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Daily Pivots: (S1) 153.99; (P) 154.14; (R1) 154.38; More...

USD/JPY recovered after drawing support from 55 4H EMA, but stays below 154.47 resistance. Intraday bias remains neutral for the moment. Further rally is expected as long as 151.52 support holds. Above 154.47 will resume larger rise from 139.87 to 100% projection of 146.58 to 153.26 from 149.37 at 156.05. Break there will pave the way to 158.85 key structural resistance.

In the bigger picture, current development suggests that corrective pattern from 161.94 (2024 high) has completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94 high. On the downside, break of 145.47 support will dampen this bullish view and extend the corrective pattern with another falling leg.

Daily Pivots: (S1) 0.8078; (P) 0.8094; (R1) 0.8120; More…

Intraday bias in USD/CHF remains on the upside for 100% projection of 0.7828 to 0.8075 from 0.7872 at 0.8119. Break there will extend the corrective rally from 0.7828 to 138.2% projections at 0.8213. On the downside, break of 0.8066 minor support will suggest that deeper pullback might be underway, and turn bias to the downside for 55 4H EMA (now at 0.8025).

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8332 support turned resistance holds (2023 low).

The latest ADP private employment report provided a modest dose of reassurance to the Fed, showing that U.S. job growth may be stabilizing after a period of softness. Following the data, Fed funds futures reflected roughly 70% chance of a December rate cut, up slightly from last week but still leaving room for doubt.

Markets appear cautiously optimistic that policy easing remains on track, but investors are waiting for confirmation from upcoming nonfarm payrolls and inflation releases. For now, the Fed’s “wait-and-see” message continues to anchor expectations.

Broader market reactions, however, were subdued. The mood in risk assets steadied after Tuesday’s sharp tech-led selloff, which erased earlier optimism around AI and growth stocks. U.S. equity futures traded flat, suggesting investors are reluctant to rebuild risk exposure too quickly. While the worst appears to have passed for now, renewed selling in technology shares could return later in the session if rebound attempts fail to gain traction.

In the currency markets, the weekly performance picture is little changed. Yen remains the strongest performer, supported by safe-haven demand, followed by Dollar and Euro. At the weaker end, Kiwi continues to lag, trailed by Aussie and Loonie, while Sterling and the Swiss Franc trade in mid-range.

In Europe, at the time of writing, FTSE is up 0.17%. DAX is down -0.34%. CAC is down -0.04%. UK 10-year yield is up 0.029 at 4.459. Germany 10-year yield is down -0.002 at 2.654. Earlier in Asia, Nikkei fell -2.50%. Hong Kong HSI fell -0.07%. China Shanghai SSE rose 0.23%. Singapore Strait Times fell -0.13%. Japan 10-year JGB yield fell -0.01 to 1.667.

US ADP jobs rise 42K in October, large firms lead modest rebound

U.S. private-sector employment rose modestly in October, with ADP reporting a gain of 42k jobs, slightly above expectations of 32k. It was the first increase since July, suggesting some stabilization in hiring after months of softness. However, the pace of job creation remains well below levels seen earlier in the year, pointing to a labor market that is cooling gradually rather than collapsing.

Sector data showed 33k new service jobs and 9k in goods production. Large firms (+73k) drove most of the gains. Small (-10k) and medium-sized (-21k) companies continued to shed workers. Wage growth remained steady, with job-stayers up 4.5% yoy and job-changers up 6.7% yoy, both unchanged from September.

Overall, the data suggest hiring is stabilizing at lower levels, aligning with the Fed’s goal of cooling the economy without triggering widespread job losses.

Eurozone PPI edges lower, energy costs weigh

Eurozone producer prices dipped slightly in September. PPI fell -0.1% mom and -0.2% yoy, matching market expectations.

The decline was led primarily by softer energy prices, which fell -0.2% on the month, while prices for intermediate and capital goods remained stable. Among consumer categories, durable goods rose 0.3% and non-durable goods edged up 0.1%.

Across the broader European Union, producer prices rose 0.1% mom and 0.1% yoy, suggesting only a mild uptick in cost pressures. The largest monthly declines were seen in Bulgaria and Finland (-0.7%), while Romania (+1.2%), Estonia (+0.7%), and Lithuania (+0.4%) posted the biggest increases.

Eurozone composite PMI hits 29-month high as Germany leads recovery

Eurozone business activity accelerated strongly in October, with HCOB Services PMI finalized at 53.0, the highest in 17 months, up from 51.3 in September. Composite PMI also climbed to 52.5, a 29-month high, signaling the region’s strongest pace of expansion since early 2023. The rebound was broad-based across major economies, though notable divergences remain, with Spain and Germany leading the upturn while France continues to lag.

Among individual countries, Spain topped the rankings with a Composite PMI of 56.0, marking a 10-month high. Germany’s index surged to 53.9, its best in 29 months, followed by Ireland (53.7) and Italy (53.1). In contrast, France slipped further into contraction at 47.7, an eight-month low.

According to Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, the services sector’s upswing was supported by the strongest growth in new business since May 2023. Rising orders encouraged firms to hire more staff, providing hope that the expansion could prove sustainable into year-end.

Cost inflation in services has eased slightly, though selling price inflation ticked up, suggesting companies are regaining some pricing power amid firmer demand. For the ECB, the PMI figures pose no immediate inflationary threat.

UK PMI composite finalized at 52.2, firmer growth, easing inflation pressures

The UK services sector showed encouraging signs of recovery in October, with PMI Services finalized at 52.3, up from September's 50.8. Composite PMI also improved to 52.2 from 50.1.

According to Tim Moore, Economics Director at S&P Global Market Intelligence, the latest survey “offered some positive signals,” as both output and new business growth accelerated notably from September’s lows.

Service providers reported stronger client demand and a pickup in new orders, particularly in domestic markets. Many firms cited resilient consumer spending and a turnaround in new client wins as key drivers of October’s improvement. The data also pointed to labour market stabilization, with job cuts slowing sharply and business expectations rising to a 12-month high.

While higher wages were still pushing up costs, the overall pace of input inflation fell to its lowest level since November 2024. Selling prices increased at the slowest pace since June.

BoJ minutes: Hawks urge gradual tightening, others prefer to wait

Minutes from the BoJ’s September policy meeting revealed a deeply divided board, with members debating the pace and timing of future rate hikes. The nine-member board voted to keep the policy rate steady at 0.5%, rejecting calls by two hawkish members who wanted to raise borrowing costs to 0.75%. The discussion centered on balancing the downside risks to growth against persistent inflationary pressures, particularly from elevated food prices.

Some members argued for moving sooner rather than later. One hawkish participant called for raising rates at “somewhat regular intervals”, citing an improving flow of data, including corporate earnings and the Tankan business survey, as valuable indicators to guide normalization. Another member warned that the cost of waiting too long to tighten policy was “gradually increasing,” even if it would allow the BoJ to gain more clarity on the global outlook, especially from the U.S.

However, the majority on agreed it was better to wait for “a little more hard data” before considering another move. They noted that while conditions for tightening were gradually being met, acting now could “surprise the market” and risk destabilizing financial conditions. Some emphasized that as long as inflation expectations remain insufficiently anchored, maintaining accommodative conditions was appropriate to support Japan’s recovery.

Another member highlighted uncertainty surrounding the U.S. slowdown as a key reason to stay cautious, but conceded that, based purely on domestic fundamentals, Japan might soon meet the conditions for another hike.

New Zealand labor market stagnates, unemployment rate rises to 5.3%

New Zealand’s labor market showed further signs of softening in the Q3, with total employment flat at 0.0% qoq, missing expectations for a small 0.1% qoq rise. On an annual basis, employment fell -0.6% yoy.

Unemployment rate ticked up from 5.2% to 5.3%, in line with forecasts, extending a full year of readings above 5%. The last time joblessness reached this level was in late 2016. Labor-force participation rate slipped 0.2 ppt to 70.3%, suggesting some workers are leaving the active job market.

Wage growth also cooled, with all-sector earnings up 0.4% qoq and 2.1% yoy, indicating reduced pressure on labor costs.

China RatingDog PMI Services falls to 52.6, export orders contract

China’s service sector expansion eased slightly in October, with the RatingDog PMI Services slipping from 52.9 to 52.6, in line with expectations. Composite PMI also moderated to 51.8 from 52.5. While domestic demand improved, weakness in overseas orders capped momentum, reflecting the impact of renewed global trade instability on China’s external-facing industries.

RatingDog founder Yao Yu said new export business “fell noticeably into contractionary territory” amid "increased instability in the global trade environment". However, total new orders still expanded as domestic demand strengthened. Business expectations remained high even though confidence edged slightly lower. Employment stayed in contraction, but the pace of job losses eased.

Price pressures were uneven. Input costs rose for an eighth consecutive month, reaching their highest level since October 2024. On the other hand, output prices slipped back into contraction, implying margin compression for service providers.

USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 0.8078; (P) 0.8094; (R1) 0.8120; More…

Intraday bias in USD/CHF remains on the upside for 100% projection of 0.7828 to 0.8075 from 0.7872 at 0.8119. Break there will extend the corrective rally from 0.7828 to 138.2% projections at 0.8213. On the downside, break of 0.8066 minor support will suggest that deeper pullback might be underway, and turn bias to the downside for 55 4H EMA (now at 0.8025).

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8332 support turned resistance holds (2023 low).

U.S. private-sector employment rose modestly in October, with ADP reporting a gain of 42k jobs, slightly above expectations of 32k. It was the first increase since July, suggesting some stabilization in hiring after months of softness. However, the pace of job creation remains well below levels seen earlier in the year, pointing to a labor market that is cooling gradually rather than collapsing.

Sector data showed 33k new service jobs and 9k in goods production. Large firms (+73k) drove most of the gains. Small (-10k) and medium-sized (-21k) companies continued to shed workers. Wage growth remained steady, with job-stayers up 4.5% yoy and job-changers up 6.7% yoy, both unchanged from September.

Overall, the data suggest hiring is stabilizing at lower levels, aligning with the Fed’s goal of cooling the economy without triggering widespread job losses.

Full US ADP release here.

Eurozone producer prices dipped slightly in September. PPI fell -0.1% mom and -0.2% yoy, matching market expectations.

The decline was led primarily by softer energy prices, which fell -0.2% on the month, while prices for intermediate and capital goods remained stable. Among consumer categories, durable goods rose 0.3% and non-durable goods edged up 0.1%.

Across the broader European Union, producer prices rose 0.1% mom and 0.1% yoy, suggesting only a mild uptick in cost pressures. The largest monthly declines were seen in Bulgaria and Finland (-0.7%), while Romania (+1.2%), Estonia (+0.7%), and Lithuania (+0.4%) posted the biggest increases.

Full Eurozone PPI release here.

• The shutdown may end soon.
• Increased volatility supports the dollar.
• The Bank of Japan recalls deflation.
• The pound is frightened by tax increases.

Progress in negotiations between Democrats and Republicans on resuming government operations has cooled the enthusiasm for the US dollar among bulls. The dollar index has taken a step back from its local high, as the record-long shutdown may soon come to an end. The Fed will begin to receive data and will cease to be cautious. The chances of a rate cut in December have risen to 74%, and Treasury yields have fallen.

The greenback was supported by increased demand for safe-haven assets amid a pullback in US stock indices and the Supreme Court’s willingness to hear the case on the legality of tariffs. Predictit gives a 73% probability that Donald Trump will lose. Polymarket estimates the chances of such an outcome at 64%. The cancellation of import duties will be a blow to the US economy and the dollar. Refunds and an increase in the budget deficit will require a reduction in government spending and an increase in taxes. This will slow GDP growth and force the Fed to aggressively cut rates.

Nevertheless, in the short term, increased volatility in financial markets may support the dollar and other safe-haven currencies. USDCHF and USDJPY retreated from local highs. The Swiss franc was under pressure due to concerns about the National Bank’s return to a negative interest rate policy. The yen is concerned about the Bank of Japan’s reluctance to signal a continuation of the monetary policy normalisation cycle.

In the minutes of the last BoJ meeting, some members of the Governing Board referred to the need to be cautious. In their opinion, it is necessary to consider that Japan has experienced a long period of deflation. High rates could cause it to return to that state. Such rhetoric reduces the likelihood of an imminent increase in the overnight rate and puts pressure on the yen. At the same time, increased verbal interventions and growing demand for safe-haven currencies amid rising volatility are contributing to mixed dynamics in USDJPY.

The pound fell to April lows due to Rachel Reeves’ unwillingness to repeat Labour’s pre-election pledge not to significantly raise taxes. The Chancellor blamed the previous Conservative administration and trade friction for damaging the British economy..

Market Overview

The crypto market continues its impressive decline, losing another 2.4% over the past 24 hours. Having fallen to a low of $3.3 trillion, the market is now at its lowest point since early July. A steady move below the 200-day moving average and a drop of more than 20% from its peak are sure signs of a bear market. Perhaps crypto enthusiasts are confident that this is a temporary decline, similar to the one seen in March and April. However, we would prefer not to rule out the possibility of another bear market starting in the coming years. At a time when many have buried the 4-year cycles, we still see that they have only lost amplitude but have generally retained their influence. According to these patterns, the market is close to or has already passed its peak for the next couple of years, which explains the intense selling pressure since October.

Bitcoin fell to five-digit price levels overnight, touching lows just below $99,000 twice. BTC traded steadily below these levels from February to May. And then there was a psychologically significant consolidation period in December and January. The market is now undergoing a critical test. Another step down will open the way to the $60,000-$70,000 range. However, there is a theoretical chance that BTC will quickly rebound by the end of the week from the 50-week moving average, which has served as a global support since the first half of 2023.

News Background

Early investors continue to sell off cryptocurrency. Over the past 30 days, long-term holders have sold 400,000 BTC — about 2% of the total supply of the asset, according to WeRate. Additional pressure is coming from continued outflows from spot Bitcoin ETFs.

The US government shutdown, now in its second month, is also putting pressure on Bitcoin. Another factor is the Coinbase premium, which remains in negative territory, according to CryptoQuant. This indicates sustained pressure from US sellers.

At the same time, there has been a record outflow of stablecoins from exchanges, indicating a shift of capital from risky assets to safe-haven dollar instruments.

Demand for Bitcoin from institutional investors has declined, according to Capriole. For the first time in seven months, net purchases have fallen below the daily issuance of the asset.

Bitcoin has lost significant growth potential due to the influence of large financial institutions and government structures, according to Peter Thiel, the former PayPal CEO and billionaire.

Strategy intends to conduct its initial public offering on the European stock market, issuing 3.5 million preferred shares denominated in euros. The funds will be used to purchase bitcoins and replenish working capital.

As the chart shows, the Nikkei 225 stock index (Japan 225 on FXOpen) formed a historic peak around 52,500 points only yesterday — but today it has fallen sharply, with losses at the session low reaching approximately 7%.

Bearish sentiment was fuelled in part by a slump in shares of Japanese investment giant SoftBank, which dropped by around 14%. The company’s heavy exposure to sectors linked to artificial intelligence and cryptocurrencies, both currently under pressure, has raised investor concerns.

The decline in the Nikkei 225 appears to be an extension of the sell-off in US technology stocks recorded yesterday, driven by a stronger dollar and growing fears of an AI-fuelled bubble.

Technical Analysis of the Nikkei 225 Chart

As shown by the 200- and 400-period moving averages on the 4-hour chart, Japan’s equity market remains in a long-term uptrend, with the widening gap between the two lines signalling an acceleration in growth. This supports the relevance of two upward channels:

→ a long-term channel, shown in blue;

→ an intermediate channel, marked by orange lines with a steeper gradient.

It is noteworthy that at the start of November, the Nikkei 225 entered the zone where the upper boundaries of both channels intersect – unsurprisingly, this confluence of resistance lines triggered a wave of selling pressure.

Key observations:

→ Sellers succeeded in pushing the price down towards the lower orange line, which acted as strong support, similar to the movement seen between 10–12 October (indicated by arrows on the chart);

→ Today, the price made a false bearish breakout below the psychological 50,000 level, forming a candle with a long lower shadow – a sign of buying interest.

Given the above, it is reasonable to assume that the market may attempt to resume its upward trajectory. Should this scenario play out, we could see signs of rally exhaustion, as the upward movement that began in April has already lifted the Nikkei 225 by more than 280%.

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The UK services sector showed encouraging signs of recovery in October, with PMI Services finalized at 52.3, up from September's 50.8. Composite PMI also improved to 52.2 from 50.1.

According to Tim Moore, Economics Director at S&P Global Market Intelligence, the latest survey “offered some positive signals,” as both output and new business growth accelerated notably from September’s lows.

Service providers reported stronger client demand and a pickup in new orders, particularly in domestic markets. Many firms cited resilient consumer spending and a turnaround in new client wins as key drivers of October’s improvement. The data also pointed to labour market stabilization, with job cuts slowing sharply and business expectations rising to a 12-month high.

While higher wages were still pushing up costs, the overall pace of input inflation fell to its lowest level since November 2024. Selling prices increased at the slowest pace since June.

Full UK PMI services final release here.

Eurozone business activity accelerated strongly in October, with HCOB Services PMI finalized at 53.0, the highest in 17 months, up from 51.3 in September. Composite PMI also climbed to 52.5, a 29-month high, signaling the region’s strongest pace of expansion since early 2023. The rebound was broad-based across major economies, though notable divergences remain, with Spain and Germany leading the upturn while France continues to lag.

Among individual countries, Spain topped the rankings with a Composite PMI of 56.0, marking a 10-month high. Germany’s index surged to 53.9, its best in 29 months, followed by Ireland (53.7) and Italy (53.1). In contrast, France slipped further into contraction at 47.7, an eight-month low.

According to Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, the services sector’s upswing was supported by the strongest growth in new business since May 2023. Rising orders encouraged firms to hire more staff, providing hope that the expansion could prove sustainable into year-end.

Cost inflation in services has eased slightly, though selling price inflation ticked up, suggesting companies are regaining some pricing power amid firmer demand. For the ECB, the PMI figures pose no immediate inflationary threat.

Full Eurozone PMI services final release here.