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NZDUSD is shifting out of a neutral phase and the bias is tilted to the upside. The 4-hour chart analysis shows that the market was consolidating near 0.7055 and then rallied towards the 50-period moving average where momentum stalled. But there is room for more upside since the RSI indicator is in bullish territory.

A valid breakout above 0.7120 could propel prices towards the key 0.7200 psychological level. Further strength in the market would change the September 20 to October 10 bearish trend and shift the focus back to the upside towards important highs at 0.7243 and 0.7343 ahead of the September 20 peak at 0.7434. Rising above this would open the way for an extension to the July peak at 0.7557.

Alternatively, prices could remain capped below the 50-period MA to target the low at 0.7055. A move below this would see a resumption of the recent downtrend with scope to target the major low at 0.6817.

Near-term risk remains to the upside and the recent downtrend is expected to take a pause above 0.7055. But only a move above 0.7200 would indicate the end to the September-October downtrend. The negative alignment of the 20 and 50-period moving averages are keeping the bearish picture in play.

Price extends the latest gains and looks determined to breakout from the minor descending pitchfork. I've said in the previous reports that price should reach the upper median line (uml) of the descending pitchfork after the failure to reach the median line (ml). A valid breakout above the WL5 and above the upper median line (uml) will validate an increase at least till will reach the 1.1621 previous high.

Brent Oil increased little today and tries to stay above the broken 250% Fibonacci line (descending dotted line). I’ve said in the previous reports that the price could come to retest the median line (ML) of the major ascending pitchfork before will drop again. We’ll see what will happen when will hit the ML and also the 57.72, a rejection will send the rate at least till the 61.85 retracement level and towards the 53.03 horizontal support.

The currency pair has decreased today and has resumed the bearish movement as the USDX has touched fresh new lows. The Loonie has dragged the rate down, but remains to see what will happen and how will react after the Canadian and the US data will be sent to the public. We may have some volatility in the afternoon, so you should be careful not to ruin your account.

USD/CAD has squeezed a little in the last hours and waits for the US data to shake the markets again. The US PPI is expected to increase by 0.4% in September, beating the 0.2% growth in the former reading period, while the Unemployment Claims could decrease again, from 260K to 251K in the previous week. The Core PPI may increase as well by 0.2%, more versus the 0.1% in the former reading period.

The price had reached and retested the median line (ml) of the minor ascending pitchfork and now is pressuring the 1.2460 broken static support. I’ve said in the previous reports that the rate could come down to retest the median line (ml) and the 1.2460 static support, now we’ll have to see what will happen because a rejection will send the rate towards the median line (ML) of the major descending pitchfork and towards the 1.2678 static resistance.

However, we have to wait to escape again from the minor descending pitchfork’s body to be sure that will start a larger increase.

Bitcoin Back above 5K
FOMC Minutes restore confidence
Madrid Issues Ultimatum to Barcelona

Bitcoin made another record high and broke its previous record high of $5000. It is up nearly 74% from its previous low of $2975 and up today nearly 5.57% (at the time of writing this article). There are many things which are behind the move such as Amazon thinking of adding Bitcoin as a form of payment, Goldman Sachs exploring the idea of adding bitcoin desk and geopolitical tensions.

Traders are optimistic on the back of the FOMC minutes as it was confirmed that the Fed is committed to its current stance towards its monetary policy. As long as the economic outlook doesn't deteriorate, the Fed is confident that another rate is likely by the end of this year. The minutes stirred confidence for investors. The reason is that the Fed isn't concerned about the harmful effects of all the hurricanes and classified them as transitory. For the equity investors, an increase in the interest rate on the back of the stable economic outlook warrants them to continue to invest in riskier assets.

In simple terms, the recent economic outlook hasn't changed the Fed's stance towards the monetary policy and the FOMC minutes did provide the same message that the market was expecting. However, this isn't to say that there is a perfect harmony amid the Fed members, because some of them are little concerned about the inflation equation. Charles Evan, the Chicago Fed, and Minneapolis Fed, Neil Khaskari's, both think that inflation is too soft and hold a contrasting view to the other members. This confirms that the pace of the interest rate hike going into 2018 may not be the same. This has taken the wind out of the dollar index. Basically, the Fed's inflation target still appears to be out of reach. Moreover, the ongoing sparring between President Trump and Senate Republican Bob Corker about the tax overhaul is maintaining the resistance on the dollar index.

The Spanish government's response to Catalonian President's action was a little tougher than anticipated. Perhaps his agenda is to make sure that Catalonians understands very well that Madrid has the ultimate power and they aren't going to leave the country. The Spanish Prime Minister Mr. Rajoy demands a clear answer from the Catalonian leader on declaring a deferred independence. Catalonians have five days to respond and if they do confirm that the independence has been declared and it is implemented, then we should prepare for a dire situation in the market. Triggering the article 155 of the Spanish constitution would bring nuclear waves in the Spanish political system. This would be a no-win position for both parties.

Investors would be focused on the US banks mainly as Wall Street giants report their earnings. JP Morgan and Citigroup will report their earnings before the New York open and the consensus in the market is for a soft number from them. The main focus would be on the trading volume and their loan growth. Any deterioration in their credit quality would be unwelcomed by investors and their stock price could come under pressure.

WTI Oil trades lower on Thursday as strong rally in past three days showed signs of stall after hitting high at $51.40 (Fibo 61.8% of $52.84/$49.09 downleg).

The price came under pressure after release of API report which showed unexpected rise in crude stocks which rose by 3.1 million barrels and disappointed expectations for 0.4 million barrels draw.

Focus turns towards today's EIA crude stocks report which shows forecast for 1.9 million barrels draw.

Today's release in negative numbers could be supportive for oil price and prevent further fall.

Oil rallied strongly in past few days when WTI contract rose by 3.6% in three days on strong signals that oil market is rebalancing after being depressed by global oversupply.

Oil faces initial support at $50.72 (20 SMA) which contained yesterday's dips and now acting as first pivot.

Daily Tenkan-sen ($50.39) marks next important support, close below which would generate stronger bearish signal on completion of reversal pattern on daily chart for retest of next pivot at psychological $50.00 support.

Alternatively, fresh strength and close above $51.40 would signal continuation of bull-leg from $49.09 towards $51.96 (Fibo 76.4%) and expose recent peak at $52.74.

Res: 51.11, 51.40, 51.96, 52.41
Sup: 50.72, 50.52, 50.39, 50.00

Oil-exporters' cartel OPEC has released its outlook for crude to trade at US$55 per barrel in 2018, about 4% higher than its current ‘reference basket' price. We are not so sure. While bullish on petroleum production, we think that prices might be held in check by OPEC itself, which will not want to risk raising prices too far or too fast.

OPEC foresees the world economy growing at 3.6% next year, up from a previous estimate of 3.5%. Demand for crude, now at 32.8 million barrels a day, is expected to climb to 33.1 million barrels. Still, current prices are below the cost curve of most US shale-oil producers, and OPEC has every interest in keeping them there to keep their competing supplies in the ground.

Will EUR/CHF finally break the 1.20 threshold?

There is scant chance that the Euro will breach CHF 1.20 before the European Central Bank meeting on monetary policy of 14 December, but after that? A crawl-back to 1.20 – which the Swiss National Bank held as a floor until in early 2015 it let the franc float – could be on the cards. But it will take time.

Latest data are disappointing. Core inflation in the Eurozone eased to 1.1% annually in September, and broader inflation contracted during the summer, which will make the ECB wary of tightening money. We believe that the ECB will stay very cautious, taking only limited measures to boost the Euro. Economic growth has returned to the Eurozone, but further rises in the Euro's value are still on the horizon.

Crude oil is consolidating within a range defined by the support at 50.43 and the hourly resistance at 51.23. Key support is given at 45.40 (17/08/2017 high). Strong resistance lies at 52.86 (28/09/2017). Expected to show continued weakness.

In the long-term, crude oil has recovered after its sharp decline last year. However, we consider that further weakness are very likely. For the time being the pair lies in an upside momentum. Strong support lies at 35.24 (05/04/2016) while resistance can now be found at 55.24 (03/01/2017 high).

Silver has further improved as can be seen by the move above the resistance at $17.25. The precious metal is now trading above $17. Hourly support can be found at 16.13 (06/10/2017 low). Expected to show further increase.

In the long-term, the trend is rater negative. Further downsides are very likely. Resistance is located at 25.11 (28/08/2013 high). Strong support can be found at 11.75 (20/04/2009).

Gold has broken downtrend channel precious metal that drove the precious metal from 1357 to hourly support given at 1267 (15/08/2017 low). Strong support lies at a distance at 1204 (10/07/2017 high). Expected to show further upside move.

In the long-term, the technical structure suggests that there is a growing upside momentum. A break of 1392 (17/03/2014) is necessary ton confirm it, A major support can be found at 1045 (05/02/2010 low).