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AUD/JPY is once again the top mover today. But unlike yesterday, it's now the biggest gainer. The high volatility in AUD/JPY is a clear reflection of what's happening in the stock markets. Though, we'd like to point out that DOW is so far up just 0.62% for now. DOW it as high as 24657.18 and couldn't even touch the lowest side of the gap made yesterday. Thus, rebound in the US stocks is not too convincing yet.

Coming back to AUD/JPY, it defended the mentioned key near term support of 81.24 as mentioned yesterday, with just a brief breach to 81.19. It also holds above 55 day EMA. Hence there is no confirmation of rejection by 38.2% retracement of 90.29 to 78.65 at 83.02 yet. Intraday bias stays neutral first.

Whether we can still call that a double bottom (78.67, 78.56) is not that important now. In any case, sustained break of 83.02 will indicate medium term reversal. And, further rally could be seen to 61.8% retracement of 90.29 to 78.65 at 85.79. Meanwhile, firm break of 81.24 confirm the rejection by 83.02 fibonacci level. Also, that would mark rejection by 55 week EMA. And, medium term bearishness would be retained and retest of 78.56 low should be seen next.

GBP/USD has posted small gains in the Wednesday session. In North American trade, the pair is trading at 1.2777, down 0.07% on the day. On the release front, the U.K deficit ballooned to GBP 8.0 billion, well above the estimate of the GBP 5.6 billion. In the U.S, key indicators were soft.Core durable goods orders remained pegged at 0.1%, shy of the estimate of 0.4%. Durable goods orders were dismal, with a sharp decline of 4.4%, compared to the estimate of -2.2%. This was the sharpest drop since August 2017. Unemployment claims jumped to 225 thousand, above the estimate of 214 thousand and a 4-month high. As well, UoM consumer confidence dipped to 97.5, short of the estimate of 98.4 points.

A sharp fall in technological stocks on Wednesday has sent global equity markets sharply lower. So far, investors have not snapped up U.S dollars at the expense of other currencies, such as the British pound. Much of the drop has been attributed to the festering U.S-China trade war, which shows no signs of easing. There had been hopes that the U.S might ease up on the rhetoric against China, but those hopes were dashed on Sunday, at an APEC summit in Papua New Guinea. The meeting ended in discord, with leaders unable to agree on a final communique. U.S. Vice President Mike Pence, who headed the U.S. delegation, was blunt in his remarks, saying that China would have to drastically change its trade practices before the U.S. would remove current tariffs on $250 billion in Chinese goods.

The latest turmoil surrounding the Brexit negotiations have unnerved the business sector, which is deeply alarmed at the uncertainty facing the British economy after the U.K. leaves the European Union. The U.K and the EU reached a tentative withdrawal agreement last week, but there are deep divisions within the Conservative party over the deal. With Labor smelling blood and vowing to vote down any agreement brought to parliament, pundits are wondering if any deal Prime Minister May tries to pass in parliament will be dead on arrival. If so, the nightmarish scenario of a no-deal departure could materialize, which would be disastrous for the British economy. On Monday, John Allen, president of the Confederation of British Industry, bluntly warned that a no-deal Brexit would be a “wrecking ball for the economy”. Prime Minister May is fighting for her political life, and the pound will likely remain under pressure, unless May can somehow push the Brexit agreement through a skeptical parliament.

GOLD is breaking higher after that short running flat pattern which is very rare, so at the same time we are also tracking a completed five-wave rise into wave »i« labeled as an alternate count. That said, we have to be careful at this stage, because it could be only a spike up before a deeper correction, but if GOLD remains above 1219 region and continues higher in an impulsive manner towards 1240 area, then we may consider a wave »iii« within uptrend! Anyhow, we expect Gold to rally either straight to the upside from current levels or after a deeper correction, as long as it's above 1196 invalidation level.

Gold, 1h

The US 100 stock index plunged to a 7-month low of 6439.25 yesterday as the bears continue to pull the price further below the index’s all-time high of 7701.35 set on October 1. Momentum indicators point to further weakness in the near term, with the stochastics falling towards oversold territory, while the RSI lies deep in the bearish zone. However, the RSI has ticked higher today, suggesting a moderation of the negative momentum.

Should the sell-off resume, the 123.6% Fibonacci extension of the upleg from 6572.25 to 7218.10 would be the nearest key support to watch around 6420. A drop below this level would reinforce the emerging bearish structure in the medium term. Further down, the 138.2% and 161.8% Fibonacci extensions at 6325 and 6173, respectively, would be the next hurdles that could stall steeper declines.

However, should today’s upside move gain traction, resistance could initially come at the 78.6% Fibonacci retracement level at 6710. Overcoming this barrier would clear the way for the 61.8% Fibonacci at 6818, followed by the 50% Fibonacci at 6895. A break above the 50% Fibonacci region around 6900, which also incorporates the 20-day moving average, would help ease the downside pressure and shift the near-term bias to a positive one.

Brent crude oil futures with delivery in January 2019 plummeted to an almost one-year low around 61.70 on Tuesday. The price is set to complete the seventh straight negative week, however, looking at the very-short term timeframe, it has jumped above the multi-month low today. The MACD oscillator is flattening below its trigger line, while the RSI is moving sideways in the bearish zone.

If the price continues the weak upside movement, it would challenge again the 64.60 resistance, before being able to re-touch the 20- and 40-simple moving averages (SMAs) near 65.54 and 66.14 respectively. A significant leg above these lines could push prices towards the 23.6% Fibonacci retracement level of the downleg from 86.71 to 61.70 around 67.63.

However, in case of a slide below 61.70, the next support would come from the 60.85 level, taken from the low on December 2017. Should prices decline further, the focus shifts to 59.50, identified by the inside peak on September 2017.

Overall, Brent seems to be strongly bearish over the last one-and-a-half months following the pullback on the 86.71 high.

Italy appears to be standing firm on 2019 draft budget plan even though European Commission has taken the first step of Excessive Deficit Procedure

Deputy Prime Minister Luigi Di Maio said in his facebook post that "Both us and Europe want the same thing: reduce debt. And the European Union will be convinced that, to achieve the goal, we have chosen the only road that works: helping families and businesses, creating new job opportunities for young people. That's how Italy finally can grow."

https://www.facebook.com/LuigiDiMaio/posts/1993227060713830?__xts__[0]=68.ARBgD3V6jDlDdF7Ew1Mm60mK9LOAxyzUe39kW0dHylSHvihzHs4zL3rKbYLN97ZB7QQTGiLUVo3sBKWJdLIIGACYzlMogtUjYyAOF1IKtMEuao37ztVpFVLlX_Q3robiQF0Mxe9ibAlSqZsRF_hOzTKt5t5FaCjtbE74Q3zPsR6JkLU0gEdBmWm5SMucc90wfxonGWFoERHVF-lbFJhUw7C-FkiczVRO6p25rG68YM4AHIrWyc85DySINmHY5F6eFbweL68UQWa5jSPXUxBXbwhAld-w53eFKyiEZM9gPHyAHRMHWmApIBYyaY1daYuTY2Xz6iXAhPNoMGB8JJp1EXFMx-SE3ZmsBFFk6a8OvAg8ltEizVW2shJ6NiTDFz_jS7K8qP7Yw6D9nkCQ25VMIvGzJWEGRmUIK3uA139OVryacQOXto6mePRANzjY8LXBwMG1q7BXT95r0m-bTtnip-vKiZ2g70LQbClr0GeE3hDtTAlQ6Q&__tn__=-R

Prime Minister Giuseppe Conte also said "I have been at work since day one, along with the whole government team, to make the country more competitive and realize the conditions for effective economic and social growth. Let us move forward, convinced that this is the best way to reduce debt with advantage for our country and also for Europe."

https://www.facebook.com/GiuseppeConte64/posts/515680745580562?__xts__[0]=68.ARAvJ4oyTcZnFkH_-od16bbsEOygEyrqkojtQAVxEM3MxS7OTsiu3g4QHvdl4kFPNss4JULBecfcMgah7HaZzjKDGFl4UvM3eob5-YsXBsRszcCqinoHMyRCo6F9Qzsrm5xRSyxUFz_VZAnSo0znRMYRWRwWIRCh-NgAeoDeToPrhQsKhTxeWnrqy8M-SKf2SqjLb5lg9ZKnkJ9D6SvlIEruIL8B5WINtvgCqwl2V7S_L0nbmJZSqHVbqcHWrJ8HsMMPEvNm3wqEAwpQRVgGo9gwHpJjBWJkl2E35OYWU_4v-LTo1gapm5HnIFjMRPzwKFNhgYc2vKY-SktF8LQ&__tn__=-R

UK Prime Minister Theresa May will meet European Commission President Jean-Claude Juncker today, with focus on the future relationship. Specifically, May seeks to complete a 20-page political blueprint document on future relationship with Juncker And hopefully, the blueprint could help May win back the support in the parliament on the Brexit withdrawal agrement.

May also told the parliament today that "we continue to negotiate on that future relationship to get the good deal that we believe is right for the United Kingdom."

While May could have survived the leadership challenge by the embarrassed Jacob Rees-Mogg, the chance of getting the Brexit deal through the parliament is still slim. Another breakthrough is deadly needed.

CADJPY is paring some of yesterday’s negative ground but remains slightly below the medium-term ascending trend line. Also, the price recorded a two-month low of 84.57 earlier today. From the technical point of view, the MACD oscillator suggests that the market could maintain the bearish movement near the zero line, however, the RSI indicator is moving higher below the 50 level.

Should the price head lower, traders could look for support around 83.72, which stands well below the rising trend line. Such a move would endorse the bearish structure and even lower, a break below this level would clearly challenge the 82.15 support.

On the other side, gains could try to overcome the 85.40 resistance and reach the 20-day simple moving average (SMA) around 85.90. If the market moves higher, the 40-day SMA could act as major resistance as well at 86.40. Further up, the attention would turn to the area around 87.00, a frequently approached zone on November 8.

In the bigger picture, CADJPY seems to be erasing the bullish view after the daily close below the eight-month diagonal line. However, today’s bullish movement could drive the price back above this hurdle, raising the prospect of false bearish signals.

The DAX index has steadied in the Wednesday session. Currently, the DAX is trading at 11,174, up 0.33% on the day. There are no German or eurozone indicators on the schedule. On Thursday, the ECB releases the minutes of its policy meeting in October and the eurozone publishes consumer confidence.

A sharp fall in technological stocks on Wednesday has sent global equity markets sharply lower. The DAX has dropped 1.8% this week, and there could be more bumps ahead, as nervous investors fret over the escalating trade war between the U.S. and China. There had been hopes that the U.S might ease up on the rhetoric against China, but those hopes were dashed on Sunday, at an Asian-Pacific summit in Papua New Guinea. The meeting ended in discord, with leaders unable to agree on a final communique. U.S Vice President Mike Pence, who headed the U.S. delegation, was blunt in his remarks, saying that China would have to drastically change its trade practices before the U.S. would remove current tariffs on $250 billion in Chinese goods.

The standoff between Rome and Brussels over the Italian budget continues, with the ball now in the court of the European Commission, which is in charge of EU regulations. The Commission is expected to issue a report on Wednesday that Italy’s draft 2019 budget is in breach of EU deficit and debt rules. Italy’s debt stands at a staggering 132% of GDP, and the EU is concerned that the high-spending budget could cause another debt crisis in the eurozone. The EU could impose severe financial sanctions on Italy, with fines of up to 0.2% of the country’s GDP. Senior Italian officials have vowed not to bend on the budget, but a compromise would clearly be in the interest of both sides.

The ECB remains on track to wind up its stimulus package at the end of the year, but the economic slowdown gripping the eurozone could mean a change in monetary policy. German data is often viewed as a bellwether for the eurozone, and a rare decline in German GDP in the third quarter is an alarm bell that the euorozone economy has hit some headwinds. On Tuesday, ABN-Amro, one of the largest banks in the Netherlands, said that it does not expect the ECB to raise interest rates before March 2020.