Sample Category Title

Daily Pivots: (S1) 1.3037; (P) 1.3085; (R1) 1.3142; More...

Intraday bias in GBP/USD remains neutral at this point. Further rise is in favor with 1.3002 minor support intact. Above 1.3131 will target a test on 1.3297 resistance. For now, we'd expect strong resistance from 1.3316 key fibonacci level to limit upside to bring down trend resumption. On the downside, below 1.3002 minor support will turn bias back to the downside for 1.2921 first.

In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4062). The structure and momentum of the fall from 1.4376 argues that it's resuming long term down trend. And this will be the preferred case as long as 38.2% retracement of 1.4376 to 1.2661 at 1.3316 holds. However, firm break of 1.3316 would bring stronger rebound to 61.8% retracement at 1.3721. And, the eventual depth of the fall from 1.4376, and the chance of hitting 1.1946 low, will depend on the strength of the interim corrective rebound from 1.2661.

Market movers today

Focus in the markets continues to be on Italy, where bond yields keep surging higher. Developments in the US bond market and the jump in US yields recently are still a theme also. Another key focus in financial markets are renewed signs of testy relations between China and the US.

On the data front, it will be an uneventful day. The US is due to publish the NFIB small business sentiment index, which as many other business surveys is at a very high level.

n Sweden, with focus being on the inflation numbers on Thursday, we will get a couple of interesting speeches from the Riksbank governors; Skingsley (09:00 CEST), Ingves (15:45) and Ohlsson (18:00). For more details, see page 2.

In Norway, the monthly GDP is due to be being released, see page 2.

Selected market news

Asian markets followed US stock markets lower overnight, dragged down by tech companies but also signals of deteriorating diplomatic relations between China and the US following US Secretary of State Michael Pompeo's visit to China, where the state secretary received a public rebuke from China's foreign minister. The purpose of the visit was to decide on a date for a future summit between Donald Trump and Kim Jong-un, which now seems uncertain. In another sign of the strained relations between the two countries, according to Bloomberg news, the US treasury department is contemplating whether to name China as a currency manipulator in a report due out next week following the yuan's sharp depreciation recently.

Overnight, the IMF published its new assessment of the global economy, where it cut its estimate of world economic growth forecasts slightly for both 2018 and 2019 . The IMF now sees global growth at 3.7% in both years, down from 3.9% in April. The main reason is the recent tariff dispute between the US and China and other trade tensions globally. The IMF downgraded as a result in both China and the US. However, the institution also sees signs of slower growth in key emerging markets such as Latin America (Argentina, Brazil, and Mexico), emerging Europe (Turkey), south Asia (India), east Asia (Indonesia and Malaysia), the Middle East (Iran) and Africa (South Africa).

Meanwhile, tensions continue in Europe over Italy's budget projections. Yesterday, League Leader Salvini signalled no willingness to back down from the government's expansionary fiscal stance, saying that speculators are 'wasting time and wasting money because we will not go back'. We think the uncompromising stances from both the EU and the Italian government mean that market sentiment could get worse before it gets better. See our reaction to the Italian budget on Friday here: Italian Politics Monitor - The (budget) genie is out of the bottle.

Daily Pivots: (S1) 0.9906; (P) 0.9926; (R1) 0.9944; More...

No change in USD/CHF's outlook. Consolidation from 0.9954 temporary top is in progress and intraday bias stays neutral first. Another fall cannot be ruled out. But downside should be contained by 38.2% retracement of 0.9541 to 0.9954 at 0.9796 to bring rise resumption. On the upside, break of 0.9954 will target 1.0067 resistance next.

In the bigger picture, the pullback from 1.0067 has completed at 0.9541 already. And rise from 0.9186 is likely resuming. Firm break of 1.0067 will pave the way to retest 1.0342 key resistance. We'd be cautious on strong resistance from there to limit upside to bring another medium term fall to extend long term range trading.

Daily Pivots: (S1) 112.72; (P) 113.33; (R1) 113.86; More...

Intraday bias in USD/JPY remains on the downside as this point as correction fall from 114.54 might extend. Sustained trading below 38.2% retracement of 110.37 to 114.54 at 112.94 will target 61.8% retracement at 111.96. On the upside, above 113.55 minor resistance will bring retest on 114.54 and 114.73 key resistance first.

In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.76 support holds.

Daily Pivots: (S1) 1.2927; (P) 1.2970; (R1) 1.3001; More...

Even though USD/CAD's rebound from 1.2781 was strong, it's limited well below 1.3081 resistance. Such rebound is still seen as a correction and larger fall from 1.3385 is in progress. On the downside, below 1.2886 minor support will turn bias to the downside for 1.2781 first. Break of 1.2781 will extend whole decline from 1.3385 to next fibonacci level at 1.2567, which is close to 1.2526 support. However, break of 1.3081 will turn outlook bullish for 1.3225 resistance.

In the bigger picture, corrective rebound from 1.2061 could have completed at 1.3385 already. Deeper fall is mildly in favor to 61.8% retracement of 1.2061 to 1.3385 at 1.2567, which is close to 1.2526 support. For now, we're not seeing fall from 1.3385 as resuming larger down trend from 1.4689 (2015 high) yet. Thus, we'll look for bottoming signal again below 1.2567 . On the upside, though, break of 1.3081 resistance will argue that the pull back from 1.3385 is completed and rise from 1.2061 is resuming for another high above 1.3385.

For the 24 hours to 23:00 GMT, the EUR declined 0.22% against the USD and closed at 1.1492, amid looming concerns over Italy's budget deficit.

On the data front, Euro-zone's Sentix investor confidence index dropped to a level of 11.4 in October, amid uncertainties over Italy's policy stance and more than market consensus for a fall to a level of 11.6. In the prior month, the index had registered a reading of 12.0.

Additionally, in Germany, seasonally adjusted industrial production unexpectedly eased 0.3% on a monthly basis in August, falling for the third consecutive month, driven by losses in the construction sector. In the previous month, industrial production had declined 1.1%, while market participants had envisaged to record a gain of 0.3%.

In the Asian session, at GMT0300, the pair is trading at 1.1493, with the EUR trading marginally higher against the USD from yesterday's close.

The pair is expected to find support at 1.1462, and a fall through could take it to the next support level of 1.1431. The pair is expected to find its first resistance at 1.1522, and a rise through could take it to the next resistance level of 1.1551.

Looking ahead, traders would await Germany's trade balance data for August set to release in a while. Additionally, the US NFIB small business optimism index for September, scheduled to release later in the day, will pique significant amount of investor attention.

The currency pair is trading between its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the GBP declined 0.21% against the USD and closed at 1.3093.

Macroeconomic news indicated that UK's BRC like-for-like retail sales across all sectors unexpectedly dropped 0.2% on a yearly basis in September, defying market consensus for an advance of 0.1%. Retail sales across all sectors had recorded a rise of 0.2% in the previous month.

In the Asian session, at GMT0300, the pair is trading at 1.3094, with the GBP trading marginally higher against the USD from yesterday's close.

The pair is expected to find support at 1.3041, and a fall through could take it to the next support level of 1.2988. The pair is expected to find its first resistance at 1.3134, and a rise through could take it to the next resistance level of 1.3174.

Amid lack of economic releases in the UK today, traders would focus on global macroeconomic events for further direction.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD declined 0.66% against the JPY and closed at 113.10.

In the Asian session, at GMT0300, the pair is trading at 113.13, with the USD trading slightly higher against the JPY from yesterday's close.

Overnight data showed that Japan's (BOP basis) trade deficit widened more than expected to ¥219.3 billion in August, compared to a deficit of ¥1.0 billion in the prior month. Markets participants had anticipated the nation's trade deficit to expand to ¥208.0 billion.

The pair is expected to find support at 112.67, and a fall through could take it to the next support level of 112.21. The pair is expected to find its first resistance at 113.74, and a rise through could take it to the next resistance level of 114.35.

Looking forward, investors would focus on Japan's machinery orders for August, slated to release overnight.

The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD slightly rose against the CHF and closed at 0.9925.

In the economic news, Switzerland's seasonally adjusted unemployment rate slid to 2.5% in September, in line with market expectations and following a reading of 2.6% in the prior month. Meanwhile, the nation's total sight deposits eased to a level of CHF577.5 billion in the week ended 05 October, from CHF577.9 billion in the previous week.

In the Asian session, at GMT0300, the pair is trading at 0.9926, with the USD trading a tad higher against the CHF from yesterday's close.

The pair is expected to find support at 0.9908, and a fall through could take it to the next support level of 0.9889. The pair is expected to find its first resistance at 0.9945, and a rise through could take it to the next resistance level of 0.9963.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD marginally rose against the CAD and closed at 1.2955.

In the Asian session, at GMT0300, the pair is trading at 1.2961, with the USD trading 0.05% higher against the CAD from yesterday’s close.

The pair is expected to find support at 1.2938, and a fall through could take it to the next support level of 1.2915. The pair is expected to find its first resistance at 1.2997, and a rise through could take it to the next resistance level of 1.3033.

Moving ahead, investors would closely monitor Canada’s housing starts data for September, due to be released later in the day.

The currency pair is trading below its 20 Hr moving average and showing convergence with its 50 Hr moving average.