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Daily Pivots: (S1) 110.82; (P) 111.16; (R1) 111.40; More...

Intraday bias in USD/JPY remains neutral for the moment. Downside of retreat should be contained by 110.44 support to bring another rally. On the upside, above 112.07 will extend larger rise to 61.8% projection of 102.58 to 111.65 from 109.11 at 114.71 next. However, break of 110.44 will dampen the bullish case and turn focus back to 109.11 support.

In the bigger picture, break of 111.71 resistance suggests that the whole corrective decline from 118.65 (2016 high) has completed at 101.18 (2020 low) already. Medium term bullishness is also affirmed as USD/JPY stays well above 55 week EMA (now at 108.60). Sustained trading above 111.71 will affirm this bullish case. Rise from 101.18 could then be resuming whole rally from 98.97 (2016 low) through 118.65. This will now be the preferred case as long as 108.71 support holds.

Daily Pivots: (S1) 0.7211; (P) 0.7243; (R1) 0.7295; More...

Intraday bias in AUD/USD remains neutral at this point. On the downside, below 0.7169 will target a test on 0.7105 low. Firm break there will resume whole decline from 0.8006 for 0.6991 support next. On the upside, above 0.7315 minor resistance will turn bias back to the upside for 0.7477 resistance instead.

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) 1.2599; (P) 1.2669; (R1) 1.2710; More...

Intraday bias in USD/CAD remains neutral for the moment. On the downside, break of 1.2592 will extend the fall from 1.2891, as the third leg of the pattern from 1.2947, to 1.2492 support and possibly below. On the upside, break of 1.2891 resistance will bring retest of 1.2947 high. Overall, with 1.2421 support intact, rise from 1.2005 should still be in progress for another rise through 1.2947 at a later stage.

In the bigger picture, fall from 1.4667 is seen as the third leg of the corrective pattern from 1.4689 (2016 high). It should have completed after hitting 1.2061 (2017 low) and 50% retracement of 0.9406 to 1.4689 at 1.2048. Sustained break of 38.2% retracement of 1.4667 to 1.2005 at 1.3022 will pave the way to 61.8% retracement at 1.3650 and above. Overall, medium term outlook remains neutral at worst with 1.2048/61 support zone intact.

On Friday, the US Dollar fell by 110 pips or 0.87% against the Canadian Dollar. The currency pair was pressured lower by the 50– and 200– hour SMAs during Friday's trading session.

All things being equal, the exchange rate could continue to edge lower during the following trading session. The potential target for sellers would be near the 1.2560 level.

However, the lower boundary of a descending channel pattern could provide support for the currency exchange rate within this session.

On Friday, the British Pound surged by 124 pips or 0.83% against the Japanese Yen. The surge was stopped by a resistance level formed by the 200– hour simple moving average at 150.68 during Friday's trading session.

The exchange rate is currently trading near the upper line of a descending channel pattern and could be set for a breakout.

If the breakout occurs, bullish traders could pressure the GBP/JPY pair higher within this session.

However, if the channel pattern holds, a decline towards the 149.00 level could be expected today.

The Australian Dollar fell by 29 pips or 0.40% against the US Dollar on Friday. The decline was stopped by the 200– hour simple moving average during Friday's trading session.

Currently, the exchange rate is trading near the upper boundary of a descending channel pattern and could be set for a breakout.

If the breakout occurs, a surge towards the resistance level at 0.7310 could be expected within this session.

However, if the channel pattern holds, sellers may pressure the currency exchange rate lower on Monday.

The EUR/JPY currency pair consolidated above the support level at 128.60 on Friday.

Technical indicators suggest selling signals on the 4H and daily time-frame charts. Most likely, the Japanese Yen could edge higher against the common European currency within the following trading session. The potential target for the exchange rate might be near the 128.00 level.

However, the support level at 128.60 could provide support for the currency exchange rate within Monday's trading session.

Daily Pivots: (S1) 149.53; (P) 150.14; (R1) 151.05; More...

Intraday bias in GBP/JPY remains neutral at this point. On the upside, above 150.92 minor resistance will turn bias back to the upside for 152.54. Firm break there will suggest that correction from 156.05 has completed, and turn near term outlook bullish for retesting this high. On the downside, however, sustained break of 149.03 key support will carry larger bearish implication and target 13.78 fibonacci level.

In the bigger picture, rise from 123.94 is seen as the third leg of the pattern from 122.75 (2016 low). As long as 149.03 support holds, such rise would still resume at a later stage. However, sustained break of 149.03 support will indicate rejection by 156.59 (2018 high). Fall from 156.05 would at least be correcting the whole rise from 123.94 (2020 low). Deeper fall would be seen back 38.2% retracement of 123.94 to 156.05 at 143.78 first.

General trend

• Equity indices pare gains amid trading halts for Evergrande and Evergrande Property Services; Evergrande speculated to sell majority stake in Property Services unit to Hopson Development.
• Vaccine makers trade generally lower after news related to Merck’s COVID pill.
• Japanese shipping cos. extend losing streak.
• Fast Retailing [largest Nikkei component] is due to issue monthly sales after the Tokyo close.
• HK casino names reverse gains on Macau/Zhuhai news.
• S&P ASX 200 rises after sharp drop on Friday [-2%]; Financials, Resources and Consumer Discretionary indices gain.
• Singapore traded higher on reduced quarantine period for travelers arriving and easing of entry requirements.
• NZD declined ahead of Wed’s RBNZ decision, there has also been some focus on the new COVID cases.
• Soybean FUTs decline ahead of US comments on China trade strategy.
• Shanghai markets are closed for holiday from Oct 1-7 (Fri-Thurs).

Headlines/Economic Data

Australia/New Zealand

• ASX 200 opened 0.0%.
• (NZ) RBNZ Shadow Board: Lockdown divides Shadow Board’s views on tightening.
• (NZ) Reserve Bank of New Zealand (RBNZ): Maintaining focus on economic wellbeing and prosperity - Annual Report.
• (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$369.3B v A$365.8B prior.
• CBA.AU Completes A$6.0B off market share buyback at A$88.62/shr (79.4% scale back rate applied above priority allocation).
• (NZ) New Zealand PM Ardern: Extends Auckland Lv 3 lockdown, to be reviewed weekly; Rest of country to remain at lv 2.

Japan

• Nikkei 225 opened +1.0%.
• (JP) Japan LDP Sec Gen Amari said government will immediately compile a large extra budget after the general elections - financial press.
• 9984.JP Vision Fund 2 portfolio has quintupled the number of investments in startups in less then 9 months (115 so far) - press.
• (JP) Japan Fin Min Aso (outgoing): Believe international tax agreement will be official this month, currency has remained stable, at one point proposed to BOJ to lower 2% CPI target.
• (JP) Said that incoming Japan PM Kishida will hold a lower house election on Oct 31st - Press.
• (JP) Japan parliament officially elects Kishida as PM.

Korea

• Kospi closed for holiday.
• (KR) North Korea to restore inter-Korean hotline starting today – Yonhap.

China/Hong Kong

• Hang Seng opened -0.4%; Shanghai Composite to reopen Friday.
• 6666.HK Hopson to acquire 51% stake for HK$40B - Chinese press.
• (HK) Hong Kong largest independent trade union, Confederation of Trade Unions (HKCTU), disbanded on Sunday due to Security Law.
• (HK) Hong Kong Govt adviser David Hui: Reopening border with China will take 4-5 months of talks – SCMP.
• (HK) Hang Seng to announce Q3 review results Nov 19th.
• (HK) Macau halts border resumption plan with China Zhuhai city (Guangdong Province).
• 992.HK Shanghai Exchange accepts application related to CDR issuance.

Other

• (TW) China sent 77 warplanes into Taiwan defense zone over the past 2 days - Taiwan press citing Govt.

North America

• (US) Fed Vice Chair Clarida in 2020 financial disclosure traded into stocks day before Powell made statement on pandemic [in Feb 2020], said they were pre-planned for rebalancing - press over weekend.
• (CN) US Trade Rep Tai set to unveil China trade policy Monday after concluding top to bottom review of last administration's trade policy; expected to say that China is not complying with the Phase 1 trade deal; US said to consider potential actions against China [including possible additional tariffs], cites non-compliance with trade deal..
• NEO Guardant Health said to have decided against takeover offer – press.

Europe

• (UK) Govt has drawn up proposal to permanently replace agreement with the EU that’s in place to maintain an open border between Ireland and Northern Ireland - UK press.
• (UK) Reportedly UK Fin Min Sunak planning £500M fund to help people get into work - press.
• (UK) Trade Sec Truss: A post Brexit agreement with US President Biden, is not the "be all to end all" of trade deals, refuses to commit to signing a FTA with US by 2030 - UK press.
• (EU) Former ECB chief Trichet: In Europe, currently, you could say that the thesis that inflation is transitory can be accepted; the same claim in the US calls for some skepticism - press.

Levels as of 01:15ET

• Hang Seng -2.1%; Shanghai Composite closed for holiday; Kospi closed for holiday; Nikkei225 -1.1%; ASX 200 +1.2%.
• Equity Futures: S&P500 -0.1%; Nasdaq100 -0.3%, Dax -0.4%; FTSE100 -0.2%.
• EUR 1.1614-1.1588; JPY 111.11-110.89; AUD 0.7283-0.7252; NZD 0.6953-0.6927.
• Commodity Futures: Gold +0.2% at $1,761/oz; Crude Oil -0.4% at $75.61/brl; Copper -0.3% at $4.19/lb.

Daily Pivots: (S1) 128.53; (P) 128.79; (R1) 129.03; More....

Intraday bias in EUR/JPY is mildly on the downside for retesting 17.91 support. Firm break there will resume the whole decline from 134.11 to 127.07 resistance turned support next. On the upside, though, break of 130.45 resistance will argue that correction from 134.11 has completed and turn near term outlook bullish for retesting this high.

In the bigger picture, rise from 114.42 is seen as a medium term rising leg inside a long term sideway pattern. As long as 127.07 resistance turned support holds, further rise is still expected to retest 137.49 (2018 high). However, firm break of 127.07 will argue that the medium term trend has reversed, deeper fall would be seen to 61.8% retracement of 114.42 to 134.11 at 121.94.