Sample Category Title

Pivot (invalidation): 110.70

Our preference Long positions above 110.70 with targets at 111.20 & 111.40 in extension.

Alternative scenario Below 110.70 look for further downside with 110.50 & 110.35 as targets.

Comment Technically the RSI is above its neutrality area at 50.

Pivot (invalidation): 1.2960

Our preference Short positions below 1.2960 with targets at 1.2895 & 1.2870 in extension.

Alternative scenario Above 1.2960 look for further upside with 1.2990 & 1.3030 as targets.

Comment As Long as the resistance at 1.2960 is not surpassed, the risk of the break below 1.2895 remains high.

Pivot (invalidation): 1.1585

Our preference Short positions below 1.1585 with targets at 1.1530 & 1.1500 in extension.

Alternative scenario Above 1.1585 look for further upside with 1.1615 & 1.1650 as targets.

Comment The RSI is bearish and calls for further decline.

The Euro stands at the back foot in early Monday's trading and hit new three-week low at 1.1526, maintaining negative tone for further weakness. Strong bearish signals on last Friday's close below pivotal supports at 1.1568 (30SMA / Fibo 38.2% of 1.1300/1.1733 upleg) and 1.1562 (base of thick weekly cloud) add to increasing bearish pressure. Also, Friday's long red daily candle weighs, along with 14-d momentum breaking into negative territory and slow stochastic heading south after forming bear-cross. Bears pressure initial support at 1.1517 (50% of 1.1300/1.1733 / daily Kijun-sen), with weekly 100SMA (1.1483) and Fibo 61.8% (1.1466), coming in focus. Strong US August jobs data, released on Friday and persisting fears about escalation in the US – China trade conflict, keep the greenback supported. Corrective upticks would be seen as positioning for fresh weakness, with broken 55SMA (1.1612) expected to cap. ECB's policy meeting on Thursday is key event for the Euro this week and traders expected to get some stronger signals, despite the central bank's stance of keeping rates unchanged until mid-2019 and QE program at least until the end of this year.

Res: 1.1568, 1.1600, 1.1626, 1.1649
Sup: 1.1517, 1.1483, 1.1466, 1.1400

Rates: Trade conflict to reappear on market radar?

US payrolls, and more specifically wage growth, inflicted significant losses on US Treasuries on Friday. The US 2-yr yield hit a new cycle high. Hawkish trade rhetoric by US President Trump is weighing on Asian stock markets overnight, but other risk barometers are more neutral. Trade could retake its role as market driver in absence of other data/events today.

Currencies: EUR/USD nears intermediate support.

On Friday, the dollar succeeded modest gains after solid US wage growth. This week, trade tensions might dominate USD trading at the start of the week. US eco data might become more important later. For now, the dollar might regain the benefit of the doubt. EUR/USD breaking below 1.1540/30 might inspire some further USD gains short-term.

The Sunrise Headlines

• US equity markets lost ground on Friday, ending last week's trading week with limited losses. Asian markets open the new week with (bigger) losses, with China underperforming. Only Japan remains marginally in the green.
• US President Trump has said that he is ready to impose tariffs on an additional $267bn on Chinese import on short notice, additional to the previously proposed $200bn that the US government is putting the final touches on.
• After Sweden's elections, the country is in a political gridlock. Nor left-centred Social Democrats nor the right-centred Alliance bloc is able to form majority governments. The populist Sweden Democrats are Sweden's 3rd biggest party.
• After an informal summit in Salzburg this month (20th of September) between the EU's 27 leaders, the EU wants to give its Brexit negotiator Michel Barnier additional guidance and a mandate to close a brexit deal.
• Canada's foreign minister Freeland left Washington on Friday for a two week break in Nafta-negotiations. No signs of a new Nafta-deal were detected, while US President Trump threatens to impose 25% tariffs on Canadian cars.
• US Congressional leaders are expected to secure a deal today on a package of three spending bills for the upcoming fiscal year. This deal would avoid the partial government shutdown, threatened by US President Trump.
• Today's US eco calendar is empty, with only Fed's Bostic to speak. UK industrial production figures and monthly GDP data will be released. The EU and the US resume talks over July Trump-Juncker agreement in Brussels.

Currencies: EUR/USD Nears Intermediate Support

USD retains benefit of the doubt post payrolls

On Friday, global trading developed in a typically quiet manner going into the publication of the US payrolls. Net job growth was solid (201k vs 190k expected), but June/July figures were downwardly revised. The unemployment rate stabilized at 3.9% but average hourly earnings unexpectedly accelerated 0.4% M/M and 2.9% Y/Y. US yields and the dollar turned north as markets saw a rising probability of two additional Fed hikes this year. Initially, the USD reacted cautiously but USD gains were extended later. EUR/USD closed the day at 1.1553 (from 1.1623). USD/JPY reversed an earlier dip, but closed the session in well-known territory near the 111 level. This morning, post-payrolls USD strength is keeping (some) EM currencies in the defensive, but overal the losses are rather benign. Japan Q2 growth was upwardly revised to a 3.0% Q/Qa. As usual, the yen hardly reacts to Japanese data. USD/JPY is holding near 111. EUR/USD is changing hands near 1.1550. Later today, there are few eco data in the US and in Europe. Trade issues will probably continue to take centre stage. The US and the EU resume talks. President Trump might still announce additional tariffs on Chinese imports, especially as the China-US trade surplus reached a record in August. Trade talks with Canada also didn't yield a result yet. The eco calendar is back loaded with the US CPI and ECB policy meeting on Thursday and the US retail sales on Friday. Last week, the dollar gained a few ticks against the euro but didn't break any key resistance. The combination of global uncertainty on trade, lingering EM stress and ongoing solid US eco data, should be a USD-constructive context. We continue to give the dollar the benefit of the doubt short-term, especially against the euro. That said, last week's price action indicated that a similar context was no guarantee for spectacular USD gains. The EUR/USD 1.1530/40 is a minor EUR/USD support within the established range. A break below might inspire some further USD gains short-term.

Last week, markets saw some tentative signs that the EU and the UK might come closer to a brexit deal, pushing EUR/GBP back below the 0.90 handle. Today, the UK July production data will be pubublished. Still, brexit headlines will probably dominate GBP trading. Last week's price action suggests the market was still positioned GBP-short, temporarily supporting sterling. However, fundamentally, we see no reason for a sustained GBP comeback without ‘real' brexit progress.

EUR/USD nears intermediate support in 1.1530/40 area.

Daily Pivots: (S1) 142.58; (P) 143.49; (R1) 144.38; More...

Intraday bias in GBP/JPY remains neutral at this point. On the upside, break of 145.67 will target 38.2% retracement of 156.59 to 139.88 at 146.26. Decisive break there will be a strong signal that fall from 156.59 has completed at 139.88, ahead of 139.29/47 key support zone. Further rally should then be seen to 149.30 resistance for confirmation. On the downside, though, break of 142.58 will turn bias back to the downside for retesting 139.88 low instead.

In the bigger picture, at this point decline from 156.59 is still seen as a corrective move. Focus remains on 139.29 cluster support (50% retracement of 122.36 to 156.59 at 139.47). Strong rebound from there will re-affirm the bullish case that rise from 122.36 is still to extend through 156.59 high. However, sustained break of 139.29/47 should confirm medium term reversal. GBP/JPY would then target a retest on 122.26 (2016 low).

Daily Pivots: (S1) 127.88; (P) 128.49; (R1) 128.96; More....

Intraday bias in EUR/JPY remains on the downside for 61.8% retracement of 124.89 to 130.86 at 127.17. The rebound from 124.89 might be completed at 130.86 already. Break of 127.17 will target a test on key support zone at 124.61/89. On the upside, though, break of 129.97 resistance will likely resume the rebound from 124.89 through 130.86.

In the bigger picture, as long as 124.08 key resistance turned support, larger up trend from 109.03 (2016 low) remains in favor to continue. Decisive break of 61.8% retracement of 137.49 to 124.61 at 132.56 will pave the way to retest 137.49 high. However, firm break of 124.08 will argue that whole rise from 109.03 (2016 low) has completed at 137.49. Deeper decline would be seen to 61.8% retracement of 109.03 to 137.49 at 119.90 next.

The euro is coming under selling pressure against the US dollar on Monday, after a stronger than expected US jobs figure and bearish weekly price close below the 1.1553 level. Sellers attention is once again focused on the head and shoulders pattern neckline around the 1.1530 level. Buyers will need to move price above the 1.1600 level to negate the short-term bearish sentiment surrounding the EURUSD pair.

The EURUSD pair is bearish while trading below the 1.1553 level, key technical support is found at the 1.1530 and 1.1500 levels.

If the EURUSD pair moves above the 1.1600 level, buyers are likely to test towards the 1.1650 and 1.1681 levels.

The British pound is back under pressure towards the 1.2900 level against the greenback after a stronger than expected US jobs figure provoked US dollar buying. The bearish head and shoulder pattern is still valid across the lower time frames, despite Friday’s brief spike above the 1.3000 level. Sterling traders now look to the release of GDP, Manufacturing and Industrial production data from the United Kingdom economy.

The GBPUSD pair is bearish while trading below the 1.2900 level, key support is found at the 1.2863 and 1.2802 levels.

If the GBPUSD pair moves above the 1.2900 level, key technical resistance is found at the 1.2955 and 1.2985 levels.

A decline in the crypto market continued today led by a major drop in the price of Ethereum. The total market capitalization of cryptocurrencies tracked by CoinMarketCap declined to $196 billion, which is $640 billion lower than the peak in January this year.

The ETH/USD and BTC/USD pairs are trading at 189 and 6222 respectively. The former is the lowest it has fallen since October last year while the latter is the lowest it has been since August this year.

The declines this week were triggered by the SEC’s decision to suspend the trading of two crypto related securities, Bitcoin Tracker One and Ether Tracker One, citing investor confusion. This was a blow to the cryptocurrencies market which has seen more bad news in recent months.

Today’s decline also came after the founder of Ethereum issued a rare warning to traders. In a statement on Friday, Vitalik Buterin said that the era of huge returns in the cryptocurrency was gone.

The decline ignored the positive news coming from Citigroup. On Friday, the bank said that it had developed a new mechanism for crypto trading. This was welcome news following reports that Goldman Sachs was suspending its creation of a crypto trading floor.

ETH/USD fell to an intraday low of 181.13. This was a sharp decline from the previous range the pair has been trading as shown below. While the RSI is trading at an extremely oversold level, the pair could continue the decline as the sell-off continues.