Dear Client,

Warmly reminds you that the component stocks in the stock index spot generate dividends. When dividends are distributed, VT Markets will make dividends and deductions for the clients who hold the trading products after the close of the day before the ex-dividend date.

Indices dividends will not be paid/charged as an inclusion along with the swap component. It will be executed separately through a balance statement directly to your trading account, the comment for which will be in the following format “Div & Product Name & Net Volume ” .

Please note the specific adjustments as follows:

Note: The above data is for reference only, the actual execution data may be changed, please refer to the MT4 software for details.

If you’d like more information, please don’t hesitate to contact [email protected].

Daily Market Analysis

Market Focus

U.S. stocks fell in volatile trading as mixed economic data kept investors on edge about the timing of stimulus tapering even as the relentless spread of the Covid-19 delta variant undermines global growth. The S&P 500 notched a fourth straight decline after erasing an intraday gain that had brought it to within 0.4% of its all-time high. The dollar weakened and 10-year U.S. Treasury yields declined. European equities fell, with the Stoxx 600 erasing the initial advance it saw after the European Central Bank said it will slow its emergency support but keep policy accommodative.

The European Central Bank will slow the pace of its pandemic bond-buying program in the final quarter of 2021, a shift President Christine Lagarde insists isn’t a move heralding a wind-down in stimulus for the euro-region’s still-vulnerable recovery.

Lagarde spoke after the Governing Council decided it will conduct purchases at a “moderately lower pace” than the roughly 80 billion euros ($95 billion) of monthly acquisitions deployed in the past two quarters. She justified the decision by saying the euro region’s “increasingly advanced” rebound could be maintained with less monetary help.

The president also cautioned that the global spread of the delta variant could yet delay the full reopening of the economy. Officials, who revealed new forecasts showing inflation will still undershoot their target, reiterated a pledge to keep the 1.85 trillion-euro program running until March 2022 or later if needed, signaling they’re not yet ready to discuss ending the measure.

The ECB’s move to persist with stimulus contrasts with major central banks elsewhere, a differing stance Lagarde’s comments implicitly emphasized. The U.S. Federal Reserve and the Bank of England have signaled their intention to gradually unwind crisis-era aid.

The timetable for slower purchases in the next three months now makes the Dec. 16 meeting a crucial one for the future of the central bank’s stimulus programs. While the president said the decision was unanimous, keeping that consensus may be a challenge among policy makers whose judgments on the threat posed by inflation are known to differ.

Main Pairs Movement:

Cable shined amid a quiet day in the forex space, gained 0.5%. The surge in Cable is more convincing from a technical perspective rather than a fundamental one. That said, Cable’s fundamental outlook is mixed. On the positive side, BoE Governor Bailey and other MPC members see minimal condition to consider rate hike has been met. But, upcoming increase in tax rate proposed by Prime Minister Borris Johnson may weigh on the Sterling.

Euro dollar was mostly muted on Thursday despite ECB’s announcement of winding down monthly asset purchases to 60 to 70 billion euros. In the past two quarters, the PEPP program devoted 80 billion euros every month to help prop up the united economy. As health authorities around the world started to roll out vaccination in the beginning of the year, Euro Zone has seen COVID-19 infections dropped significnatly as of late, and economic activities are set to return to normal. However, ECB is still a long way from nudging interest rate to above 0% as President Largarde repeatedly reminded that this is NOT a “taper”.

We have seen relatively strong performance in safe-haven dollar, the Japanese Yen and Swiss Franc, climbed 0.49% and 0.54% respectively. The move was consistent with a drop in US Treasury yields, with the 10-year yield down 0.38%. An increase in demand for hedging may foreshadow a retreat risk appetite in the financial market as concerns of a freshly emerged variant, which has come be known as the ‘Mu’ variant, may pose challenge to current recovery around the globe. The lastest WHO report suggest ‘Mu’ variant can surpass immune defence and cause infection. More importantly, it is already making its presence internationally, and has spread to over 49 US states and 40 different countries worldwide.

Technical Analysis:

CHFJPY (Daily Chart)

CHFJPY is edging its way toward the lower bound of a big ascending tunnel, and threatened for a breakout to the downside. Prices continues to be choppy in the past few days after neck-line of a double-top pattern, coincided with the purple descending trendline, managed to cap further upward moves.

Given price is gradually deviating from a heavily guarded resistance zone bove, the odds are favouring sellers. In order to establish a convincing bearish reversal, sellers will have to breach support line at 119.2 and the aforementioned ascending trendline. If succeeded, we could be looking at further downside space at 117.4 and 115.74, levels that were last seen in April.

Resistance: 120.55, 122.8

Support: 119.2, 118, 116.9

GBPUSD (Daily Chart)

Cable shrugged off bearish moves in the last three days, advanced 0.5% on Thursday. This pair registered a long lower wick yesterday as price plunged as much as 0.43%, then rebounded on 61.8% Fibonacci support of 1.373, and settled above SMA20. The fact that price failed to penetracte SMA20 is leading up today’s surge.

In a broader picture, we could see Cable broke above a three-month descending trendline, then retraced downward to validate the breakthrough was solid. Now the bullish reversal is coming close to completion, the last obstacle would be previous high of 1.3874. Further in the north, big resistance sits around 1.396 and 1.41, the former has been keeping Cable subdued since June.

Resistance: 1.387, 1.396, 1.41

Support: 1.373, 1.367, 1.357

EURJPY (Daily Chart)

Selling bias for EURJPY is being carried over on Thursday, plunged 0.36%. This pair has formed a small double-top pattern, and today’s leg lower aided to finish up the formation. There is limited downside space to capitalize on. As we highlighted in the daily chart, bulls has set up a defense zone around 129.3 and 129.5. This zone could collaborate with SMA20 to provide robust support to EURJPY.

On the upside, bulls will look to contest recent high of 130.56. If conquered, doors will be wide open to potential upward move to 132.2. Conversely, any radical downside plunges will be bounded by 128.38.

Resistance: 130.56, 132.2, 134.13

Support: 129.3-129.5, 128.38

Economic Data

Daily Market Analysis

Market Focus

U.S. equities retreated as investors reassessed valuations in light of global economic risks including the spread of the Covid-19 delta variant and reductions in central bank stimulus.

The Nasdaq 100 was headed toward its biggest drop in two weeks, with losses in megacaps including Apple Inc. and Facebook Inc. contributing most to the decline. The S&P 500 fell for a third day since it closed at a record on Sept. 2. The Dow Jones Industrial Average extended its retreat from last month’s all-time high to more than 1.5%. Europe’s Stoxx 600 dropped to a three-week low. Cryptocurrency-exposed stocks slumped as a selloff in Bitcoin continued.

Wednesday’s declines came as money managers from Morgan Stanley to Citigroup have turned cautious on U.S. equities. Many investors have begun to see relative U.S. valuations as excessive even as growth elsewhere suffers from renewed Covid lockdowns and travel curbs. They doubt the world is ready for an eventual tapering of central-bank stimulus even as inflation accelerates due to supply shocks. End-of-year seasonality and valuation concerns are adding to the gloomy mood.

In Europe, growth concerns were compounded by speculation that the European Central Bank is getting ready to slow down emergency stimulus. Meanwhile, the continued spread of Covid-19 is curbing economic activity around the world. The Philippines backtracked on easing curbs in the capital region, while Japan may extend state of emergency orders. Taiwan identified a delta variant outbreak in New Taipei City.

Main Pairs Movement:

The recent rebound witnessed in US dollar continued on Wednesday, as greenback reached the highest level since August 27 during American session. The US dollar’s strength was mainly caused by the broader market risk sentiment, investors worried that the surge in delta variant cases around the world could obstruct the global economic recovery, therefore benefitted the safe-haven US dollar. The DXY index is at 92.662 as of writing, rising 0.15% on a daily basis. The greenback finds demand amid the souring market mood. Furthermore, US JOLTs Job Openings released on Wednesday gave a better-than-expected reading. And Fed’s John Williams also suggested that it’s appropriate to start tapering this year.

EUR/USD and GBP/USD both declined on Wednesday amid stronger US dollar across the board, trading at 1.1823 and 1.3780, respectively. EUR/USD was trading lower on Wednesday, once falling under 1.1805 level and posted a 0.12% loss on the day as of writing. Market focus now shifts to the European Central Bank’s interest rate decision on Thursday.

USD/JPY edged lower today, as the pair failed to preserve its upward traction in early trade and took a hit right after the European session began. The pair is trading at 110.23 and posted a 0.02% loss on the day as of writing.

Gold slipped on Wednesday, as the bearish momentum last for the third consecutive day. The raising demand of US dollar and a risk-off environment keep putting selling pressure on gold. The precious metal is now trading at 1788.82, losing 0.29% on a daily basis. WTI Crude Oil, on the contrary, soared more than 1.4% on Wednesday.

Technical Analysis:

GBPUSD (4-hour Chart)

The GBP/USD pair declined on Wednesday, touching a fresh weekly low during European trading hours. Despite trying to bounce back above 1.3790, it is still lower for the day. The cable was last seen trading at 1.3777, losing 0.06% on the day as of writing. The recent rally in US dollar keep weighing on the British Pound. Meanwhile, British Prime Minister Boris Johnson plans to introduce a new 1.25% health and social-care levy on earned income, which also limit any meaningful recovery for the GBP/USD pair.

For technical aspect, RSI indicator 42 figures as of writing, suggesting tepid bear-movement ahead. The MACD indicator also shows a negative histogram which indicates a bearish signal. In conclusion, we think market will be bearish. But for the Bollinger Bands, price seems to rise back inside the band after falling out of the lower band, therefore, invstors should look for signs of trend reversal.

Resistance: 1.3857, 1.3892, 1.3958

Support: 1.3731, 1.3680, 1.3602

USDCAD (4- Hour Chart)

The USD/CAD pair advanced on Wednesday, reaching the highest level since August 23 for a time. The pair rallied after the BoC interest rate decision was released, but then slipped deeper back to 1.2648, eliminating most of its profits. The pair is trading at 1.2670 at the time of writing, posting a 0.19% gain on a daily basis. The Bank of Canada decided to keep its overnight rate unchanged at 0.25% and the QE program is also maintained at C$ 2 billion per week. The dovish monetary policy provide some positive momentum for the USD/CAD pair.

For technical aspect, RSI indicator 68 figures as of writing, suggesting the buying power is relatively stronger. The MACD indicator also shows a positive histogram which indicates a bull market. In conclusion, we think market will be bullish as the pair heads to test the 1.2708 resistance, a break above that level will open the door for additional near-term profits. The next resistance sits at 1.2834.

Resistance: 1.2708, 1.2834, 1.2949

Support: 1.2581, 1.2520, 1.2494

AUDUSD (4- Hour Chart)

The AUD/USD pair was trading higher in early trade on Wednesday, but the bullish momentum didn’t last long. The pair dropped to fresh seven-day low and dipped further during American session. A stronger US dollar across the board leaves the AUD/USD pair in the negative territory. On top of that, the RBA released its interest rate decision on Tuesday, as they kept the benchmark interest rate at 0.1%, same as market’s forecast. But the delta outbreak made the central bank decide to extend the bond purchases, which weighed on the Australian dollar. At the time of writing, the pair is trading at 0.7379, losing 0.06% on the day.

For technical aspect, RSI indicator 43 figures as of writing, suggesting tepid bear-movement ahead. The MACD also falls below the signal line, which means the pair is likely to experience downward momentum. In conclusion, we think market will be bearish as the pair is now testing the 0.7356 support. For Bollinger Bands, the price is now sitting between the moving average and the lower band, which also indicates a bear market.

Resistance: 0.7468, 0.7534

Support: 0.7356, 0.7285, 0.7222

Economic Data

Daily Market Analysis

Market Focus

The S&P 500 and Dow Jones Industrial Average declined, while gains in heavyweight tech stocks including Netflix Inc., Amazon.com Inc. and Apple Inc. pushed the Nasdaq 100 higher even as about seven out of every 10 stocks in that gauge dropped. European markets slipped as investors speculated that euro-zone policy makers may get ready to roll back stimulus. The greenback strengthened for a second day amid rising bond yields and softer commodity prices. Bitcoin plunged as El Salvador became the first country to adopt it as legal tender Tuesday.

The largest cryptocurrency fell as low as $43,050 in New York Tuesday, before paring losses. Bukele said his country had taken advantage of the crash to “buy the dip”, adding 150 coins to take its total holding to 550, worth about $26 million.

El Salvador’s plan represents the biggest test for Bitcoin in its 12-year history. Both enthusiasts and detractors of cryptocurrencies are monitoring the experiment to see if a significant number of people want to transact with Bitcoin when it circulates alongside the U.S. dollar, and whether it brings any benefits to the violent, impoverished Central American nation.

If the experiment is a success, other countries may follow El Salvador’s lead. Its adoption will get an initial boost from the government’s Bitcoin wallet Chivo, which comes pre-loaded with $30 worth of the currency for users who register with a Salvadoran national ID number.

Businesses will be required to accept Bitcoin in exchange for goods and services and the government will accept it for tax payments. The plan is the brainchild of El Salvador’s 40-year-old president, who says it will draw more people into the financial system and make it cheaper to send remittances

“This is brave new world stuff,” said Garrick Hileman, head of research for the London and Miami-based Blockchain.com. “We are in unchartered waters with this launch, but I’m glad to see this experiment happen overall, and I think we’ll learn a lot from it.”

Main Pairs Movement:

The US dollar traded higher after surge in delta-variant infections weigh on risky currencies, the dollar index climbing 0.37% on Tuesday. According to Reuters’ data, there were more than 20,800 people died from the coronavirus in the United States in the last two weeks, that is a 67% increase from prior two weeks. Situations in Australia and New Zealand are not so encouraging as both governments look to extend lockdowns further in the second half of 2022.

USDCAD surged 0.9% amid weaker oil prices. The Bank of Canada will announce its interest rate decision on Wednesday. Though Governor Tiff Macklem hinted their intention to lift interest rate in the second half of this year, but investors doubt that they will act in September. That said, BoC is likely to path their way toward a rate hike during tomorrow’s meeting.

Euro was the most resilient currency against the dollar greenback during Tuesday’s session albeit dropped 0.25%. The shared currency was underpinned by market optimism surrounding ECB’s meeting on Thursday. Analysts expect ECB to undergo a debate to cut its current PEPP weekly purchase of 80 billion euros to 60 billion euros. Given ECB’s past unpleasant experience at failing to achieve 2% inflation target, July’s overshoot of 2.2% Harmonized Index of Consumer Index marked a milestone for policy makers. And with the PEPP comes to an end on March 22, 2022, central bankers need to the afterlife of a ultra-loose monetary policy.

Technical Analysis:

EURUSD (Daily Chart)

Euro dollar was restrained from advancing beyond 1.189, retreated mildly on Tuesday. It successfully capalized on decent upside gains after conquering a dynamic resistance at SMA20. However, the stubborn road block at 32.8% Fibonacci of 1.189 continues to ward off bulls’ attempt to break above.

We expect the single currency to trade marginally lower against the dollar prior to ECB’s critical policy announcement on Thursday. With market participants look to hear a less dovish tone from the ECB, a lower price could provide some leeway for upward surge.

On the downside, nearest support line sits around 1.18, followed by 1.166. Up in the north, bulls could contest 1.198 and 1.1207 if they could take out 1.189.

Resistance: 1.189,1.196, 1.2

Support: 1.18, 1.166

NZDCHF (Daily Chart)

NZDCHF remains bullish despite snapping a ten-winning streak. This pair broke above a seven-months downward tunnel with robust buying bias. Though some may think current price is overstreched, and some sort of pullback should unfold soon. But we believe bulls could at least challenge resistance at 38.3% Fibonacci of 0.6567 before it could stage a retreat toward 0.65 or 0.644. The RSI indicates price is on the cusp of stepping into overbought zone, which provides incentive for buyers to continue to drive price higher, and as soon as price is overheated, they could exit current longs.

The fact that NZDCHF had a convincing breakthrough on SMA20 on the weekly chart has signaled a bullish reversal. All in all, we see further upside gains in NZDCHF in a longer investment horizon. A modest retreat could be very healthy to sustain such bullish trend.

Resistance: 0.6567, 0.6645, 0.677

Support: 0.65, 0.644, 0.6353

XAUUSD (Daily Chart)

Gold plunged to two weeks’ low at $1795 after failing to surpass a stern resistance at $1835.

Current retreat could be seen as a validation of $1795 support, which acted as a neckline for previous double-top pattern. This horizontal support could also collaborate with dynanmic SMA20 to eke out Gold price. That said, the odds are favouring buyers, and we expect another contest of $1835 to take place soon.

However, it is still unclear whether it could gather enough momentum for a solid upward breakout in the near term. We would not be surprised if the yellow metal enters consolidation mode for the rest of September given the lack of price movers in the market. Investors already knew the Federal Reserve will not taper until November or December.

Resistance: 1860, 1910, 1950

Support: 1797, 1768, 1728

Economic Data

Daily Market Analysis

Market Focus

Global stocks rose for a seventh day and U.S. equity-index futures rallied as investors bet slower hiring in the world’s largest economy may delay a tapering of Federal Reserve stimulus. Aluminum hit a decade high amid political unrest in Guinea.

MSCI Inc.’s gauge of world stocks gained for a fourth day even as U.S. markets were closed for Labor Day. In Europe, the Stoxx Europe 600 Index rose the most in six weeks, led by technology shares. Contracts on the S&P 500 Index climbed 0.2%. Aluminum supplier Norsk Hydro ASA jumped to a 13-year high in Oslo. Gold bounced between losses and a gain of 1.9%.

The latest U.S. jobs report threw traders’ calculations awry after they braced for an announcement of tapering at the Fed’s September meeting. The world’s largest economy added only 235,000 jobs in August — the smallest gain in seven months — boosting chances of a delay in that announcement.

“Expectations of a delay in Fed tapering as well as a new administration in Japan is supporting equity markets and we expect this to continue,” said Sebastien Galy, senior macro strategist at Nordea Investment Funds. “Buy-on-dip is as robust as ever, taking negative news such as U.S. nonfarm payrolls as good news which is typical of an advanced carry trade.”

Aluminum hit the highest in over a decade as political unrest in Guinea fueled concerns over supply of the raw material needed to make the metal. A unit of the military seized power and suspended the constitution, raising the possibility of disruption to bauxite shipment from the key global supplier.

Main Pairs Movement:

After slumping to a three-week low last Friday, the US dollar rebounded back on the first day of new trading week. The strong selling pressure on US dollar last Friday was caused by disappointing Nonfarm Payrolls data, as the report missed the market expectation of 750,000 by a wide margin. The DXY index is at 92.222 as of writing, rising 0.11% on a daily basis. Trading conditions remain thin due to the Labor Day holiday in the US. But concerns about slowing global growth supported the safe-haven currency, therefore, lifted the greenback up to post a moderate comeback.

EUR/USD and GBP/USD both declined on Monday amid stronger US dollar across the board, trading at 1.1868 and 1.3834, respectively. EUR/USD was trading lower on Monday, once falling under 1.1860 level and posted a 0.08% loss on the day as of writing. The European Central Bank will release its interest rate decision on Thursday.

USD/JPY advanced today, as the pair gained positive traction first, then steadily hovering around 109.8 level during American session. The pair is trading at 109.84 and posted a 0.014% gain on the day as of writing.

Gold slipped on Monday, as the raising demand of US dollar weighed on the metal throughout the day. Gold’s movement seems to be a correction of last Friday’s upsurge. The precious metal is now trading at 1822.94, losing 0.17% on a daily basis. WTI Crude Oil, in a similar way, dropped more than 0.4% on Monday.

Technical Analysis:

GBPUSD (4-hour Chart)

The GBP/USD pair declined on the first day of a new trading week, dropping below 1.3820 level at one time. The pair was surrounded by selling pressure and failed to bounce back during American trading hours. The cable was last seen trading at 1.3828, losing 0.25% on the day as of writing. The bearish movement witnessed in GBP/USD is result from the raising demand of US dollar. Meanwhile, looming Brexit concerns between the UK and the European Union over the Northern Ireland protocol also weighed on the British Pound. For technical aspect, RSI indicator 55 figures as of writing, suggesting tepid bull-movement ahead. But the MACD indicator shows a negative histogram and a death cross, which indicates a bearish signal.

In conclusion, we think market will be bearish as long as the 1.3892 resistance line holds. As for the Bollinger Bands, price is falling from the upper band and crossing above the moving average, as a result, the lower band becomes the loss target.

Resistance: 1.3892, 1.3958

Support: 1.3767, 1.3731, 1.3680, 1.3602

USDCAD (4- Hour Chart)

The USD/CAD pair was trading higher on Monday, then failed to climb higher during European session. The pair is trading at 1.2530 at the time of writing, posting a 0.05% gain on a daily basis. Following last two week’s slip, USD/CAD rebounds slightly amid stronger US dollar and the selling pressure witnessed in crude oil prices. For technical aspect, RSI indicator 39 figures as of writing, suggesting bear-movement ahead. For the Bollinger Bands, the price is now sitting between the lower band and the moving average, which also indicates a bear market.

In conclusion, we think market will be bearish as the pair is heading to retest the 1.2494 support, a break below that level will open the door for additional near-term losses. And the next support is at 1.2453. On top of that, the Bank of Canada will announce its interest rate decision on Wednesday, as the market expect BoC to raise rates in the second half of 2022 when inflation consistently hit 2%.

Resistance: 1.2559, 1.2638, 1.2708

Support: 1.2494, 1.2453, 1.2422

AUDUSD (4- Hour Chart)

The AUD/USD pair retreated on Monday and tooked a hit in early trade during Asian trading hours. It has been hovering around 0.7435 since then. The raising demand of US dollar and concerns about Delta cases are both putting pressure on AUD/USD. Victoria and New South Wales remain under lockdowns as Covid cases continue to rise. At the time of writing, the pair is trading at 0.7433, losing 0.22% on the day. For technical aspect, RSI indicator 66 figures as of writing, suggesting that the market is near the overbought zone, investors should note for possible selling signals. The MACD also falls below the signal line, which means the pair is likely to experience downward momentum.

In conclusion, we think market will be bearish as long as the 0.7478 resistance line holds. For Bollinger Bands, the pair is now falling from the upper band after touching it, which indicates a bear market. Furthermore, Reserve Bank of Australia will release its interest rate decision on Tuesday, the focus will be whether the RBA delays its tapering plans due to Covid-19 epidemic.

Resistance: 0.7478, 0.7534

Support: 0.7395, 0.7356, 0.7285

Economic Data

Dear Client,

Warmly reminds you that the component stocks in the stock index spot generate dividends. When dividends are distributed, VT Markets will make dividends and deductions for the clients who hold the trading products after the close of the day before the ex-dividend date.

Indices dividends will not be paid/charged as an inclusion along with the swap component. It will be executed separately through a balance statement directly to your trading account, the comment for which will be in the following format “Div & Product Name & Net Volume ” .

Please note the specific adjustments as follows:

Note: The above data is for reference only, the actual execution data may be changed, please refer to the MT4 software for details.

If you’d like more information, please don’t hesitate to contact [email protected].

Daily Market Analysis

Market Focus

Disappointment over the U.S. August payroll report is all but certain to push Federal Reserve policy makers to delay considering a move to scale back asset purchases at their Sept. 21-22 meeting.

The addition of 235,000 jobs last month, falling well short of forecasts and the smallest jobs gain in seven months, suggests U.S. central bankers will need to see additional gains before starting to slow bond buying, economists said Friday following the Labor Department release.

Officials wants to see “substantial further progress” in jobs and inflation, and the hiring slowdown — blamed on a flare-up in Covid-19 cases — means moves in November or December are now more likely.

Stocks barely budged after Bloomberg News reported that Democratic lawmakers are considering slapping an excise tax on stock repurchases or treating them as taxable dividends as a way to offset some spending proposals.

On the face of it, that could see corporations slow the flood of cash into buybacks — some $370 billion already this year — that some argue props up share prices. But a possible proposal by one party, even the one with control of both legislative bodies, is a very long way from becoming law.

And if it did become enacted, the chances that the tax would have a meaningful impact on stocks remains low, money managers argued. With government spending and Federal Reserve largesse juicing the economy, dip-buyers have yet to let the S&P 500 Index decline by much more than 4% this year before swooping in.

The S&P 500 was little changed near an all-time high in trading volume 20% below the 30-day average, with many investors starting early on the three-day weekend.

Main Pairs Movement:

Non-US currencies flourished against the US dollar amid a devastating jobs report on Friday. August’s Non-Farm Payrolls figure printed 235,000, far missing anticipated 750,000. The concerning data indicated recovery in the labor market remains stalled. Spiking delta variant infections could contribute to the slowdown.

Today’s ugly NFP figure may foreshadow September’s number, which the Federal Reserve is desperately praying for. Given the importance between school season and parents’ availability, September’s NFP will critically determines the fate of Fed’s tapering program. It has to deliver a perfect report, similar to the one in July, in order to start unwinding its asset purchases.

Gold gained 1% to close the day around $1830. Judging from the performance in the US labor market, Gold should be well placed in an upward trajectory. However, big Gold ETF’s holding is somewhat contrary to current trend. The SPDR Gold ETF reduces holdings in the yellow metal by 103,000 ounces for the week of August 30^th, the lowest volume recorded since last April. This suggests current incline in price may be temporary or pure speculative, and position could reverse quickly.

Technical Analysis:

XAUUSD (Daily Chart)

Gold climbed to one-month high of $1830 amid disappointing jobs data in the United States. The precious metal has made a remarkable comeback from a mini flash crash on August 9^th, surged nearly 9% from the lowest point in the past six-months. Price is battling with a stubborn resitsance at $1830 handle. However, the sustained pressure is likely to ease this time around.

The big miss in NFP report provided strong incentives for central bank policy makers to further delays the timing of tapering asset purchases, which in turn deepens market concerns of short term inflation outrunning Fed’s policy. For the time being, price will rest around $1830 to close the week. But given the pessimism surrounding today’s NFP report, we believe plenty of institutional investors will at least increase the hedge positions in Gold, therefore lifting price. In the north, Gold will look to break $1830, and advance to 23.6% Fibonacci resistance of $1860. The high of $1910 may be a bit overstrenched in the near term, but could definitely be a target for further Fed’s dovish tone.

Resistance: 1860, 1910, 1950

Support: 1797, 1768, 1728

GBPUSD (Weekly Chart)

Cable pulled off a remarkable run since last March’s big plunge, but has been trapped in consolidation zone between 1.39 and 1.36 recently. This pair gained 0.93% during this week thanks to weaker dollar demand.

After spending two-months trading beneath the SMA20 on the weekly chart, it finally has another opportunity to contest this dynamic resistance. Furthermore, a decending trendline failed to cap price under, which could signal the beginning of a bullish reversal. We still need today’s strong momentum to carry over to next week in order to complete a trend reversal.

On the upside, buyers could be eyeing to take down 1.4 hurdle, which opens up doors to May’s high of 1.423. Downside risk will be cushioned by 1.374, followed by 1.36.

Resistance: 1.4, 1.423

Support: 1.374, 1.36

NZDCHF (Daily Chart)

NZDCHF is on the tenth winning streak, rose 4.5% in two weeks. This pair broke above a seven-months downward tunnel with robust buying bias. It is about to hit the upper bollinger band, which conincides with 38.3% Fibonacci of 0.6567. We expect it to briefly touch this level before any pullbacks could materialize. The RSI indicates price is on the cusp of stepping into overbought zone, and could help to cool off an overheated bull.

All in all, we see further upside gains in NZDCHF in a longer investment horizon. A modest retreat could be very healthy to sustain such bullish trend. On the south, a good rebounding point would be 50% Fibonacci support of 0.65, followed by 0.644.

Resistance: 0.6567, 0.6645, 0.677

Support: 0.65, 0.644, 0.6353

Economic Data

Daily Market Analysis

Market Focus

Stocks rose ahead of a key jobs report that will shape bets on the path of interest rates and the Federal Reserve’s massive bond-buying program. The S&P 500 closed at a fresh record, with energy and industrial shares among the biggest gainers. Technology underperformed. The U.S. probably added 725,000 jobs in August — a more moderate pace compared to each of the prior two months, but stronger than gains seen early this year. Atlanta Fed President Raphael Bostic said “we’re going to let the economy continue to run until we see signs of inflation,” before stepping in on rates.

Democrat senator Joe Manchin is demanding a “strategic pause” in action on President Joe Biden’s economic agenda, potentially imperiling the $3.5 trillion tax and spending package that Democratic leaders plan to push through Congress this fall.

“By placing a strategic pause on this budgetary proposal, by significantly reducing the size of any possible reconciliation bill to only what America can afford and needs to spend, we can and will build a better and stronger nation for all our families,” Manchin said in the op-ed.

Manchin’s resistance to the core of Biden’s economic plan caps a politically painful month for a White House that has grappled with a chaotic withdrawal from Afghanistan, a resurgent pandemic and a massive hurricane that cut a path of death and damage from Louisiana to New York.

In comments Wednesday at an event hosted by the West Virginia Chamber of Commerce, the moderate Democrat said his party should “hit the pause button.” Lawmakers, he said, have too many other pressing issues before them, including heightening national security concerns after the Taliban takeover of Afghanistan.

“Let’s sit back. Let’s see what happens. We have so much on our plate,” he said.

Main Pairs Movement:

The US dollar declined and gave a poor performance on Thursday, dropping to the lowest level since August 6 during American trading hours. The DXY index is at 92.226 as of writing, losing 0.29% on a daily basis. The greenback continues its bearish traction ever since Fed Chair Jerome Powell’s dovish speech last week. Market worries about that the rising US COVID-19 cases in recent weeks will stall the US economic recovery, therefore, postponed Fed’s bond tapering plan. Despite better-than-expected US economic data released today, as Initial Jobless Claims reduced to 340K, the reports failed to help the US dollar gather strength. Investor now wait for the critical US Nonfarm Payrolls this Friday, which reflects the recovery condition of US economy.

EUR/USD and GBP/USD both advanced on Thursday amid weaker US dollar across the board, trading at 1.1875 and 1.1833, respectively. EUR/USD recorded a fresh four-week high during American trading hours, climbing above the 1.1874 level and posting a 0.31% gain on the day as of writing.

USD/JPY edged lower today, hovering around 110 level most of the time. The pair is trading at 109.93 and posted a 0.04% loss on the day as of writing.

Gold slipped on Thursday, touching a two-day low during American session. The recent strong bullish momentum witnessed in the global equity markets continued to weigh on traditional safe-haven assets like gold. The precious metal is now trading at 1810.24, losing 0.17% on a daily basis. WTI Crude Oil, on the contrary, soared more than 2.1% on Thursday.

Technical Analysis:

GBPUSD (4-hour Chart)

The GBP/USD pair made a good showing on Thursday, as the pair gained bullish momentum and climbed above 1.3800 level during American trading hours. The cable was last seen trading at 1.3835, rising 0.48% on the day as of writing. The bullish movement witnessed in GBP/USD is result from the diminishing demand of US dollar, meanwhile the improving market mood pushs Wall Street’s main indexes higher. For technical aspect, RSI indicator 68 figures as of writing, suggesting that the market is bullish, and the buying pressure is relatively higher. As for the Bollinger Bands, the price moves out of the upper band, indicates that a strong upward trend continuation can be expected.

In conclusion, we think market will be bullish as the pair heads to test the 1.3850 resistance. A break above that level will open the door for additional near-term profits. And the next resistance is at 1.3878. On top of that, UK Services PMI will be released on Friday, which is a leading indicator of UK overall economic performance.

Resistance: 1.3850, 1.3878

Support: 1.3731, 1.3680, 1.3602

USDCAD (4- Hour Chart)

The USD/CAD pair tumbled on Thursday, touching the lowest level since August 16 during American session. The pair is trading at 1.2557 at the time of writing, posting a 0.49% loss on a daily basis. The surging oil prices and a weaker US dollar across the board both weighed on the USD/CAD pair, as it surrounded by heavy selling pressure. For technical aspect, RSI indicator 37 figures as of writing, suggesting bear-movement ahead. If we take a look at MACD indicator, a death cross should be taken as a selling signal.

In conclusion, we think market will be bearish as the pair failed to break the 1.2654 resistance, now heading to test the 1.2533 support. For the Bollinger Bands, the price is now at the outside of the lower band so a strong downward trend continuation can be expected. But if the price starts to move back inside the band, investors should pay attention to trend reversal. In addition to that, the risk flows keep pushing oil prices higher, therefore benefits the commodity-linked loonie.

Resistance: 1.2654, 1.2708

Support: 1.2533, 1.2502, 1.2453

AUDUSD (4- Hour Chart)

The AUD/USD pair was trading higher on Thursday and pushed higher during American session. AUD/USD gave a remarkable performance amid US dollar’s weakness and reached the highest level since August 5. The US economic data released today failed to support the greenback. At the time of writing, thr pair is trading at 0.7401, rising 0.50% on the day. For technical aspect, RSI indicator 75 figures as of writing, suggesting that the market is in overbought zone, which is an obvious selling signals for investors.

In conclusion, we think market will be bearish as long as the 0.7416 resistance line holds. For Bollinger Bands, the pair is now falling from the upper band after touching it, which indicates a bear market. Furthermore, Australia Retail Sales will be released on Friday, this is the foremost indicator of consumer spending.

Resistance: 0.7416, 0.7487

Support: 0.7356, 0.7303, 0.7222

Economic Data

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Daily Market Analysis

Market Focus

Megacap companies rallied to an all-time high as traders turned to defensive shares after the latest round of economic data suggested a slowdown in the labor-market recovery.

The NYSE FANG+ Index of pandemic darlings such as Apple Inc. and Amazon.com Inc. climbed about 1.5%. Tech, utilities and real-estate firms in the S&P 500 advanced, while energy and financial stocks fell. The benchmark gauge of American equities pared gains in afternoon trading, while still heading toward another record. The Dow Jones Industrial Average was little changed.

U.S. companies added fewer jobs than expected in August, ADP Research Institute data showed. While manufacturing expanded at a stronger-than-estimated pace, supply-chain bottlenecks were accompanied by labor constraints. Those figures came before Friday’s payrolls data, with economists expecting a deceleration from the rapid gain in the prior month and a drop in the unemployment rate.

Meantime, Citigroup Inc.’s Tobias Levkovich is sticking to his bearish call. The bank’s chief U.S. equity strategist predicts the index will end the year at 4,000 before reaching 4,350 by June 2022. Both levels sit below its last close of 4,522.68. Underpinning his view are stretched valuations and a planned tax rise that will hurt corporate profits.

Chinese stocks listed in the U.S. are gaining for a third consecutive day as investor sentiment begins to recover after a selloff fueled by Beijing’s sweeping regulatory crackdown.

Main Pairs Movement:

The Dollar greenback weakened amid downbeat ADP report, with the dollar index down 0.14% on Wednesday. The ADP private payrolls increased by 374,000 in August, missing expectation of 613,000 by large margin. Though ISM Manufacturing PMI came on top of expectation, printed 59.9 compared to forecasted 58.6, but employment figures remain to be the main focus for both Federal Reserve and market watchers. A big miss on Friday NFP report could significantly hamper Fed’s mood to initial taper in October, while a mild deviation from expectation could set the stage for stronger dollar in the fourth quarter.

Aussie was the best performer among its G-7 peers, gained 0.7% on the day. The pair is extending its rally towards 0.74, and conquered multiple resistance line along the way. The second quarter GDP (QoQ) was 0.7%, beating anticipated 0.5%. This upbeat data added to Aussie strength against the US dollar on Wednesday. However, the recent leg higher is a corrective move and we expect upward momentum to recede during next week.

Oil prices slipped after Russian oil minister Alexander Novak said Russian companies are ready to boost production beyond current levels, which was set by OPEC+. The Brent Futures was down 0.49%.

Technical Analysis:

CHFJPY (Daily Chart)

CHFJPY is approaching the lower part of a big ascending tunnel, and threatened for a breakout to the downside. Prices have been choppy in the past few sessions as a smaller descending trendline is capping further upward movements.

There was a obvious double-top pattern highlighted in blue, and price is now coming back to retest the neckline. We’ve seen strong rejection on Monday, which engulfed the entirety of previous candle, and signals upcoming bearish moves.

To the downside, bears will have to settle a solid close beneath the ascending trendline in order to attract more sell volume. A horizontal support of 119.2 is not far from the pivotal point near 119.7. Further in the south, 50% Fibonacci of 118 handle could provide some support.

Resistance: 120.55, 122.8

Support: 119.2, 118, 116.9

EURUSD (Daily Chart)

Euro dollar has recovered most of losses in July. However this pair failed to overcome a downward trendline on Wednesday as selling bias remains robust for the sharerd currency.

Price traveled from the bottom of Bollinger Band all-the-way to the upper bound within few days, and there was not much frictions. We suspect the latest rally to be bears’ profit-taking, rather than a reversal. That being said, we could at least see move lower toward 23.6% Fibonacci of 1.18 in the next day or so.

Investors should be prudent to wait for Friday’s Non-Farm Payroll release to determine a much clear direction. On the upside, modest resistance sits around 1.19, next to 1.196. Conversely, bulls’ defense line would be around 1.18 and 1.166.

Resistance: 1.19, 1.196, 1.2

Support: 1.18, 1.166

XAUUSD (Daily Chart)

The picture for Gold was little changed as market participants are eyeing for Friday NFP report for fresh trading incentives. Price has overcame DMA20, and retraced to validate the breakout was solid. Yesterday’s attempt to break below $1800 was defended by 50% Fibonacci of $1804.

Looking at a broader picture, the precious metal previously underwent a double-top pattern. Price took a dive straight to $1690 after the neckline of the double-top was defeated. Normally, if price comes back to retest the neckline, it will meet abundant pressure around this level.

The fact that current trade pattern failed to fulfill this thesis suggests short positions have been overwhelmed by longs. Therefore, we do not expect to see a significant pullback in the near term. That being said, price looks to advance further into 61.8% Fibonacci resistance around $1830.

Resistance: 1830, 1863, 1917

Support: 1804, 1777, 1744

Economic Data