh highs. WTI trades at $82.10 as of writing, and Brent once breached $85.00 price level during the early European session, now settles around $84.70.

Technical Analysis:

GBPJPY (4-Hour Chart)

The GBP/JPY cross continued scaling higher through the first half of the European session and once surged to the highest level since June 2016. Bulls are now looking to build on the momentum further beyond the 157.00 round-figure mark.

The momentum took along some short-term trading stops placed near the previous yearly tops, around the 156.00 mark. This seemed to have prompted aggressive short-covering and further contributed to the strong bid surrounding the GBP/JPY cross. With the latest leg up, the cross has now rallied nearly 800 pips from monthly swing lows, around the 149.20 area.

Meanwhile, technical indicators on short-term charts are already flashing overbought conditions and warrant some caution for bullish traders. Hence, it will now be interesting to see if the GBP/JPY cross continues with its positive move or bulls opt to take some profits off the table heading into the weekend.

Resistance: 160.00, 163.90(July 2016 top)

Support: 156.08, 153.50, 149.22

EURUSD (4-hour Chart)

The euro keeps treading water on both sides of the 1.16 level, unable to take advantage of a weaker U.S. dollar. The common currency bounced up from year-to-date lows at 1.152 earlier this week but is missing follow through to post a significant recovery and remains hesitating between 1.158 and 1.162 for the second day in a row. The U.S. Treasury yields rally, another source of strength for the U.S. dollar, has lost steam this week.

On technical side, the RSI index floating a flat movement in day market and sitting at 57 figures, suggesting a slightly bullish movement in short term. On moving average aspect, 15-long indicator has turned it slope to positive way and 60-long became a flat movement after day market, moreover, two moving average indicator has golden cross in the day market.

In lights of two critical technical indicator are giving the euro fiber a positive signal. One thing left, the most important obstacle for the upside traction is 1.16 threshold. If it could penetrate 1.16 soild, then expect will heading to higher stage.

Resistance: 1.161, 1.166, 1.1675, 1.171

Support: 1.153, 1.15

USDCAD (4 Hour Chart)

Loonie is advancing during the New York session, up 0.19%, trading at 1.2393 at the time of writing. An upbeat market sentiment sorrounds the market portrayed by U.S. equity indexes rising between 0.17% and 0.92%. WTI, the U.S. benchmark for crude oil, which significantly influences the Canadian dollar, is rising 0.61%, trades at $81.42, failing to lift the CAD. On Friday, the BOC Governor Tim Macklem warned that the faster pace of price increases may persist longer than expect and may slow the pace of Canada’s economic recovery, as global supply-chain issues weigh on the domestic economy.

From a technical perspective, RSI indicator rebound from over sought territory to 35 figures, still suggesting bearish momentum in short term. On moving average indicator, 15- and 60-long indicator still retaining downside movement.

Since loonie break through a critical support at 1.24 around, we expect next pivotal support level will be 1.23. On up side, psychological level at 1.25 still a pivotal resistance for short-term, 1.256 following.

Resistance: 1.2425, 1.25, 1.256

Support: 1.23

Economic Data

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Market Focus

The U.S. equity market enjoyed a broad based gain on Thursday’s trading. The S&P 500 gained 1.7% to close at 4438.26, the DJIA gained 1.6% to close at 34912.56, and the Nasdaq gained 1.7% to close at 14823.43. Stocks were boosted by healthy corporate earnings and better than anticipated economic data. Goldman Sachs, BB&T, and PNC Financial services Group will release their earnings on the 15^th. Morgan Stanley topped expectations for Q3 and beat earnings estimates; furthermore, Morgan Stanley reported a 25% jump in net income year over year, despite a slowdown in fixed income trading revenue.

The U.S 10-year treasury yield continued to decline and the benchmark is currently sitting at 1.519, down 1.94% from the previous trading day.

The U.S. initial jobless claims data for the week ended October 9^th dropped to a fresh pandemic low of 293,000, the lowerst in 19 months. Importantly, labor demand seems to be on the rise as more people are coming off state unemployment rolls.

The Brent Crude spiked above $80 dollars a barrel and is currently settling at $84.31 per barrel; meanwhile, the WTI has also broken the $80 barrier to settle at $81.67 per barrel.

Main Pairs Movement:

As Treasury yields held at the lower end of the weekly range, the dollar remained weak. The yield on the 10-year US Treasury note bottomed at 1.507%, ending the day nearby. The greenback managed to post a modest intraday advance against the JPY but lost to most of its major rivals.

Upbeat US data provided additional support to the market’s mood. The September Producer Price Index was up 0.5% MoM and 8.6% YoY, higher than the August readings though below the market’s expectations, while Initial Jobless Claims for the week ended October 8 printed at 293k, much better than the 319k expected.

EUR/USD lost the 1.1600 threshold, ending the day a few pips below the level. GBP/USD settled at 1.3670, while commodity-linked currencies were the best performers. AUD/USD regained the 0.7400 mark, while USD/CAD fell to 1.2355, a fresh low since the early July.

Crude oil prices were up. The International Energy Agency said that record-breaking natural gas prices would boost demand for oil, and top oil producer Saudi Arabia dismissed calls for additional OPEC+ supply. WTI settled at $81.40 a barrel, while Brent traded over $84.00. Gold flirted with $1,800 per ounce, and hovering below that level at the moment.

Technical Analysis:

USDJPY (Daily Chart)

US dollar’s bullish attempt seen on the early US trading session has chanllenged resistance again at the 113.70 area, and the pair retreated to the mid-range of 113.00. The USD remains strong against a weaker yen, trading right below three-year highs at 113.80 following a 4% rally over the last four weeks.

The Japanese yen is trading lower against its main peers with a positive market sentiment hurting safe-havens in favor of riskier assets. The world’s major stock indexes are posting significant gains on Thursday, as concerns about surging inflation and supply chain bottlenecks have taken a backseat.

In a bigger picture, the pair remains steady near recent highs, and a further rally is anticipated, even though overbought shorter-term conditions could lead to a couple of days of consolidation first. The next resistance is at 114.02, and the USD strength is deemed intact as long as it does not drop below 112.00

Resistance: 114.02, 114.55

Support: 112.57, 112.00, 109.15

EURUSD (4-hour Chart)

The euro fiber retreat from daily high and lost the 1.16 threshold, ending the day a few pips below the level where trading at 1.1588 with 0.04% down as of writing. Earlier in the Asian session, the currency rose to a fresh weekly high at 1.1624. Upbeat U.S. data provided additional support to the market’s mood. The Sept Producer Price Index was up 0.5% MoM and 8.6% YoY, higher than the Aug readings although below the market’s expectations, while Initial Jobless Claims for the week ended Oct 8 printed at 293K much better than earlier expected.

On technical side, the RSI index has reversed from daily high at thereabout over bought threshold, suggesting a slightly bullish movement in short term. On moving average aspect, 15-long indicator has turned it slope to positive way and 60-long became a flat movement after day market.

All of all, both critical indicator are suggesting euro could heading to upward momentum, of course base on indicator. Moreover, if 15-and 60-long MA indicator could gold cross in further that would provide a profound guidance. However, we foresee 1.16 thereabout is a main resistance as neckline of W pattern. If euro fiber could penetrate immediately resistance solid, then expect it could heading to higher stage.

Resistance: 1.161, 1.166, 1.1675, 1.171

Support: 1.153, 1.15

USDCAD (4 Hour Chart)

Loonie is trading at 1.237 and down over 0.57% after falling from a highs of 1.2445 to a low of 1.2354 on Thursday so far. Loonie has strengthened to its highest level in more than three months against its U.S. conterpart, as the energy crisis underpins the nation’s biggest exporting industry. Oil price were followed up the upward traction, the International Energy Agency said that record natural gas prices would boost demand for oil and top oil producer Saudi Arabia dismissed calls for additional OPEC+ supply. The nearly WTI contract sitting at $ 81.43 per barrel as of writing. Gold flirted with $1800 at ending the day just below the level.

From a technical perspective, RSI indicator fell into over sough territory and sitting 25, still suggesting bearish momentum in short term. On moving average indicator, 15- and 60-long indicator still retaining downside movement.

Since loonie break through a critical support at 1.24 around, we expect next pivotal support level will be 1.23. On up side, psychological level at 1.25 still a pivotal resistance for short-term, 1.256 following.

Resistance: 1.2425, 1.25, 1.256

Support: 1.23

Economic Data

Daily Market Analysis

Market Focus

US markets traded higher following the release of consumer prices index. Consumer prices increased slightly more than expected in September. The rises of food and energy prices offset the declines of used vehicles prices, according to the Labor Department.

US social security cost- of- living adjustment will be adjusted 5.9% higher in 2022, according to Social Security Administration announced. Notably, the adjustment will be the biggest boost in about 40 years. Comparing to 2021, the Social Security cost- of- living was only 1.3%.

After the release of CPI, the US Federal Reserve officials broadly agreed on the plan, tapering process by mid- November. The tapering process could see a monthly reduction of $10 billion in Treasury and $5 billion in mortage- backed securities.

Main Pairs Movement:

The precious metal, gold rose to the highest in almost a month as the US Treasury yields and the US dollar declined after the release of CPI, slightly higher than the expectation. Gold price traded at $1,793, up nearly 2% on Wednesday. The upsurge of gold price could be potentially seen as the initial reaction to the inflation.

GBPUSD traded further north, trading 0.52% higher. Lower US Treasury yields undermined the demand for the greenback; however, the upside momentum of the British pound was still limited as the Brexit led- woes, weaker GDP, and worker shortage continued to be issues.

EURUSD traded similarly to GBPUSD amid the concern of US inflation and lower US Treasury yields. In the end of the day, the currency pair closed at 1.15907, 0.53% higher.

Technical Analysis:

EURUSD (4-hour Chart)

The EUR/USD pair trades at the intraday high 1.1596 as of writing. However, the current recovery could well be seen as corrective, as the pair remains below a firmly bearish 20 DMA. The MACD histogram remains flat within the negative territory, while the RSI indicator has bounced from oversold readings, yet holding below 50.

As expected, the Fed reaffirmed their previous statements in the latest FOMC Minutes: to start tapering in either Novenber or December, and to end it in mid-2022. The dull announcement did little to the market.

As to the resistence and support levels, our opinion remains unchanged. The first support appears at the 1.15 psychological level, then 1.14225, the 2020 May’s top; the resistence levels are at 1.161, 1.166 and 1.171, where the historical tops and bottoms lies. The 20 DMA is also a strong resisitence to the pair, as a breach of it marks a flip of the market sentiments.

Resistance: 1.1610, 1.1660, 1.1675,1.1710

Support: 1.153, 1.15, 1.14225

XAUUSD (4-hour Chart)

The price of gold on Wednesday has rallied as key data today, U.S. inflation data showed prices rose solidly in Sep, stoking expectations the Federal Reserve will announce a tapering of stimulus next month, with the potential for rate hikes by mid-2022. The Consumer Price index rose 0.4% last month, versus a 0.3% rise expected by economists. At the time of writing, gold is trading at 1791.99. The price has travelled from a low of 1757 to a high of 1796 where tests the 200-day EMA.

On the technical front, the 4-hour RSI index has breached the over bought territory at 72.83 figures, suggesting a overly bullish sentiment at short term. On moving average side, 15- and 60-long indicator are both heading to upside traction.

As gold penetrate 1780 psychological resistance level in New York Session, we expect market has found an accommodative bullish territory ahead while Fed boosting the tapering expectation, price action told as well. On upside, we foresee 1800 will give upside traction a barricade, far way 1830 follow.

Resistance: 1800, 1830

Support: 1783, 1758, 1750

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Daily Market Analysis

Market Focus

All major U.S. stock indices closed lower for the second straight day. The Dow lost 0.34% to close at 34378.34, the S&P lost 0.24% to close at 4350.65, and the Nasdaq lost 0.14% to close at 14465.93. Poor performance in the communications sector dragged most indices lower, while strong gains in the real estate and consumer discretionary industry helped limit losses. Macroeconomic factors including soaring commodity prices and strong global energy demand put further weight on the threat of inflation.

Oil prices remained at historical heights. The WTI gained 12 cents to settle at $80.64 per barrel, while the Brent Crude lost 23 cents to settle at $83.42 per barrel. Worldwide shortage of natural gas has helped buoy oil prices. On the other hand, the 10-year treasury yield stayed above 1.5%, but the yield experienced its largest one day drop to settle at 1.579%.

This week also signals the beginning of the third quarter earnings season. JPMorgan Chase and Blackrock will be announcing their earnings on the 13^th. Speculators are eyeing the performance of the industrial and the materials industry as global demand ticked up and these firms retain better pricing power in the face of rising costs.

Main Pairs Movement:

Another day without high-impact US data leads the risk perception became the primary driver of market movement. With major US indices consolidating in the familiar levels, the US Dollar Index continued its upweard traction and rose 0.15% on Tuesday.

Robust USD strength in the second day of the week forced most of its rival pairs to close in the negative territory. The EUR/USD pair remains within a touching distance of the 15-month low setting at 1.1529 while consolidating its losses. GBP/USD settles around the same old range at 1.3600. USD/JPY advanced to its highest level since late-2018 and seems to have gone into a consolidation phase around 113.50. Commodity-linked currencies posted mild gains against greenback. USD/CAD dropped nearly 0.1%, and AUD/USD climbed about 0.15%.

After surging more than 10% in the previous week, the benchmark 10-year US Treasury bond yield dropped significant 3.6% intraday, fueling gold’s rally. The yellow metal trades at $1760 per ounce at the moment, 0.36% higher than yesterday; Crude oil prices remains unchanged, with WTI’s at $80.50, and Brent at $83.30.

Bitcoin plummeted over 4% after renewing multi-month highs on Monday, now trading at $55,250. Ethereum trades near $3,500 on Tuesday and seems lack of momentum to keep its uptrend, as the overall risk-off mood makes the crypto currencies unattractive.

Technical Analysis:

USD/JPY (4-hour Chart)

The USD/JPY pair refreshed daily lows during the early European session, managed to defend the 113.00 mark, and quickly rebounded thereafter. The pair was last seen hovering around the 113.50-80 region, fresh highs since December 2018.

On the technical front, both the 4-hour MACD histogram and RSI indicator suggest that the USD/JPY pair is strongly bullish, even RSI breaches to the overbought territory, implying the pair might experience a correction in the short term. In our opinion, we think the pair may encounter its first resistance at the upper bound of the Bollinger Band, consolidate awhile, then keep on its uptrend. If not, then the first support for the pair lies on the 4-hour 20 SMA, then 112.00. A breakthrough of the last support 109.15 could open the Pandora’s Box of a downward trajectory.

Resistance: 114.02, 114.55

Support: 112.57, 112.00, 109.15

EURUSD (4-hour Chart)

The EUR/USD pair lingers in the narrow price interval for yet another session on Tuesday. The pair dove to the 2021 low below 1.1530 remains well on the table amid the ongoing bearish trend, at least in the short term. A further retreat from this spot should trigger a relatively quick test of the 1.1500 psychological support, where the March 2020 high sits, and a breakthrough of that will lead the pair to the last barricade ahead of a massive downfall, the June 2020 high at 1.1422.

On the technical front, the 4-hour MACD histogram has just formed a death cross, and the RSI indicator is at 35, strongly bearish but above the oversold territory, suggesting the downward traction should proceed. Moreover, the pair is now deeply below the key 200-DMA line, where the pair should cross to prove a meaningful rebound.

Resistance: 1.161, 1.164, 1.1675, 1.172

Support: 1.153, 1.150, 1.1422

USDCAD (4 Hour Chart)

The USD/CAD pair slides during the New York session is trading at 1.4635, down 0.17% around at nearly market close. The market sentiment is downbeat, portrayed by U.S. stock indices posting losses between 0.25% and 0.34%. Reasons like the energy crunch in Europe and Asia. On oil side, rising oil prices are boosting the loonie, WTI crude oil is barely unchanged at $79.9, outside of $80 per barrel threshold for the first time in two days.

From a technical perspective, RSI indicator still clinging at over sough territory at 38 in nearly two day as market faltering, remain suggesting bearish momentum in short term. On moving average indicator, 15- and 60-long indicator still retaining downside movement.

Since loonie rapidly break through a critical support at 1.25, we expect next downward support will be last July low at 1.2425. On up side, psychological level at 1.25 will turn into a pivotal resistance for short-term, 1.256 behind.

Resistance: 1.25, 1.256

Support: 1.2425, 1.23

Economic Data

Dear Client,

To reflect the market volatility more precisely, VT Markets will modify the setting of the 3-days Swap of USDTRY on Oct. 18th, 2021.

The date of USDTRY’s 3-days Swap will be changed from every Wednesday to every Thursday.

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Daily Market Analysis

Market Focus

US markets started the week with gloomy mood as the Dow Jones shed 0.7%, and the S&P 500 dropped 0.7% while the Nasdaq Composite dipped 0.6%. Stocks were mostly positive for most of the day, but selling pressure increased in the final hour, with the major indices closing the session at their lows.

US 10- year Treasury yield has risen above 1.6% as markets tried to digest a disappointing job data from last Friday. The majority of the markets believed that the latest job report did not change the fact that the Federal Reserve’s outlook for tapering its bond purchases later this year.

Singapore has announced to open its border to more countries for quarantine- free travel. The move has shown that the country is preparing to reach a new normal to live with coronavirus. It is significant as Singapore is one of the world’s biggest travel and finance hubs.

Main Pairs Movement:

USDJPY printed a fresh high since 2018, trading at 113.482, up 0.97% on Monday. With Japanese bond rates well anchored while the Bank of Japan continued to keep policy rates on ice, the potential fact of the US Fed’s tapering should bring the US dollar stronger, favoring higher dollar- yen rate.

EURUSD seesaw between gains and losses on Monday, trading at 1.15494. The currency pair would be mostly driven by the dollar this week as the European calender is scarce, only including a couple of ECB’s speakers.

AUDUSD traded 0.52 higher, closing at 0.73427. The Australian dollar was stronger against the dollar on Monday as it was on the back of Iron ore prices.

Gold price was consolidating on Monday, trading at $1,754. The bullion of gold was limited as markets awaited on the report of consumer spending and inflation for the days ahead of the FOMC.

Technical Analysis:

USDJPY (Daily Chart)

The Japan Yen is soaring during the New York session, trading at 113.38 as of writing, up over 1% in the day market. The risk-on environment, as witnessed by U.S. stock indices trading in the green, post gains between 0.43% and 0.86%. Also, the U.S. T-bond yields, with the 10-year benchmark note rate rising above the 1.6% threshold, exert upward pressure on the yen.

On technical side, RSI indicator show 79 figures that show overly bought sentiment in short-term. On moving average side, 15-and 60-long moving average are remaining the ascending traction.

All of all, yen has break through a critical resistance at 112 recently that we believe market will high probably tick up to higher level while it could maintain smooth momentum. One thing conccern is only by market has exaggerated bounce up in short term that we could not rule out market will have a correction.

Resistance: 114.55 (Oct. 2018 high), 118.60 (Jan. 2017 high)

Support: 112.00, 110.65, 109.15

EURUSD (4 Hour Chart)

The euro dollar pair is trading below 1.16, yet get off the lows as U.S. share indices advance and closed bond markets provide some calm, Concerns about enetgy costs, disappointing U.S. jobs figures and uncertainty about fiscal policy weighed on sentiment earlier. The ECB’s member, Lane seems reluctant to act to battle inflation.

On the technical, RSI continuing to trim the weakness to higher stage and close around 39, suggesting a bearish movement ahead. On average side, 15-long indicator has flatering a movement while 60-long remaing decending movement.

On slip side, we expect the last time low, 1.153 level, will give pair a short-term support guidance. If break down the threshold, we foresee the downside support will eye on psychological level at 1.15

Resistance: 1.161, 1.1675

Support: 1.153, 1.15

USDCAD (4 Hour Chart)

The U.S. dollar is attempting to pick up on Monday after a sharp decline observed in the previous three days. The pair has pull back from two months lows at 1.2445 although, so far, it has remained unable to poise a relevant recovery with the supported by higher oil price. Meantime, U.S. WTI has appreciated for the eight consecutive day, hitting 7 years highs.

From a technical perspective, RSI indicator rebound from over sought territory at 38 as writing, still suggesting bearish momentum in short term. On moving average indicator, 15- and 60-long indicator still retaining downside movement.

Since loonie rapidly break through a critical support at 1.25, we expect next downward support will be last July low at 1.2425. On up side, psychological level at 1.25 will turn into a pivotal resistance for short-term, 1.256 behind.

Resistance: 1.25, 1.256

Support: 1.2425, 1.23

Economic Data

Market Focus

The broad U.S. equity market closed lower on Friday’s trading, but most indices closed the week with gains. The Dow gained 0.8% over the week, the S&P 500 gained 1.2% over the week, and the Nasdaq gained 0.1% over the week. Despite the Senate passing a short-term extension to the debt limit on Thursday, market participants are still affected by the looming concerns over inflation and soaring short term U.S. treasury yields.

Cotton and oil prices have soared over the past week. Cotton have been trading at their highest levels in about a decade, while oil prices has spiked to a seven year high. Soaring commodity prices will weigh on inflation concerns. On the other hand, the U.S. 10-year yield has advanced through 1.6% during Friday, triggering bearing sentiment across markets.

This week’s economic docket is packed with important data releases from Britain and the U.S. The U.K. unemployment rate and monthly GDP will be released during Tuesday and Wednesday, respectively; meanwhile, the U.S. will be releasing CPI and PPI figures over Wednesday and Thursday, furthermore, FOMC minutes will be released on Wednesday as well.

Main Pairs Movement:

The highly-anticipated US Nonfarm Payrolls (NFP) rose by 194,000 in September, missing the market expectation of 500,000 by a wide margin. The greenback came under modest selling pressure after the report released. US dollar index posted a daily low at 93.940.

On a positive note, August’s print of 235,000 got revised higher to 366,000. Further details of the publication revealed that the Unemployment Rate declined to 4.8% from 5.2% in August, compared to analysts’ estimate of 5.1%. Additionally, the Labor Force Participation Rate edged lower to 61.6% from 61.7% and the wage inflation, as measure by the Average Hourly Earnings, rose 4.6% on a yearly basis as expected.

The mixed US data did little to the dollar’s strength. Most of the main pairs remain on the familiar levels, except for USD/CAD plummeting amid the surging oil price, and USD/JPY rising due to the so-called ‘Kishida Shock’, which refers to the Japanese new president Fumio Kishida and his redistribution policies.

XAU/USD lingered around $1750-60 almost a whole day. Though once gold price surged to $1781 right after the NFP released, it was soon back to the thin price range, trading at $1758.20 as of writing. WTI climbed nearly 1% today, once bounced off $80.00, the first time since October 2014. The 10-year US Treasury Yield rose around 2% and breached the 1.600 threshold.

Technical Analysis:

USDJPY (Daily Chart)

Fed’s looming bond taper and the resulting higher Treasury rates are the main order of market business. The USD/JPY will continue to rise as long as Treasury yields push higher. Despite the dismal September job numbers, markets remain convinced that the Fed will keep its word and begin a bond program reduction this year.

The USD/JPY is close to the top of its three year range. Except for the February and March 2020 panic spikes, and a few days in April 2019, the last time the pair spent any time above 112.00 was in the second half of 2018. The area above 112.00 has no recent technical impediments to a rise in the USD/JPY. However, on the flip side, we have an instant support for the pair at 112.00, followed by 110.65, strong resistence during July and Augest, then 109.15, robust support of the pair since June.

Resistance: 114.55 (Oct. 2018 high), 118.60 (Jan. 2017 high)

Support: 112.00, 110.65, 109.15

EURUSD (4 Hour Chart)

The euro is attempting to bounce up from 14-month lows at 1.1535 reaching session highs at 1.158 favored by a weaker than expected U.S. Nonfarm payrolls report. The pair, however, remains on the defensive, after having deprecated about 0.5% in a three-day decline. The greenback is pulling back against its main peers on Friday, weighed by a worse-than-expect in U.S. private employment as well. Furthermore, the unemployment rate declined to 4.8% from 5.2% in Aug.

On the technical, RSI continuing to trim the weakness to higher stage and close around 49, suggesting a neutral market movement ahead. On average side, 15-long indicator has turned it slide to uptrend while 60-long remaing decending movement. For MACD, the indicator keep extend it positive momentum.

On slip side, we expect the last time low, 1.153 level, will give pair a short-term support guidance. If break down the threshold, we foresee the downside support will eye on psychological level at 1.15

Resistance: 1.161, 1.1675

Support: 1.153, 1.15

USDCAD (4 Hour Chart)

Loonie plummet during the New York session, is trading at 1.2475, down 0.58% in the day market, touched lowest stage since July 30 after job report showed that the country has now recovered all of the 3 million jobs lost during the pandemic. Meanwile, the West Texas Intermediate crude oil futures hit $80 per barrel for the very first time since November 2014, whereas the U.S. 10-year Treasury yield is rising and sitting 1.6% as of writing.

From a technical perspective, RSI index has slipped into over sought territory where sitting 24.3 as of writing, suggesting overly sell off sentiment at the moment. On moving average indicator, 15- and 60-long indicator still retaining downside movement.

Since loonie rapidly break through a critical support at 1.25, we expect next downward support will be last July low at 1.2425. On up side, psychological level at 1.25 will turn into a pivotal resistance for short-term, 1.256 behind.

Resistance: 1.25, 1.256

Support: 1.2425, 1.23

Economic Data

Daily Market Analysis

Market Focus

US markets rallied on Thursday as lawmakers finally reached a deal to increase the debt ceiling in the short- term. In short, the Dow Jones jumped roughly 1%; the Nasdaq rose 1.1% while the S&P climbed 0.8%. The majority of stocks turns upside as investors temporary relieve on the news of the US will avoid an unprecedented default for now. As of now, markets await on the release of non-farm payrolls, which are scheduled on Friday.

Asian market set to open higher as China markets are going to resume after a week- long holiday, known as the golden week. In China, markets are likely to concentrate on the debt woes in its property sector and Beijing’s updated regulation, taking steps to limit monopolistic behaviors.

Elsewhere, oil prices rebounded after the US mentioned it has no plan at the moment to increase the output in order to calm rising oil prices. In the meantime, iron ore price looks to wriggle as markets see the strength amid concerns that Chinese demand is evaporating.

Main Pairs Movement:

Gold slid on Thursday, down 0.43%, after the US economy looks to gradually recover according to the jobless data on Wednesday. With the ongoing improvement in the labor market, the US Fed is likely to pace up the reduction of its monetary support soon. The price of bullion is likely to undulate from Friday’s non- farm payrolls data. As of now, gold is waiting for catalysts to move up and down.

WTI crude oil held steadily high as the energy benchmark cheered for the upbeat market sentiment. Oil price got fueled by the US Energy Department suggested that there will be no consideration as of now to release and increase the national reserves, keeping the oil supply crunch on the table.

The Japanese Yen looks to undermined against the US dollar as the US bond yields rise, which potentially reduces the interest for the haven currency. By the end of the day, USDJPY closed with 111.607, 0.19% higer.

Technical Analysis:

USDJPY (4 hour Chart)

The USD/JPY pair recovered over 30 pips from the daily swing lows and climbed to fresh daily tops, last seen around the 111.60 region during the North American session.

A combination of factors assisted the USD/JPY pair to attract some dip-buying near the 111.20 region on Thursday. The risk-on impulse in the markets was seen as a key factor that undermined the safe-haven Japanese yen and extended some support to the major. This, along with a modest pickup in the US dollar demand, provided a modest lift.

For buyers to resume the attack to 112.00 and beyond, they would need a daily close above 111.50. In case of that outcome, the next supply zone would be 112.00; on the flip side, the first support level is 111.00, followed by the September 8 high at 110.42, then at 110.00.

The RSI indicator is at 62.50, modestly bullish, suggesting the consolidation of the pair may come to an end and the uptrend resumes.

Resistance: 112.00, 114.26 (Oct. 2018 high)

Support: 111.00, 110.42, 110.00

EURUSD (4 Hour Chart)

After two consecutive days of printing red, reacing a new yearly low at 1.1528, the pair is staging a comeback, is trading at 1.1564, modestly up 0.06% in the day market, during the New York session, at the time of writing. The market mood is turning to risk-on mode, portrayed by European stock indices finishing the day with hover between 1.17% and 2.14%. Meanwhile, major US stock indices rise more than 1%, during the day. The U.S. debt-limit increase solution, although short-term relieved market nervousness.

On the technical, RSi indicator pull back from over sought territory to 35 figure, however, still suggesting a bearish sentiment at current stage. On moving average side, 15- and 60-long indicator both retaining decending movement. On the other hand, MACD is holding 0 which lack of a movement suggestion.

On slip side, we expect the last time low, 1.153 level, will give pair a short-term support guidance. If break down the threshold, we foresee the downside support will eye on psychological level at 1.15

Resistance: 1.157, 1.161, 1.1675

Support: 1.153, 1.15

USDCAD (4 Hour Chart)

Loonie break below critical support of last day and once 1.254 in the day market where is the lowest level since Sept 7. It remains near the lows with a bearish intraday bias, favored by a wearker dollar and higher crude oil price. The U.S. dollar index is down 0.09%, sitting at 94.14. Furthermore, the U.S. 10 years T-bond benchmark note is advancing where sit at 1.565% as of writing, putting the breaks on the buck’s fall against major currencies. On political side, the President of Russia, offered an increase of the natural gas supplies for Europe to deal with over spike in energy price.

From a technical perspective, RSI index fell to 34 figure, consecutive suggesting a bearish momentum ahead. On MACD side, indicator turn into negative territory, suggesting a downside movement.

For the slip way, we expecting effectively support will between 1.255 and 1.256. Moreover, if market slip below 1.255, we see next support will be 1.25. On up way, the first resistance will be psychological level at 1.26

Resistance: 1.256, 1.26, 1.2635

Support: 1.255, 1.25

Economic Data