Wakeup Call: Asset Purchase Program Extended To March

Fed extended the asset purchase program deadline to March, but nevertheless stated that the economy has picked up.

Calendar

Economic Data Releases
Country	Name	Time (GMT)	Expectation	Prior	Comment
GE	08:00	IFO Busi. Climate / Expectations (SEP)	92.0 / 96.6	90.5 / 95.0
US	12:30	Initial / Continuing Jobless Claims	550K / 6183K	545K / 6230K
US	14:00	Existing Home Sales (AUG)	5.35M	5.24M

What's going on?

Mixed signals from central banks: The Federal Reserve will keep interest rates low for another period and also extended the asset purchase program to March, while Canada and Norway is signaling that they are ready to hike; stocks will be supported by the Fed's statement, but once other central banks start to signal hiking interest rates stocks will be under pressure.

Initial Jobless Claims surprised to the upside last week due to Labor Day. Watch out for a worse than expected number today as those first time claimants who missed out will make sure that they get benefits this time.

Hennes & Mauritz reported Q3 results earlier today. Net income rose to SEK 3.46B (3.33B), which was slightly below the SEK 3.5B estimate

FX

FX	Daily stance	Comment
EURUSD	0/-	If we hold below 1.4750-60, expect a deeper retracement below 1.46. Abv sees 1.4825.
USDJPY	0/+	Expect suppt at 90.50 to hold for a bounce back to 91.50-65 levels.
EURJPY	0/-	Expect slow drift down to 133.0, poss 132.50 now 134.0 has broken.
GBPUSD	0/-	Still look to sell rallies to 1.64 for a push back to 1.63, poss 1.6250. stop abv 1.6455.
AUDUSD	0/-	Expect res at 0.8730 to contain current rally for re-test of 0.8650 lvls. Abv sees 0.88 again.

Equities

Equities	Daily stance	Comment
DAX	0/+	Buy at the break of 5645 and target 5692. Stop below 5626.
FTSE	0/+	Buy at the break of 5091 and target 5130. Stop below 5075.
S&P500	0/+	Buy at the break of 1060 and target 1070. Stop below 1056.
Nasdaq100
Dow Jones

Futures

Commodities	Daily Stance	Comment
Gold	0	Lack of follow-through on upside. Expect to trade 1,005-1,015 today.
Silver	0/-	Dollar rebound expected to cap silver at 16.95 lvl. Next suppt 16.55-60.
Oil	0/-	High inventories pressuring downside. Suppt at 68.0 then 66.50.

FX Options

FX- Options	Comment
EURUSD	Large US investment bank paid for 6 day 1.46 in good size, however there were plenty of sellers there as well. Talk of barriers up to 1.50. Do not expect spot to break out soon.
USDJPY	Front end continues lower even as spot makes new session lows. Downside shortdate 90.50-90.00 strikes finds a few buyers but risk reversals down the middle are weak.
AUDUSD	1 mth got given early on at 13.85% and rest of the front end sellers soon came along. Spot seems unable to push above 8730 but even if it does, it will be a slow grind higher.

Saxo Bank

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