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The British pound has moved higher against the U.S dollar, hitting 1.3285, after the United Kingdom's Services PMI for the month of September beat market expectations, with a solid 53.6 reading.

Today's intraday trading sentiment surrounding the GBPUSD pair remains mixed, with the pair still bearish below the 1.3360 level, however, price-action has recovered above the daily pivot point, at 1.3249.

Sterling is likely to advance towards its monthly pivot point at 1.3321, if price-action can break-above the key 1.3290 technical resistance area.

Traders will likely wait for key jobs data from the U.S and FED Chair Janet Yellen's speech, before attempting to push price-action above the daily high.

Key intraday GBPUSD technical support is found at 1.3249 and 1.3220. Once below 1.3220, further weekly support is found at 1.3190 and 1.3149.

To the upside, key intraday technical resistance is found at 1.3290, 1.3321. Once above the 1.3321 level, further resistance is found at 1.3342 and 1.3361.

The USDJPY pair continues to edge lower, driven by weakness in the U.S dollar, with intraday sellers pushing price-action towards the lower end its the recent trading range, between 113.25 and 112.20.

Intraday trading sentiment surround the USDJPY is gradually turning bearish, with the pair earlier failing at 112.90 and also slipping below key daily support, at 112.70.

The USDJPY pair faces two key risk events later today, firstly, today's ADP jobs report may be substantially weaker than expected, due to adverse weather effects in the United States during the previous month.

Secondly, the market is starting to re-price a December rate hike from the Federal Reserve, if Janet Yellen fails to communicate this message again to financial markets today, it may lead to a U.S dollar sell-off.

Key intraday USDJPY support below the 112.20 level is located at 111.90 and 111.69. Further key support is found at 111.48, with the pairs monthly pivot point, at 111.03.

To the upside, key intraday USDJPY resistance is found at 112.70, 112.90 and 113.25. Once above the 113.25 level, further resistance is found at 113.57 and 113.89.

The British pound has posted slight gains on Wednesday, erasing the losses which marked the Tuesday session. Currently, GBP/USD is trading at 1.3281, up 0.33% on the day. On the release front, British Services PMI improved to 53.6, above the estimate of 53.2 points. In the US, there are two key indicators on the schedule. ADP Nonfarm Payrolls , the first of this week's job reports, is expected to slow to 131 thousand. The ISM Nonfarm Manufacturing PMI is forecast to edge up to 55.5 points. We'll also hear from Federal Reserve Chair Janet Yellen, who will deliver remarks at an event hosted by the St. Louis Fed. On Thursday, the US releases unemployment claims, which is expected to drop to 266 thousand.

British Services PMI managed to beat its estimate, but the construction and manufacturing PMIs both slowed down in September, raising questions about the health of the British economy ahead of the dark cloud of Brexit. Construction PMI was a huge disappointment, falling to 48.1 points. The reading pointed to contraction in the construction sector for the first time since August 2016, shortly after the Brexit vote. Manufacturing PMI slipped to 55.9 in September, down from 56.9 points a month earlier. Although this indicates expansion, the indicator missed expectations, and investors could become nervous and sell their pound assets. The soft PMIs could also affect the BoE's interest rate plans. The BoE has broadly hinted that it will raise rates in the near future, with low unemployment and high inflation the main arguments for raising rates. However, if economic indicators continue to point downwards, policymakers will have to carefully consider if the economy is strong enough to absorb a rate hike.

Prime Minister May's Conservatives are wrapping up a party conference, and to the surprise of some analysts, there were no fireworks to report at the gathering. Ahead of the meeting, there had been speculation that May would face a challenge to her leadership from foreign secretary Boris Johnson. However, all seems calm, at least for now, and Johnson has said he fully supports May. The Conservatives are still smarting from a disastrous election in June, with May being blamed for running a lackluster campaign. She has also zigzagged on Brexit, and has recently toned down her rhetoric, notably with a conciliatory speech in Florence. Still, the Brexit talks have been difficult, with little progress to report after several rounds of negotiations. Key sticking points between Britain and the European Union include the amount that Britain will pay upon leaving, whether the European High Court will have jurisdiction over EU citizens living in Britain, and the border with Ireland. There is also discussion about a transition period, which British businesses argue is crucial for a smooth shift to the post-Brexit era.

Will the Federal Reserve press the rate trigger one final time in 2017? Just a few weeks ago, federal futures had priced in a December hike at below 50 percent, but the odds have surged to 76 percent, according to the latest CME Fed Watch release. Although FOMC members remain divided on the prudence of another rate hike in 2017, Fed Chair Janet Yellen has broadly hinted that she favors a December move, and the markets have picked up on her message. The US economy continues to perform well, and the labor market remains close to capacity. The Achilles heel in an otherwise strong economy is inflation, which remains well below the Fed's target of 2 percent. If sentiment towards a December hike remains high, the US dollar will be attractive to investors and could gain ground.

Technically the pair should drop at least towards the 38.2% retracement level after the false breakout above the warning line (wl1) and the median line (ml) of the minor ascending pitchfork. You should be careful later because the price wil be driven by the fundamental factors.

Price is trading in the red on the short term and tries to retreat after the minor rebound. Technically is expected to drop aggressively in the upcoming period if will really fail to retest the upper median line (uml) of the descending pitchfork. Now is pressuring the 1.2460 static support (resistance turned into support).

Could reach also the median line (ml) of the blue ascending pitchfork, a valid breakdown below this obstacle will announce a further drop. Only a valid breakout above the upper median line (uml) will signal a further increase.

Price dropped as much as 55.67 level today, but failed to stay near it and now has squeezed a little. Brent is strongly bearish on the short-term and looks too heavy to be stopped at this moment. Is focused on correction after a false breakout, remains to see how long this will be because technically it should drop further in the upcoming months. However, we still need a confirmation that we'll have a major drop on the medium term, that's why I'm waiting for the price to come back in the upcoming days to retest and confirm some resistance levels.

Price dropped even if the USD/CAD is losing altitude, Brent will slide further if the United States data will come in better than expected. The greenback needs support from the US economy, a stronger dollar will bring more pressure on the oil's price.

Price dropped further and is targeting the downside line of the up channel, could reach this in the upcoming days even if we'll have a minor rebound. The perspective is bearish on the short term, but it could turn to the upside to retest the 250% Fibonacci line (descending dotted line) before will resume the corrective phase.

The false breakout above the median line (ML) of the ascending pitchfork signaled that we may have a major drop on the short to the medium term, but we still need a confirmation before we can take action again. Brent could come to retest also the median line (ML), only a rejection from it or a failure to reach this dynamic resistance will send the price towards the next important downside obstacles (61.8%, 50%, etc.).

USD/JPY has posted losses in the Wednesday session. Currently, the pair is trading at 112.42, down 0.38% on the day. In the US, ADP Nonfarm Payrolls kicks off this week’s job reports, with the indicator expected to slow to 131 thousand. The ISM Nonfarm Manufacturing PMI is forecast to edge up to 55.5 points. We’ll also hear from Federal Reserve Chair Janet Yellen, who will deliver remarks at an event hosted by the St. Louis Fed. On Thursday, the US releases unemployment claims, which is expected to drop to 266 thousand.

The Japanese economy has rebounded in 2017, and GDP has expanded for six consecutive quarters. The sore point in the economy is chronically low inflation, but there was some good news earlier this week. BoJ Core CPI, the inflation indicator relied upon by the BoJ, accelerate to 0.6% in August, its strongest gain since May 2016. This reading follows Tokyo Core CPI, which rebounded in September with a respectable gain of 0.5%, its best gain since March 2015. Still, inflation levels remain well below the BoJ inflation target of just below 2.0%, and BoJ Governor Haruhiko Kuroda has been crystal clear that he has no plans to tighten its accommodative monetary policy until inflation levels move higher. Inflation isn’t expected to climb anytime soon, and the BoJ has acknowledged this, saying that is doesn’t expect its inflation target of around 2.0% to be reached before fiscal year 2020.

Will the Fed make a rate move in December? Just a few weeks ago, federal futures had priced in a December hike at below 50 percent, but the odds have surged to 76 percent, according to the latest CME Fed Watch release. Although FOMC members remain divided on the prudence of another rate hike in 2017, Fed Chair Janet Yellen has broadly hinted that she favors a December move, and the markets have picked up on her message. The US economy continues to perform well, and the labor market remains close to capacity. The Achilles heel in an otherwise strong economy is inflation, which remains well below the Fed’s target of 2 percent. If sentiment towards a December hike remains high, the US dollar could gain ground.

After failing to pass a new health care act through a skeptical Congress, will Donald Trump succeed with tax reform? Last week, the White House announced the new tax proposal, called the Unified Tax Reform Framework, which includes lowering corporate and personal income taxes. However, the plan is sketchy and short on specifics, most importantly, how will the plan be paid for? Trump has insisted that the cuts will trigger strong economic growth which will more than pay for itself. However, Moody’s, the well-respected credit rating company, is not impressed by the rhetoric. On Monday, Moody’s said that the tax plan is “likely credit negative”, arguing that tax cuts would not be offset in spending cuts, which would result in a higher federal budget deficit and debt. The reduction in federal government revenue would negatively affect the US credit rating. Some Republican lawmakers have already come out against the plan, so it appears that the proposal will have an uphill battle to pass through the House of Representatives and the Senate.

• Will Yellen and Draghi offer insight into rate hikes and tapering?
• ADP may offer important insight into Friday's NFP;
• Spanish IBEX down as Catalonia prepares to declare independence.

After kicking off the week with two record closes, US indices are currently seen opening marginally lower on Wednesday as we prepare for speeches from Federal Reserve Chair Janet Yellen and ECB President Mario Draghi.

While the two central banks are in very different phases of the tightening cycle, both heads are facing very similar problems in that there is a strong desire within the banks to become less accommodative before the end of the year but the data is making life difficult. Inflation in particular is a massive headache for many central banks around the world, with the normal models proving ineffective in determining when it will return to target.

The longer the central bank's models fail to correctly anticipate price increases, the more likely it is that policy makers lose faith in the forecasts and withdraw their support for tighter monetary policy, something traders appear to be banking on next year when it comes to the Fed. The ECB may have a little more time given they're much earlier in the cycle, they're expected to move much slower and the amount of remaining slack is still significantly higher.

It will be interesting to get the views of the two central bank heads today and traders will likely be paying very close attention to what they have to say regarding meetings later this year. With the Fed currently indicating that one more rate hike is likely and the ECB giving the impression that a further asset purchase reduction will happen, traders are naturally curious about whether these views are changing in light of recent data. As it is, traders have only recently become convinced that we'll see another Fed rate hike this year and the possibility of more next year is only just being priced in.

Central bankers aside, we'll also get some noteworthy US economic data today. The ADP employment report is always followed closely, with it intending to be an estimate of Friday's NFP number. This may be the case more so this month, with its reputation but not being entirely reliable possibly being set aside as traders look for any insight into what impact the hurricanes had on hiring last month. Fewer than 100,000 jobs are expected to have been created last month but the reality could be very different and today's ADP may offer some insight on this.

Markets in Europe have mostly traded in the red this morning, particularly the Spanish IBEX which is down more than 2%, with yields on the countries debt also climbing after the head of Catalonia's devolved government claimed they will declare independence from Spain at the end of this week or the beginning of next. The handling of the referendum at the weekend by Spanish authorities has already seen the situation deteriorate more than it may have otherwise done and as we near the weekend, it could deteriorate much further again creating more uncertainty for Spanish investors.

The two pairs, that favor USD weakness are USDCAD and USDNOK, where we see both at the end of a corrective rally. They might have already reached a top, but we still want to see more weakness before we may confirm a bearish trend. USDCAD would have to see a fall below channel support line and through 1.2400, while USDNOK needs to get below 7.9299 region.

USDCAD, 1H

USDNOK, 4H

Spot Gold price bounced on Wednesday after hitting fresh seven-week low at $1268 the previous day. Tuesday's action ended in Doji, signaling hesitation ahead of strong supports at $1265/63 (daily cloud base/Fibo 61.8% of $1204/$1357 ascend).

Gold is expected to consolidate within daily cloud (cloud top lies at $1290 and is reinforced by Tenkan-sen) before broader bears resume. Break below $1265/63 would generate strong bearish signal for extension of downtrend from $1357) towards weekly cloud top at $1348. Alternative scenario requires sustained lift above daily cloud top to sideline immediate bears and generate bullish signal for extended correction.

Res: 1278, 1280, 1290, 1296
Sup: 1271, 1268, 1265, 1263