Sample Category Title

Daily Pivots: (S1) 0.9098; (P) 0.9137; (R1) 0.9160; More....

Intraday bias in USD/CHF remains neutral at this point. Further decline is expected as long as 0.9174 resistance holds. Break of 0.9084 will resume the fall from 0.9367 to 0.9017 support, and then 0.8925. On the upside, however, break of 0.9174 resistance will indicate short term bottoming and turn bias back to the upside for stronger rebound instead.

In the bigger picture, the corrective structure of the rebound from 0.8925 argues that fall from 0.9471 is not complete yet. It could either be the second leg of pattern from 0.8756 (2021 low), or resuming larger down trend from 1.0237 (2018 high). We'd pay attention to the downside momentum and assess the odds later. But for now, medium term outlook will be neutral at best as long as 0.9471 resistance holds.

Daily Pivots: (S1) 113.13; (P) 113.57; (R1) 113.85; More...

Intraday bias in USD/JPY remains neutral as consolidation from 114.69 is still extending. On the downside, break of 113.24 will bring deeper pull back, but downside should be contained above 112.07 resistance turned support to bring rebound. On the upside, firm break of 114.69 will resume the larger up trend to 100% projection of 102.58 to 111.65 from 109.11 at 118.18 next.

In the bigger picture, corrective decline from 118.65 (2016 high) should have completed at 101.18 already. Rise from the 102.58 is seen as the third leg of the up trend from 101.18. Next target is 114.54 resistance and then 118.65 high. This will now be the preferred case as long as 109.11 support hold, even in case of deep pull back.

Market movers today

• A quiet start to a quiet week in terms of economic data releases. Norway's manufacturing production for September will be released this morning.
• Later this week, US CPI for October will be released on Wednesday and consensus looks for a slight uptick given the ongoing wage pressures and supply shortages. Chinese PPI released on Wednesday is also expected to further accelerate from the current elevated levels. On the Euro Area, German ZEW index released on Tuesday will offer a first glimpse of the November growth momentum.
• Finally, the University of Michigan's Consumer sentiment survey for November, which released on Friday, will be followed for the key inflation expectations measure.
• A number of central bank speeches will also attract attention throughout the week following last week's meetings - Fed's Powell will be on the wires on Tuesday.

The 60 second overview

Strong US jobs report: The US jobs report on Friday was strong. Not only was jobs growth in October higher than anticipated, there were also significant upward revisions to the previous two months. The reason is likely a combination of declining COVID-19 cases and some lagged effects from the expiration of higher benefits. Wage growth remains high amid still subdued participation. Jobs growth may decelerate again over the winter if the US is hit by another COVID-19 wave (which is our base case) but will remain positive. From a Fed perspective this also means higher pressure for tightening faster than what policymakers are signalling right now. We still expect two rate hikes next year (25bp in both September and December).

German slowdown: More signs the German manufacturing sector is slowing down with industrial production down 1.1% in September contributing to Germany's lacklustre growth performance. Car production remains 30% below pre-pandemic levels. Order books remain full and supply bottlenecks remains the key issue.

China: This morning exports beat expectations with October up 27.1% y-o-y reflecting booming goods demand, easing power crunch and may improvement in supply chains.

Equities: Global equities higher Friday once again driven by DM and not least US stocks while EM lagged driven by Chinese stocks. US stocks have had an impressive run with S&P500 higher in 16 out of the last 18 trading days and are now 3% above the peak early September. Friday gave renewed tailwind for value stocks after suffering Thursday. One could also put it the other way around saying growth stocks lagged as healthcare was beaten on weakness in many vaccine related names. In the US on Friday, Dow +0.6%, S&P 500 +0.4%, Nasdaq +0.2%, Russell 2000 +1.4%. The positive tone from Friday on Wall Street has not carried over to EM where markets are lower this morning. Futures in Europe and US are also lower as we head into a new week.

FI: Over the past two weeks we have been reminded that central bank communication is not a simple task in Europe and has significant impact on interest rates, volatility and spreads. Last week ended with a solid decline in interest rates, volatility as well as spread compression between core-EU and the periphery as ECB "back-tracked" on the comments from the ECB meeting.

FX: EUR/USD temporarily dropped to 1.151 on the relatively strong US jobs report on Friday, but quickly rebounded. EUR/GBP held on to the gains after the dovish BOE meeting Thursday trading in the 0.855-0.86 range.

Credit: Sentiment was good in credit on Friday. ITraxx Xover tightened 3.6bp (closing in 244bp) and Main 0.6bp (to 48.2bp). HY bonds tightened 3bp and IG 0.5bp.

Daily Pivots: (S1) 0.7371; (P) 0.7392; (R1) 0.7423; More...

Outlook in AUD/USD remains unchanged. On the downside, sustained trading below 55 day EMA (now at 0.7394) will argue that rebound from 0.7105 is complete with three waves up to 0.7555. That would also argue that fall from 0.8006 is ready to resume through 0.7105 low. On the upside, above 0.7470 minor resistance will turn bias back to the upside for 0.7555 resistance again.

In the bigger picture, with 0.6991 cluster support (38.2% retracement of 0.5506 to 0.8006 at 0.7051) intact, we're seeing price action from 0.8006 as a correction only. That is, up trend from 0.5506 low would resume after the correction completes. In that case, main focus will be 0.8135 key resistance (2018 high). Sustained break there will carry larger bullish implications. However, sustained break of 0.6991 will argue that the whole medium term trend has indeed reversed.

Daily Pivots: (S1) 1.2435; (P) 1.2458; (R1) 1.2479; More...

USD/CAD is still extending the consolidation from 1.2286. Intraday bias remains neutral and outlook is unchanged. Upside should be limited by 1.2497 to complete the consolidation to bring fall resumption. On the downside, break of 1.2286 will resume the fall from 1.2947 to retest 1.2005 low. However, firm break of 1.2497 will turn bias back to the upside for stronger rebound.

In the bigger picture, the rejection by 38.2% retracement of 1.4667 to 1.2005 at 1.3022 argues that rebound from 1.2005 is merely a corrective rise, which is complete. More importantly, the down trend from 1.4667 (2020 high) is not over yet. Sustained break of 1.2005 will extend the down trend to next long term fibonacci level at 61.8% retracement of 0.9406 to 1.4689 at 1.1424. In any case, outlook will not turn bullish as long as 1.2947 resistance holds.

Daily Pivots: (S1) 0.8548; (P) 0.8571; (R1) 0.8594; More...

Intraday bias in EUR/GBP stays on the upside as rebound from 0.8401 is in progress for 0.8656 resistance. Firm break there will argue that whole down trend from 0.9499 has completed. Stronger rise would be seen to 38.2% retracement of 0.9499 to 0.8401 at 0.8820. On the downside, break of 0.8459 minor support will bring retest of 0.8401 low instead.

In the bigger picture, price actions from 0.9499 (2020 high) are still seen as developing into a corrective pattern. Deeper fall could be seen as long as 0.8656 resistance holds, towards long term support at 0.8276. However, firm break of 0.8656 resistance would argue that a medium term bottom was already formed. Stronger rise would be seen to 0.8861 support turned resistance to confirm completion of the corrective pattern.

Daily Pivots: (S1) 1.5580; (P) 1.5624; (R1) 1.5668; More...

Further rise could be seen in EUR/AUD with 1.5532 minor support intact. Sustained break of 55 day EMA (now at 1.5770) will argue that whole fall from 1.6434 has completed and bring stronger rally. On the downside, however, below 1.5532 minor support turn turn bias back to the downside for 1.5354. Break there will target a test on 1.5250 low.

In the bigger picture, the down trend from 1.9799 (2020 high) is in progress. Firm break of 1.5250 low will confirm resumption and target 61.8% retracement of 1.1602 (2012 low) to 1.9799 at 1.4733. Sustained break there could bring more downside acceleration to 61.8% projection of 1.9799 to 1.5250 from 1.6434 at 1.3623. In any case, break of 1.6434 resistance is needed to signal medium term bottoming, or outlook will stay bearish.

Daily Pivots: (S1) 1.0532; (P) 1.0554; (R1) 1.0574; More....

EUR/CHF continues to lose downside momentum, but further decline is expected with 1.0602 resistance intact. Current down trend from 1.1149 would target 100% projection of 1.1149 to 1.0694 from 1.0936 at 1.0481. On the upside, however, break of 1.0602 will turn bias to the upside for stronger rebound back towards 1.0678 support turned resistance.

In the bigger picture, current downside momentum argues that fall from 1.1149 is probably resuming the down trend from 1.2004 (2018 high). Next focus is 1.0505 (2020 low). Decisive break there will confirm this bearish case and target 61.8% projection of 1.2004 to 1.0505 to 1.1149 at 1.0223 next. Strong support from 1.0505 will bring rebound first. But outlook will stay bearish as long as 1.0936 resistance holds.

General trend

• US equity FUTs have remained lower.
• Hang Seng has also remained modestly lower; TECH index declines [ecommerce names drop amid comments from Chinese regulator on Singles Day sales practices].
• Evergrande said to have 2 USD coupon payments due on Monday (Nov 8th).
• HK-listed COVID vaccine makers drop after Pfizer released data on COVID pill.
• Macau casino names and CN tourism index rise amid news related to HK/CN travel.
• Shanghai Composite ended morning trading slightly higher; Property index had modest gain.
• Nikkei has pared the opening gain; Softbank Group trades modestly weaker, expected to report Q2 earnings after the Tokyo close.
• S&P ASX 200 has moved slightly lower after opening flat [Financial and Consumer Indices lag].
• Companies due to report during the NY morning include Coty, Lincoln Educational, TreeHouse Foods, TowerJazz, The Trade Desk, US Foods, Marriott Vacations.

Headlines/Economic Data.

Australia/New Zealand

• ASX 200 opened 0.0%.
• SXY.AU Confirms improved A$4.60/shr offer from Posco, board to unanimously recommend.
• SYD.AU To be acquired for A$8.75/shr cash by Sydney Aviation Alliance for A$23.6B; Boards unanimously recommends.
• BHP.AU To divest 80% stake in BHP Mitsui Coal (BMC) to Stanmore for $1.2B.

Japan

• Nikkei 225 opened +0.4%.
• (JP) No COVID deaths reported in Japan for 1st time in 15 months - Japan press.
• (JP) Bank of Japan (BOJ) Summary of Opinions from Oct meeting: Japan economy likely to improve gradually as pent up demand materializes.
• (JP) Japan Oct FX Reserves $1.40T v $1.41T prior.
• (JP) Japan Sept Preliminary Leading Index CI: 99.7 v 99.8e; Coincident Index: 87.5 v 87.9e [3rd straight decline for the coincident index] Japan gov't cuts view on coincident index (1st cut since 2019).

Korea

• Kospi opened -0.1%.
• (KR) South Korea has been dealing with shortage of urea water solution, known as diesel exhaust fluid, as China tightened exports of fertilizers and related materials, including urea, in October amid a power crisis caused by a coal supply shortage, to import from Australia to ease issues – Yonhap.
• (KR) South Korea Oct instant noodle (ramyeon) prices +11% y/y (largest increase in 12 years).

China/Hong Kong

• Hang Seng opened -0.5%; Shanghai Composite opened 0.0%.
• (CN) CHINA OCT FOREIGN RESERVES: $3.218T V $3.200TE.
• (CN) CHINA OCT TRADE BALANCE $84.5B V $64.0BE (record high); Exports Y/Y: 27.1% v 22.4%e; Imports Y/Y: 20.6% v 26.0%e, Sept Trade Balance with US: $40.7B v $42.0 prior; YTD +33.3% y/y.
• (CN) CHINA OCT TRADE BALANCE (CNY-DENOMINATED): 546.0B V 387.0BE; Exports Y/Y: 20.3% v 14.9%e.
• Imports Y/Y: 14.5% v 20.2%e, Coal imports 26.9Mt v 32.9Mt prior; Rare earth exports 4.3Kt v 3.92Kt prior (highest since March).
• (CN) China said to be ready to make Regional Comprehensive Economic Partnership (RCEP) trade deal tariff cuts – press.
• (HK) Hong Kong to China Quarantine free travel may have 1.0K visitor/day cap – Press.
• (CN) China PBOC sets Yuan reference rate: 6.3959 v 6.3980 prior.
• (CN) China PBOC Open Market Operation (OMO): Injects CNY100B in 7-day reverse repos v CNY100B prior; Net inject CNY90B v Net drain CNY100B prior.
• (CN) China State Planner (NDRC): Daily Coal Production has hit highest level in the recent years.
• (CN) China National Petroleum Corp (CNPC) to halt oil exports through end of year.

Other

• (PH) Philippines Q3 Agriculture Output Y/Y: -2.6% v -1.5% prior.
• 2330.TW Ensured no customer specific data was disclosed to US in the data request.
• UAE Energy Min Mazrouei: OPEC+ is working to balance market and incentivize investments; Without OPEC+, energy prices would be higher than they are currently.

North America

• PFE CEO Bourla: Targeting to submit data from investigational Covid-19 pill to FDA by Nov 25th - press.
• (US) US National Security Council spokesman Lieberman: US and China are not considering reopening closed consulates in each country - denies press report.
• AA Plans to Restart Curtailed Aluminum Smelting Capacity at Portland Aluminium in Australia.
• TSLA Elon Musk asks Twitter if he should sell 10% of his stock in Tesla, saying he will follow results of poll; currently 57.9% say Yes, 42.1% No.
• (US) House passes bipartisan $1.2T infrastructure bill, clearing the way for President Biden's signature.

Levels as of 00:15ET

• Hang Seng -0.3%; Shanghai Composite +0.4%; Kospi -0.6%; Nikkei225 -0.2%; ASX 200 -0.1%.
• Equity Futures: S&P500 -0.2%; Nasdaq100 -0.4%, Dax +0.1%; FTSE100 -0.1%.
• EUR 1.1570-1.1553; JPY 113.64-113.36; AUD 0.7414-0.7387; NZD 0.7127-0.7104.
• Commodity Futures: Gold +0.2% at $1,820/oz; Crude Oil +1.3% at $82.33/brl; Copper +0.2% at $4.36/lb.

Daily Pivots: (S1) 130.80; (P) 131.20; (R1) 131.55; More....

EUR/JPY is staying in correction from 133.44 and deeper fall could be seen. But downside should be contained above 130.45 resistance turned support to bring rebound. On the upside, above 132.55 minor resistance will bring retest of 133.44 first. Firm break there will resume larger up trend from 114.42. However, firm break of 130.45 will dampen our bullish view and bring deeper fall back to 127.91 key support.

In the bigger picture, rise from 114.42 (2020 low) is still in progress and the strong support support from 55 week EMA affirms medium term bullishness. Further rise would be seen to retest 137.49 (2018 high). Decisive break there will resume the whole long term rise from 109.03 (2016 low). Next target will be 100% projection of 109.03 to 137.49 from 114.42 at 142.88. This will now remain the favored case as long as 127.91 support holds.