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Daily Pivots: (S1) 1.3510; (P) 1.3530; (R1) 1.3566; More...

GBP/USD is still bounded in range below 1.3594 and intraday bias stays neutral. With 1.3389 support intact, further rally is in favor. On the upside, above 1.3594 will resume the rebound from 1.3140 to retest 1.3787 high. On the downside, however, break of 1.3389 support will extend the corrective pattern from 1.3787 with another fall, and target 1.3140 support.

In the bigger picture, up trend from 1.3051 (2022 low) is in progress. Next medium term target is 61.8% projection of 1.0351 to 1.3433 from 1.2099 at 1.4004. Outlook will now stay bullish as long as 55 W EMA (now at 1.3104) holds, even in case of deep pullback.

Daily Pivots: (S1) 0.7988; (P) 0.8002; (R1) 0.8019; More….

USD/CHF recovered after edging lower to 0.7984 and intraday bias is turned neutral first. The current favored case is that corrective rebound from 0.7871 has completed at 0.8170. Below 0.7984 will target 0.7910 support, and then retest 0.7871. However, break of 0.8103 resistance will turn bias to the upside to resume the rebound from 0.7871 through 0.8170.

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 0.8475 resistance holds.

Daily Pivots: (S1) 0.6539; (P) 0.6550; (R1) 0.6564; More...

AUD/USD's rebound lost momentum ahead of 0.6567 resistance and retreated. Intraday bias remains neutral for the moment. On the upside, firm break of 0.6567 should confirm that corrective pattern from 0.6624 has completed at 0.6413, and larger rally is ready to resume. Retest of 0.6624 high should be seen next. On the downside, break of 0.6504 resistance turned support will turn bias back to the downside to extend the corrective pattern with another fall, and target 0.6413 support, and possibly below.

In the bigger picture, there is no clear sign that down trend from 0.8006 (2021 high) has completed. Rebound from 0.5913 is seen as a corrective move. While stronger rally cannot be ruled out, outlook will remain bearish as long as 38.2% retracement of 0.8006 to 0.5913 at 0.6713 holds. Nevertheless, considering bullish convergence condition in W MACD, even in case of another fall through 0.5913, downside should be contained above 0.5506 (2020 low).

Daily Pivots: (S1) 1.3735; (P) 1.3749; (R1) 1.3764; More...

Intraday bias in USD/CAD remains neutral for the moment. On the downside, decisive break of 1.3720 will argue that the corrective pattern from 1.3538 has already completed at 1.3923. Intraday bias will be back on the downside for 1.3574 support first. Break there will bring retest of 1.3538 low. On the upside, though, break of 1.3813 resistance will retail near term bullishness, and bring retest of 1.3923 high instead.

In the bigger picture, price actions from 1.4791 medium term top could either be a correction to rise from 1.2005 (2021 low), or trend reversal. In either case, further decline is expected as long as 1.4014 cluster resistance (38.2% retracement of 1.4791 to 1.3538 at 1.4017) holds. Next target is 61.8% retracement of 1.2005 (2021 low) to 1.4791 at 1.3069.

Daily Pivots: (S1) 0.9353; (P) 0.9368; (R1) 0.9390; More....

Intraday bias in EUR/CHF remains neutral at this point. More consolidations could be seen above 0.9317. Still, current development suggests that corrective pattern from 0.9218 might have completed with three waves up to 0.9452 already. Further decline is in favor as long as 0.9403 resistance holds. On the downside, below 0.9317 will target 0.9265 support first. Firm break there should resume larger fall to retest 0.9204 low. Nevertheless, break of 0.9403 will dampen this view and bring stronger rise back to 0.9452 resistance instead.

In the bigger picture, the down trend from 0.9204 (2018 high) might still be in progress considering that EUR/CHF is staying well inside the long term falling channel. However, with bullish convergence condition in W MACD, downside potential should be limited in case of another fall. Instead, firm break of 0.9660 resistance will be an important sign of medium term bullish trend reversal.

Daily Pivots: (S1) 0.8632; (P) 0.8652; (R1) 0.8665; More...

EUR/GBP failed to sustain above 0.8670 resistance and retreated, and intraday bias stays neutral. On the upside, firm break of 0.8672 resistance will retain near term bullishness and extend the rebound from 0.8595 to retest 0.8752 high. However, sustained trading below 38.2% retracement of 0.8354 to 0.8752 at 0.8600 will indicate near term bearish reversal and target 61.8% retracement at 0.8506.

In the bigger picture, the structure from 0.8221 medium term bottom are not impulsive enough to suggest that it's reversing the down trend from 0.9267 (2022 high). But even if it's a correction, further rise could still be seen to 61.8% retracement of 0.9267 to 0.8221 at 0.8867. Nevertheless, sustained trading below 55 W EMA (now at 0.8513) will argue that the pattern has completed and bring retest of 0.8221 low.

Daily Pivots: (S1) 1.7834; (P) 1.7884; (R1) 1.7915; More...

Intraday bias in EUR/AUD remains neutral for the moment. On the downside, sustained break of 38.2% retracement of 1.7245 to 1.8155 at 1.7807 should confirm that whole rise from 1.7245 has completed. Corrective pattern from 1.8554 should then be in its third leg. Further decline should be seen to 61.8% retracement at 1.7593. On the upside, break of 1.7979 resistance will retain near term bullishness and bring retest of 1.8155 resistance instead.

In the bigger picture, price actions from 1.8554 medium term top are seen as a corrective pattern. Such pattern could extend further with another falling leg. But even in that case, downside should be contained by 38.2% retracement of 1.4281 (2022 low) to 1.8554 at 1.6922 to bring rebound. Uptrend from 1.4281 is expected to resume at a later stage.

Daily Pivots: (S1) 171.94; (P) 172.24; (R1) 172.68; More...

Intraday bias in EUR/JPY is back on the upside with break of 172.99. Further rise should be seen to retest 173.87 high. Decisive break there will resume larger rally from 154.77, and target a retest on 175.41 key resistance. On the downside, however, break of 171.09 will turn bias to the downside for 169.69 support, and possibly below.

In the bigger picture, current rally from 154.77 is still tentatively seen as resuming the larger up trend. Firm break of 175.41 (2024 high) will confirm and target 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. However, sustained break of 38.2% retracement of 161.06 to 173.87 at 168.97 will delay this bullish case, and probably extend the correction from 175.41 with another fall.

The week started slowly in the US and Canada as markets were closed for the Labour Day holiday.

In Asia, Chinese equities retreated after Monday’s rally backed by hopes of improved China–India ties. A nearly 20% jump in Alibaba shares, after the company reported a triple-digit surge in AI revenues, lifted the Hang Seng Index by 2% on Monday before some profit-taking this morning. Alibaba briefly reached its highest level since April before pulling back. The Chinese AI rally still appears to have room to run.

In energy, US crude opened the week on a firmer footing as a softer dollar and fading hopes for Ukraine peace talks outweighed concerns over India’s reluctance to buy US crude. Those factors helped oil bulls retest the $65pb resistance, with scope to extend toward $66–67.70pb range that aligns with the 50- and 200-DMAs.

In metals, gold hit a fresh all-time high above $3’500 per ounce in Asia, surpassing its April peak. The rally reflects a softer dollar but also strong central-bank and institutional demand as investors rotate out of US Treasuries. The share of US Treasuries held by foreign central banks has been declining for over a decade, but that shift into gold accelerated this year amid US debt concerns, ratings downgrades, trade tensions and geopolitical risks. Central banks’ gold allocations even surpassed their US Treasury holdings this year. Meanwhile, Indian pension funds are seeking approval to invest in gold ETFs, hinting at strong demand despite record price. Silver also surged to its highest level since 2011. Both metals have further room to run. Yet, with the gold–silver ratio still above its long-term range of 60–80, silver may have greater upside potential.

In Europe, equities posted modest gains on Monday after PMI data suggested a faster expansion in euro area manufacturing. Germany’s figure slipped just below 50, but Italy and France moved back into expansion territory after prolonged contractions. The release helped the euro rise to 1.1736 against a broadly weaker dollar, though sellers quickly re-emerged as the widening French–German 10-year yield spread revived concerns over French political risk. Separately, Paris accused Rome of fiscal dampening, adding another layer to French tensions. That said, France’s budget strains are not viewed as contagious so far, which should limit broader euro-area fallout. The CAC 40 remains vulnerable — both to fiscal worries and weakening demand in the luxury sector — while the broader Stoxx 600 has been supported by strength in defense, utilities, and banks. Any French-related selloff could be interesting buying opportunity.

On the data front, attention now shifts to the euro-area CPI flash estimate for August. Headline inflation is expected at 2.0%, with core easing to 2.2% — both near the European Central Bank’s (ECB) target. A print in line with expectations should reinforce the view that the ECB will hold rates steady in September. The next move is still likely a cut; softer growth could justify one more 25bp reduction by year-end. Yet markets now assign less than a 40% chance of another cut in 2025, down from ~50% in July.

This relative hawkishness versus the Federal Reserve (Fed) has supported the euro’s rebound since late August. However, if eurozone growth disappoints, ECB doves could regain the upper hand. CFTC data show net speculative euro longs have risen sharply this year, largely on hopes of stronger military/security spending and diversification away from US assets. Central banks have also increased their euro holdings: official buyers accounted for 20% of eurozone bond issuance so far in 2025 (vs. 16% in 2024), while an OMFIF survey pointed at a net 16% of central banks plan to increase euro reserves over the next 12–24 months (vs. 7% last year).

In the short term, the euro’s appreciation already reflects much of this, meaning crowded long positioning could leave it vulnerable to a pullback. A flare-up in French politics would be a natural trigger. But in the medium run, the euro’s outlook remains constructive thanks to diversification away from US assets.

In focus today

In the euro area, flash inflation figures for August will be released. Following lower-than-expected inflation in France, Spain, Italy, we project euro area HICP inflation to come in at 2.0% y/y, below the expected 2.1% y/y, despite an upside surprise in Germany. For the ECB, we anticipate that the August inflation print will not alter their assessment of inflation, and we continue to expect the deposit rate to remain unchanged at 2% through the rest of the year and in 2026.

From the US, ISM Manufacturing index will be released for August in the afternoon. The preliminary PMI released earlier surprised clearly to the upside, and the regional Fed manufacturing indices are also pointing towards an uptick despite the ongoing political.

Economic and market news

What happened yesterday

In the euro area, the unemployment rate fell to 6.2% in July from 6.3% in June, as widely expected, driven by a reduction in unemployed persons. The decline was primarily led by Greece and Italy, while France and Germany recorded slight increases in unemployment. We expect modest employment growth in the coming years, aligning with workforce expansion, and project an average unemployment rate of 6.2% in 2025 and 6.1% in 2026. The unemployment rate is likely to remain a hawkish argument for the ECB.

Additionally, euro area final manufacturing PMI was revised up to 50.7 in August, making a larger upside than initially reported. The revision was largely driven by France, where the manufacturing sector continues to benefit from lower interest rates and energy prices, a trend we expect to persist for the remainder of 2025.

In Sweden, manufacturing PMI rose to 55.3 in August from 54.4 in July, reaching a new high for 2025. While PMI shows stronger momentum, it contrasts with the less optimistic NIER survey on manufacturing confidence. As PMI often leads, it could signal a potential recovery in the NIER survey. Growth was primarily driven by business volume, new orders and delivery times, with reduced global trade policy uncertainty also contributing.

In Norway, manufacturing PMI fell to 49.6 in August (prior: 51.1), indicating a slowdown in manufacturing activity. However, it is important to note that hard data has been significantly stronger than PMI signals throughout Q2 and into Q3, so we currently place limited emphasis on PMI readings. Employment dropped to 42.8, the lowest since May 2020, aligning with Friday's NAV figures and reflecting weakening labour demand.

Equities: European equities edged slightly higher yesterday, rising 0.3% (Eurostoxx 50), while US markets were closed. Industrials outperformed, likely buoyed by the slight positive revision in the European manufacturing PMI and the record-low unemployment rate in the euro area. Additionally, Swedish PMIs delivered very strong results. Sweden often leads the European manufacturing cycle by approximately nine months, making this noteworthy. The headline PMI printed at 55, with orders accelerating to an index level of 57. This indicates a sharp sequential improvement in August and represents the best momentum in the sector since 2021/2022.

FI and FX: NOK and SEK were on the rise yesterday - the latter supported by stronger PMIs, while the former shrugged off disappointing PMIs. EUR/SEK slipped below 11.00 for the first since June. EUR/USD hovered in the 1.16-1.17 range despite heightened French political uncertainty. Bond yields in Europe rose a couple of basis points yesterday, with UK slightly underperforming European peers. Tightening pressure on the 10Y German swap spread prevailed yesterday.