Technical Analysis By zForex

[Z Forex]

EURUSD

EURUSD Stability Amidst Shifting Global Interest Rate Dynamics
The euro is stabilizing below the 1.07 level following a turbulent week marked by significant announcements and the European Central Bank's decision to raise interest rates by 25 basis points, albeit with a less aggressive tone. Speculation about further rate hikes from the ECB has dwindled, with attention now shifting towards when the first interest rate cut might occur.
Inflationary pressures, while showing some signs of easing, still remain uncomfortably high for the European Central Bank, making any rate reduction unlikely until year-end. Consequently, much of the focus has shifted to the upcoming United States Federal Reserve meeting, where decisions regarding further interest rate increases will be made.
The US economy has responded positively to higher interest rates, with limited impact on growth and a reduced risk of recession. However, there are concerns that continued rate hikes could increase uncertainty in the US banking sector, despite its current stability.
In the short term, these developments may exert pressure on the euro, which has faced scrutiny in recent weeks. Nonetheless, it is expected that the euro's resilience will soon reemerge.
The current agenda lacks significant events that could significantly impact the euro's stability.
The EURUSD found support at the downward parallel of the current bearish long-term trend at 1.0640, which also coincides with a support level from May. A potential correction may occur when considering the DXY (US Dollar Index), which suggests that a possible comeback can be expected especially when touching the 105.50 level is close.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0940	1.0850	1.0780	1.0640	1.0600	1.0530

GBPUSD

BoE Rate Hike Speculation in Light of Economic Indicators
Cross-currency traders are speculating that the Bank of England (BoE) will implement a 25 basis point interest rate hike during the upcoming Thursday meeting. This potential rate increase by the BoE is part of the central bank's strategy to combat inflationary pressures and stabilize the British economy.
The initial reading of the US Michigan Consumer Sentiment Index for September stands at 67.7, indicating a decrease from the previous figure of 69.5. This reading also falls below the anticipated value of 69.1 for the month.
BoE Governor Andrew Bailey has suggested that the central bank is nearing the conclusion of its series of interest rate hikes. This statement, along with concerns regarding a potential recession and signs of a cooling labor market in the UK, could intensify the pressure on the BoE to temporarily halt its rate-increasing efforts.
Selling pressures on GBP/USD persist, breaching the 1.2400 support level. The subsequent support level to monitor is at 1.2300. There is a potential for a dollar correction in the near future, and if this materializes, it could lead to a correction in the currency pair.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2750	1.2650	1.2580	1.2400	1.2300	1.2200

USDJPY

USD/JPY Range-bound Ahead of Key Central Bank Meetings
The USD/JPY pair hovers between 147.68 and 147.88, staying within a narrow trading range. Both the Federal Reserve (Fed) and the Bank of Japan (BoJ) are set to hold key meetings, adding to market caution.
In recent economic data, the Empire State Manufacturing Index for August improved to 1.9 from a previous reading of -19, exceeding expectations. Industrial Production also saw a rise of 0.4% MoM in August, outperforming market forecasts. However, the preliminary Consumer Sentiment Index for September declined from 69.1 to 67.7, and the five-year Consumer Inflation Expectation dropped to 2.7% from 3%.
The market expects the Fed to maintain interest rates during its upcoming meeting, with Fed Chairman Jerome Powell expected to make no significant policy changes in his press conference. However, a dovish stance from the Fed could weaken the US Dollar (USD) and pose challenges for the USD/JPY pair.
Turning to the Japanese Yen (JPY), all eyes are on the BoJ's policy meeting scheduled for Friday. There is growing speculation that the BoJ may be closer to departing from its ultra-loose monetary policy and negative interest rates. Nevertheless, BoJ policymakers have indicated that such a move won't happen until wage and inflation data meet expectations, leaving the JPY susceptible to fluctuations against other currencies.
Investors will closely monitor the Fed's interest rate decision on Wednesday, with expectations of no changes. Subsequently, attention will shift to the Bank of Japan (BoJ) on Friday.
USDJPY's buying pressure continues, while the level of 147.7 is acting as resistance. The most probable scenario is a continuation upwards towards the 150.00 region.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
151.50	149.00	148.00	147.30	146.50	146.00

XAUUSD

Gold Prices Rise on Market Caution and USD Weakness
The gold price rose for the third consecutive day on Monday, approaching the $1,930 supply zone in the Asian session. This upward movement is attributed to several factors.
Firstly, a more cautious risk sentiment in the market is boosting demand for safe-haven assets like gold. This is partly due to concerns about China's deteriorating economic conditions, which have been exacerbated by developments related to China Evergrande Group. The company's delay in restructuring its debt and the detention of some employees from its wealth management unit in Shenzhen have added to global risk aversion, prompting investors to seek refuge in gold.
Secondly, the US Dollar (USD) has weakened slightly, providing further support to the XAU/USD pair. However, the USD's downside is limited as traders await the upcoming Federal Open Market Committee (FOMC) policy meeting, which starts on Tuesday. While the Federal Reserve (Fed) is expected to keep interest rates unchanged, there is still speculation about a potential rate hike in November or December.
Thirdly, the outlook for elevated US Treasury bond yields, which benefit the USD, may constrain additional gains for gold, as traders await further guidance on the Fed's future rate-hike plans. Key factors to watch include the monetary policy statement and Fed Chair Jerome Powell's post-meeting press conference, which could influence the direction of the USD and, subsequently, gold.
Additionally, investors will be monitoring major central bank rate decisions from the Swiss National Bank (SNB), the Bank of England (BoE), and the Bank of Japan (BoJ) later in the week. Consumer inflation figures from Canada and the United Kingdom (UK) will also be scrutinized for potential trading opportunities involving gold.
On Friday, gold experienced a correction as it retraced toward the 1931 resistance level, coinciding with the upper boundary of the current bearish channel. The resurgence of the DXY and US yields could diminish gold's appeal, potentially leading to further selling pressure on the precious metal.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1950	1942	1931	1910	1900	1885

DAX40

European Stocks Dip Ahead of Central Bank Meetings
European stocks experienced a slight decline on Monday, following substantial gains last week. Investors were preparing for a busy week filled with global central bank meetings, including interest rate decisions from Norway, Sweden, Switzerland, the UK, and the United States.
The spotlight this week is on global central banks, especially after the European Central Bank (ECB) signaled the end of rate hikes last week. The Bank of England (BoE) is expected to raise rates for the 15th time later in the week, while the Federal Reserve appears poised for a more cautious stance.
Market sentiment remained cautious as Eurozone bond yields inched higher following hawkish remarks from some ECB officials after their rate decision.
ECB Governing Council member Yannis Stournaras stressed that governments must play their part in controlling consumer prices, given that borrowing costs have possibly reached their peak.
In stock-specific news, Nordic Semiconductor ASA (NOD) tumbled 13.2% after revising its revenue guidance for the third quarter, and Fingerprint Cards (FING_B) declined by 5.8%.
Societe Generale (GLE) saw a 6.3% drop after the third-largest bank in France projected minimal to no growth in annual sales over the upcoming years, as revealed in a highly anticipated strategic plan from its new CEO.
S4 Capital (SFOR), Martin Sorrell's advertising group, experienced a substantial 22% decrease as it lowered its annual forecast for the second time in as many months, citing client caution driven by recession fears.
DAX continues inside the range of 15500 and 16000. The wider price range encompasses support at 15,500 and resistance at 16,400. In the short term, DAX went back toward the 15600 level after finding resistance at the 16000.

Resi Level 3	Resi Level 2	Resi Level 1	Suppo level 1	Suppo level 2	Suppo level 3
16600	16400	16000	15550	15400	15200

 

[Z Forex]

Fed's Economic Forecast and Chair Powell's Insights in Upcoming Meeting
The Federal Reserve is expected to keep its current interest rates unchanged this Wednesday. Nevertheless, the market's primary focus will be on the central bank's revised economic forecast, particularly the "dot plot" illustrating the expected movements in the Fed funds rate. Chair Powell's subsequent press conference will offer investors valuable insights into the potential policy adjustments leading up to the November meeting and throughout 2024.
Several ECB members are scheduled to deliver speeches today, although they might not significantly influence current market pricing or sentiment before the FOMC meeting.
EUR/USD after finding support at the downward parallel of the ongoing bearish long-term trend and a support level dating back to May. The correction took the price toward the 1.07 area while waiting for today's FOMC meeting to find direction. The next resistance level will be at the 1.0750 level followed by the median line at 1.0800.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0940	1.0850	1.0750	1.0640	1.0600	1.0530

UK's Lower-than-Expected Inflation Rate May Influence Bank of England's Decision
In August, the United Kingdom experienced a 6.7% inflation rate, which was slightly lower than anticipated and showed a small decline from the previous month. This situation could potentially impact the Bank of England's decision to pause its tightening measures after its upcoming announcement. The likelihood of a quarter-point interest rate increase on Thursday has also decreased, now having a probability of less than 60% in the market, down from the previous 90% as indicated by swap pricing.
Investors widely expect that the central bank will maintain its current interest rates when it announces its latest policy decision on Wednesday. Additionally, the Federal Reserve will release its quarterly update on various economic indicators such as interest rates, gross domestic product, inflation, and unemployment.
Regarding GBP/USD, it continues to experience a selloff today following the release of CPI numbers, which approached the 1.2300 support level and the 61.80% Fibonacci level, with the next potential support at 1.2200. The resistance level is anticipated to be at 1.2450.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2650	1.2580	1.2450	1.2400	1.2300	1.2200

USD/JPY Trading Flat Ahead of Fed and BoJ Meetings
The USD/JPY pair is trading flat around 147.83 as investors await key events. The Federal Reserve (Fed) is expected to keep interest rates unchanged at 5.25%-5.50% in its September meeting, with a 99% probability according to the CME Fedwatch Tool. This may impact the US Dollar.
US Treasury Secretary Janet Yellen noted the need for slower US growth to control inflation. Meanwhile, US Building Permits exceeded expectations, but Housing Starts dipped slightly. On the Japanese side, fears of FX intervention arise, with Japanese authorities expressing a sense of urgency. The Bank of Japan (BoJ) is expected to maintain its interest rate targets, with interest in any policy updates during its announcement.
Japanese trade data revealed a worse-than-expected Balance of Trade, while exports improved slightly, and imports increased.
Market participants are closely monitoring the Fed's decision and the upcoming BoJ announcement for trading opportunities in the USD/JPY pair. Please note that the article contains forward-looking statements and does not constitute investment advice.
USDJPY's buying pressure continues by breaking the 147.7 area and continuing toward the next big area of 150.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
151.50	149.00	148.00	147.30	146.50	146.00

Gold Prices Await Fed's Interest Rate Decision and FOMC Press Conference
Gold prices are hovering around $1,930 in Asian trading as investors adopt a wait-and-see approach in anticipation of the Federal Reserve's interest rate decision and FOMC Press Conference. These events could inject volatility into the market.
Simultaneously, the US dollar's value against major currencies remains steady near 105.10 after rebounding from a weekly low of 104.81. The yield on the US 10-year Treasury note has reached a 16-year high at 4.365%, which may limit the decline of the US Dollar (USD).
The Federal Reserve's two-day monetary policy meeting, scheduled for Wednesday, is expected to maintain interest rates in the 5.25% to 5.5% range, with a 99% probability of no change in September, according to the CME Fedwatch Tool. However, the likelihood of further rate hikes in November and December has decreased, as per the same source.
Fed Chairman Jerome Powell's Press Conference will provide insights into the 'dot plot' and inflation expectations. Rising interest rates can reduce the appeal of non-yielding assets, potentially impacting precious metals negatively.
Gold continues hovering around the 1931 resistance level. Depending on today's FOMC meeting gold may go up breaking the actual resistance toward its next target at the 1950 level or a selloff toward the 1900.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1950	1942	1931	1910	1900	1885

European Stocks Await Fed's Interest Rate Decision
European stocks experienced slight gains on Wednesday as investors awaited the US Federal Reserve's interest rate decision later in the day. British stocks, in particular, outperformed their regional counterparts due to surprising data from the UK indicating a more significant drop in inflation than expected for August.
Nonetheless, LVMH (MC) shares declined by 0.4% after being downgraded to a "hold" rating by Jefferies and receiving a price target reduction from Deutsche Bank. This development cooled investor sentiment towards the luxury brand, which has exposure to the Chinese market.
Jefferies also downgraded Kering (KER) and Moncler (MONC), causing their shares to fall by 0.8% and 0.9%, respectively.
Investors remained focused on the Federal Reserve's rate decision, with expectations that the US central bank would maintain its current interest rates.
The UK's export-oriented FTSE 100 (UK100) gained 0.6%, driven in part by a decline in the pound's value following the unexpected drop in British annual consumer price inflation (CPI) for August. This led investors to scale back their expectations of rate hikes by the Bank of England, just a day before its next policy announcement.
DAX continues inside the range of 15500 and 16000 for one month and a half. The wider price range encompasses support at 15,500 and resistance at 16,400. In the short term, DAX went back toward the 15600 level after finding resistance at the 16000.

Resi Level 3	Resi Level 2	Resi Level 1	Suppo level 1	Suppo level 2	Suppo level 3
16600	16400	16000	15550	15400	15200

 

[Z Forex]

EURUSD

EURUSD Recovers from Multi-Month Lows, But USD Index Nears Six-Month Highs
After initially dropping to fresh multi-month lows, the euro (EUR) managed to recover some of its losses against the US Dollar (USD), pushing the EURUSD pair back above the 1.0650 level at the start of the European trading session on Thursday.
The US Dollar continued its upward momentum, reaching new six-month highs near 105.70 according to the USD Index (DXY), just a few pips shy of the year-to-date peak around 105.90 seen on March 8.
The pair's pullback was influenced by corrections in short-term US yield curve segments, despite modest gains in intermediate and long-term yields. Meanwhile, 10-year bund yields approached recent highs near 2.75%.
EUR/USD retraced to the previous support level at 1.0630 following yesterday's market event. The dollar could persist in its ascent, even as the DXY hovers around its resistance level, potentially signaling a breakout. In the event of a breakout in EURUSD, the subsequent level to monitor resides at 1.0530.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0940	1.0850	1.0750	1.0640	1.0600	1.0530

Bank of England Set to Hike Rates to 5.50% Amid Growing Economic Uncertainty
The Bank of England is widely anticipated to increase the bank rate by 25 basis points (bps) from 5.25% to 5.50% at 11:00 GMT, marking the highest level since 2007. The key question is whether this signals the end of aggressive rate hikes. The BoE might take a cue from the European Central Bank (ECB) and implement a cautious rate hike, acknowledging the growing risks of stagflation.
In Q2, the UK economy surprised with a 0.2% expansion, but economists remain pessimistic, citing delayed effects of higher rates. Unemployment rose to 4.3% in July, with 207K job losses, worsening conditions from June's 66K loss. However, average earnings (excluding bonuses) rose 7.8% YoY in July.
Given the slowing economy and weakening labor market, the BoE could hint at a pause post-hike. Governor Andrew Bailey hinted at nearing the end of the tightening cycle, but Catherine Mann advocated caution to prevent inflation overshooting.
Surprisingly, UK inflation eased, with CPI at 6.7% in August, below expectations. Services CPI also decreased to 6.8% YoY. This might influence the BoE's decision, with markets now pricing in a 57% chance of a rate hike pause, up from 20%. Goldman Sachs expects the BoE to maintain the rate at 5.25% and has revised its terminal rate forecast accordingly.
GBP/USD extended its decline toward the 1.2300 support level, in line with other major currencies, as the dollar gained strength following yesterday's meeting. The outcome of today's Bank of England (BOE) meeting will likely impact the future direction. The next support levels to watch are at 1.2200 and 1.2100, while resistance is anticipated at 1.2400.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2580	1.2450	1.2400	1.2300	1.2200	1.2100

USDJPY Nears Year-to-Date Highs but Faces Caution Ahead of Potential Intervention
The USDJPY pair recently reached a year-to-date peak of approximately 148.45 during the Asian trading session today. However, it has experienced a slight pullback, currently trading around 148.17, with only a minor decrease of less than 0.12% for the day, indicating potential for further appreciation.
This upward momentum is supported by the recent breakthrough of a strong horizontal barrier at 146.50-146.60 and the potential for a daily close above 148.50, which would trigger bullish sentiment. The overall positive outlook for the USDJPY pair is further reinforced by the Federal Reserve's hawkish stance, which continues to boost the US Dollar (USD).
Nonetheless, there is a note of caution due to comments by Japan's Chief Cabinet Secretary Hirokazu Matsuno, who has not ruled out intervention in response to foreign exchange movements, which could support the Japanese Yen (JPY) and limit gains in the USD/JPY pair. Additionally, speculations that the Bank of Japan (BoJ) may move away from its negative interest rate policy contribute to the strength of the JPY.
The bullish momentum of USDJPY remains strong, surpassing the current level at 148, and there is potential for further advancement toward 150. However, it is essential to remain mindful of the possibility of intervention, given our proximity to a historical level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
151.50	149.00	148.00	147.30	146.50	146.00

Gold Prices React to Hawkish Fed Decision and Strengthening US Dollar
Gold is currently trading around $1,930 as investors shift their attention to upcoming US economic data following the Federal Reserve's decision to maintain interest rates at 5.5%. The Fed's hawkish stance on interest rates, including an expected rate hike in 2023 and revised projections for 2024, has bolstered the US Dollar (USD), with the US Dollar Index (DXY) hitting a six-month high of approximately 105.50.
Higher US Treasury yields, notably the 10-year US Treasury note reaching 4.43%, have contributed to the USD's strength and increased the opportunity cost of holding non-yield-bearing assets like gold. Federal Reserve Chair Jerome Powell reiterated the central bank's commitment to achieving its long-term inflation target of 2% but noted that future policy decisions would be data-driven.
Investors are closely monitoring upcoming US data releases, including Initial Jobless Claims, the Philadelphia Fed Manufacturing Survey, and Existing Home Sales figures, for insights into the US labor market, manufacturing sector, and real estate market.
Gold came back after the dollar and yields went high after the FOMC meeting. Gold's next support will be at 1910 the level followed by the 1900.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1950	1942	1931	1910	1900	1885

European Stocks Dip After Fed's Hawkish Tone, Await Central Bank Decisions
On Thursday, European stocks experienced a decline, influenced by the previous night's losses on Wall Street following the US Federal Reserve's indication of maintaining higher interest rates for an extended period. This dip occurred just before rate announcements from several central banks, including the Swiss National Bank, Riksbank, Norges Bank, and the Bank of England.
Sectors related to commodities, such as mining (SXPP) and energy (SXEP), both declined by over 1%, primarily due to weakening metal and crude prices in response to a stronger US dollar.
The Federal Reserve, as widely anticipated, maintained its key interest rates unchanged on Wednesday but raised its economic forecasts, cautioning that the battle against inflation was ongoing. Consequently, the technology-heavy Nasdaq (IXIC) closed 1.5% lower.
Market attention is currently focused on the forthcoming monetary policy decisions from Switzerland, Sweden, Norway, and the UK later in the day. This comes in the wake of the European Central Bank (ECB) recently raising its key interest rate to a record high of 4%.
DAX inside the range of 15500 and 16000 for close to two months without a change. The wider price range encompasses support at 15,500 and resistance at 16,400. In the short term, DAX went back toward the 15600 level after finding resistance at the 16000.

Resi Level 3	Resi Level 2	Resi Level 1	Suppo Level 1	Suppo level 2	Suppo level 3
16600	16400	16000	15550	15400	15200

 

[Z Forex]

EURUSD

US Fed Holds Rates Steady, Signals Hawkish Outlook for Inflation Control
The US Federal Reserve held interest rates steady on Wednesday but struck a hawkish tone, signaling that a further hike is on the cards later this year and that rates will likely stay elevated for a prolonged period as the central bank looks to exert sustained downward pressure on inflation.
Fed Chairman Jerome Powell reiterated that the top priority is restoring price stability and ensuring that inflation won’t rear its head again.
Data from the EU is waiting for today to assess the economic performance of PMIs of the region. The economic activity in the region is deteriorating month after month, and Lagarde mentioned the same thing in the last ECB meeting focusing on the service activity.
EUR/USD is at a solid support level fighting for a breakout. The pair seems more oriented to continue its bearish trend and break toward the next 1.0550 support and historical level.

Resistance 3	Resistance 2	Resistance1	Support 1	Support 2	Support 3
1.0940	1.0850	1.0750	1.0640	1.0600	1.0530

GBPUSD

Bank of England Pauses Rate Hikes with Lower-Than-Expected Inflation
The Bank of England has stopped its 14 consecutive interest rate hikes as new data reveals inflation is lower than anticipated. After raising rates since December 2021, bringing the primary policy rate to 5.25% in August from 0.1%, the bank voted 5-4 to maintain this rate at its September meeting. They noted signs of the monetary policy's impact on the labor market and the real economy. The bank also unanimously voted to reduce its government bond purchases by £100 billion over the next year to a total of £658 billion. The decision followed lower-than-expected UK inflation figures for August. Despite pausing, Bank of England Governor Andrew Bailey emphasized the need for vigilance. The move signals the bank's cautious approach to balancing inflation control with economic stability. UK GDP contracted by 0.5% in July, and some companies issued profit warnings. The US Federal Reserve also maintained interest rates but hinted at one more hike by year-end. Analysts are speculating whether this pause represents the peak of the interest rate cycle, with concerns about cooling wage growth and a possible recession in developed markets in 2024.
GBP/USD is under significant selloff pressures after yesterday's BoE meeting and breaking a significant level toward the next target of 1.2200, followed by the 1.2100 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2580	1.2450	1.2400	1.2200	1.2100	1.2000

USDJPY

BoJ Governor Hints at Potential Policy Changes
BoJ Governor Kazuo Ueda, in a post-policy meeting press conference, hinted at potential changes, including ending yield curve control and adjusting the negative interest rate policy to reach a 2% inflation target. Ueda stressed that BoJ's policy-making process remains data-driven.
Inflation hasn't stabilized at 2%, and October's policy decision will factor in variables like government actions such as gasoline subsidies. BoJ stands ready for additional easing given economic uncertainty. Japan's National Consumer Price Index for August was 3.2%, slightly down from 3.3%. The National CPI ex-Fresh Food remained at 3.1%.
The US Dollar Index is around 105.40, influenced by surging US Treasury yields at 4.49% since 2007. Market watchers closely monitor data, including preliminary US S&P Global PMIs, for insights into the US economy. Recent data, like decreasing Initial Jobless Claims (201,000), initially boosted the US Dollar. However, the Philadelphia Fed Manufacturing Survey disappointed, and August's Existing Home Sales declined.
The Federal Reserve maintained interest rates within the range of 5.25% to 5.50%, reiterating its commitment to a 2% inflation target. Fed Chairman Jerome Powell emphasized the possibility of future rate hikes if they prove necessary.
USDJPY's bullish momentum continues stronger with the pair preparing to go beyond the 148.5 level and continue further toward 150 area. But always the probability of intervention should be taken into consideration as we are close to reaching a historical level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
151.50	149.00	148.00	147.30	146.50	146.00

XAUUSD

Gold Prices Inch Higher as Markets Digest Fed's Hawkish Stance
Gold prices rose slightly during the Asian session, bouncing back from the weekly low of $1,913-$1,914, marking the end of a three-day losing streak.
Despite this uptick, there isn't a clear catalyst for the move. The Federal Reserve's hawkish stance, with its readiness to raise interest rates until inflation reaches the 2% target, continues to support the US dollar, which could limit significant gains for gold. The Fed hinted at another 25-basis points rate hike by year-end, and the 'dot-plot' suggests a benchmark rate of 5.1% in 2024, implying fewer rate cuts in the coming year. Additionally, the US Labor Department reported a drop in new unemployment claims to an eight-month low, indicating a tight labor market. These factors enable the Fed to keep rates high, pushing yields in the US fixed-income market higher.
The rise in benchmark yields, with the 10-year treasury yield hitting a 16-year peak, is bolstering the US dollar and restraining gold's upward movement, given its status as a non-yielding asset.
As a result, it's wise to wait for more significant buying momentum before considering bullish positions in XAU/USD. Market participants are now awaiting the release of flash PMI data, which will provide insights into the global economy's health.
The downward pressure on gold is still present, and the price does not appear to have established a clear trend in the short term. The resistance level at the 1947 level and the support level at 1912 are key levels that the price needs to breach in order to determine its direction definitively.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1950	1942	1931	1910	1900	1885

DAX40

European Stocks Decline Following Central Bank Decisions and Economic Data
European stocks declined on Friday, heading for a weekly close marked by central bank decisions, as investors assessed the likelihood of enduring high borrowing costs. The pan-European STOXX 600 index slipped 0.3% by 0745 GMT, following a more than 1% drop in the previous session. The Bank of England (BOE), like the US Federal Reserve, kept rates steady but expressed that its work was not yet complete.
The STOXX 600 initially fell 0.7% but later recovered some losses as preliminary data revealed a slowdown in economic activity in France and Germany, raising hopes of a more accommodative policy stance from the European Central Bank (ECB).
AstraZeneca rose 2% after announcing positive results for its breast cancer drug in a late-stage trial. On the flip side, oil and gas group Vaar Energi fell 7.3% due to a stake sale by Norway's HitecVision. Adevinta saw an 18.4% surge in shares following a takeover proposal led by Permira and Blackstone. Meanwhile, Stellantis, the parent company of Chrysler, faced labor negotiations as a coordinated strike loomed.
Spain's GDP grew by 0.5% in the second quarter, with British retail sales rebounding in August. Investors awaited PMI data from the UK and EU.
DAX inside the range of 15500 and 16000 for close to two months without a change. The wider price range encompasses support at 15,500 and resistance at 16,400. In the short term, DAX went back toward the 15600 level after finding resistance at the 16000.

Resi Level 3	Resi Level 2	Resi Level 1	Suppo level 1	Suppo level 2	Suppo level 3
16600	16400	16000	15550	15400	15200

 

[Z Forex]

The EUR/USD pair has rebounded to around 1.0590 during the Asian trading session on Tuesday, despite European Central Bank (ECB) President Christine Lagarde's comments about maintaining restrictive interest rates. Lagarde also noted expectations of "persistently high" inflation, creating a challenging balancing act for the ECB in addressing inflation without harming the Eurozone's uneven domestic economy.

The US Dollar Index (DXY) remains near 106.00, driven by cautious market sentiment and rising US Treasury yields, reaching 4.55% on the 10-year note, a level last seen in October 2007. The anticipation of sustained high interest rates is supported by the robust US economy and signals from the US Federal Reserve (Fed) for further rate hikes if needed.

Concerns of a federal government shutdown have arisen due to warnings from US President Joe Biden and a senior adviser, particularly regarding potential impacts on low-income women and children's food benefits. The possibility of budget cuts in the Republican-controlled House of Representatives adds uncertainty, as these cuts would require Senate approval.

Investors are closely monitoring key economic data releases on Friday, including the US Core Personal Consumption Expenditures (PCE) Price Index and the Eurozone's Core Harmonized Index of Consumer Prices (HICP), which could influence trading decisions in the EUR/USD pair.

EUR/USD broke the support level from the last week in a clear signal of the power of Dollar. Next target will be around the 1.0530 strong and historical level of support.

Resistance3	Resistance2	Resistance1	Support 1	Support 2	Support 3
1.0750	1.0700	1.0630	1.0600	1.0530	1.0400

The gold price continues its recent decline, falling below the $1,915 mark and hitting a one-week low on Tuesday. This drop is primarily attributed to the strong US Dollar, which has reached its highest level since December 2022 on Monday, exerting downward pressure on XAU/USD. Additionally, the Federal Reserve's hawkish stance, which was emphasized last week when they warned of persistent inflation and the possibility of another interest rate hike by year-end, contributes to the bearish sentiment for gold. Furthermore, most Fed policymakers now anticipate only two rate cuts in 2024, down from the previous projection of four.

Despite these factors, gold finds some support as investors turn cautious due to a weaker tone in equity markets, reflecting a broader risk-off sentiment. Concerns about the Fed maintaining higher rates for an extended period and worries about a housing market crisis in China deter investors from riskier assets and bolster XAU/USD. Nonetheless, a significant rebound in the price of gold remains unlikely as the consensus grows that the Federal Reserve will keep interest rates elevated.

The ongoing strength of US economic data and hawkish comments from influential Fed officials signal a persistent tightening of US monetary policy. Minneapolis Fed President Neel Kashkari even suggested that US rates may need to rise further and remain elevated for an extended period to cool down the economy. This has led to a prolonged selloff in the US fixed-income market, resulting in the yield on the two-year US government bond reaching a 17-year high. Additionally, the benchmark 10-year US Treasury note has surpassed the 4.50% threshold for the first time since 2006, reinforcing the strength of the US Dollar and confirming the bearish outlook for gold, which offers no yield.

Gold continues the selloff and come back going toward the next support at 1900 after an attempt to find a reversal way up. The yield are leading and taking all the attraction.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1950​	1942​	1931​	1910​	1900​	1885​

 

[Z Forex]

The EUR/USD pair is currently in a bearish consolidation phase, trading near 1.0555, its lowest level since March 16. The US Dollar (USD) remains strong, near a 10-month high, as the Federal Reserve (Fed) is expected to maintain higher interest rates, acting as a headwind for EUR/USD. The Fed adopted a more hawkish stance recently, warning of another interest rate hike this year.

Recent statements from Fed officials and the robust US economy support the USD, while global economic concerns and the European Central Bank's dovish rate decision weigh on the EUR/USD pair

The ECB downgraded its 2024 and 2025 CPI and GDP growth forecasts, suggesting fewer rate hikes. Speculations about a GDP contraction in the second half of the year indicate the ECB's policy tightening may have peaked.

Traders await the German GfK Consumer Climate Index and US Durable Goods Orders data. Later, attention shifts to the flash German CPI report, final US GDP figure, and Fed Chair Jerome Powell's speech, followed by the US Core PCE Price Index on Friday.

EUR/USD continue the selloff with the power of Dollar. Next target will be around the 1.0530 strong and historical level of support.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0750	1.0700	1.0630	1.0530	1.0400	1.0200

Today marks the sixth consecutive day of declining prices in the last seven days, pushing the commodity even lower, below the $1,900 mark. This is the lowest level it has reached since August 22, just as the European session begins.

The US Dollar (USD) is continuing its upward trend and has reached a new 10-month high. This surge follows the Federal Reserve's (Fed) hawkish signal that suggests interest rates will remain elevated for an extended period. This development is putting downward pressure on the price of Gold. Additionally, recent statements from Fed officials have increased expectations of at least one more interest rate hike by the end of the year. As a result, the yield on the 10-year US government bond, a benchmark, has reached its highest point since 2007. This situation is strengthening the USD and diverting investment away from Gold, which doesn't offer interest.

Despite a prevailing risk-averse environment, Gold is not receiving any significant support as a safe-haven asset. Recent data from the United States (US) released on Tuesday revealed that the Consumer Confidence Index from the Conference Board has dropped to a four-month low in September. This decline has raised concerns that consumers are feeling the strain of persistent high inflation and rising interest rates. In addition to this, worries about a real estate crisis in China, the world's second-largest economy, are dampening investors' appetite for riskier assets.

Gold experienced a significant drop, falling below the $1900 level and heading towards the $1885 support level. Yields are currently dominating and attracting all the attention.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1931​	1910​	1900​	1885​	1874​	1855​

 

[Z Forex]

During the early Asian session on Thursday, the EUR/USD pair dipped around 1.0500 due to a stronger US Dollar (USD), favorable US economic data, and higher Treasury yields. At present, EUR/USD is trading near 1.0512, up 0.09% for the day.

The US Dollar Index (DXY) has surged to 106.60, its highest since November, while the 10-year Treasury yield is at 4.618%, a level not seen since 2007.

Weak Eurozone economic data, including a drop in German Consumer Sentiment to -26.5 in October, adds to the Euro's woes. Spain and Germany will release preliminary September Consumer Price Index (CPI) figures, with Spanish inflation expected to rise and German inflation likely to fall. These inflation figures are vital for monetary policy expectations and market impact.

The USD strengthened after positive US Durable Goods Orders data in August and amidst concerns over higher interest rates versus potential US government shutdown risks. Traders await Fed Chair Jerome Powell's address for market cues.

Key releases include Spanish and German inflation data, Eurozone's Consumer and Business Confidence, US Jobless Claims, GDP revision, and Pending Home Sales. The focus turns to the US Core PCE Price Index on Friday, expected to ease from 4.2% to 3.9%, influencing the EUR/USD

EUR/USD went to its support zone and waiting for today Data to find more direction. Th general outlook is super bearish and the breakout of the actual support may lead to more selloff.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0750	1.0700	1.0630	1.0530	1.0400	1.0200

Thursday, the price of gold (XAU/USD) is facing downward pressure due to a stronger US Dollar (USD) and higher Treasury yields. Gold is currently trading at around $1,876, with a modest 0.11% gain for the day.

Simultaneously, the US Dollar Index (DXY), which measures the USD against other currencies, has surged above 106.65, its highest level since November. Furthermore, the 10-year Treasury yield is at 4.60%, its highest since 2007.

A positive turn came from the US Census Bureau's report on Wednesday, showing that Durable Goods Orders for August increased by 0.2% MoM, surpassing expectations of a 0.5% decline. This, along with other positive economic data, boosted the US Dollar and put pressure on gold.

Market sentiment is cautious, considering the possibility of a government shutdown in the US and expectations for higher interest rates. However, investors are also watching for Federal Reserve Chair Jerome Powell's speech, which could potentially influence the USD and gold prices.

Thursday will see the release of US weekly Jobless Claims, GDP revisions, Pending Home Sales data, and Friday will bring the Core Personal Consumption Expenditure Price Index. Traders will closely analyze these events for opportunities in the gold market.

Gold reached its 1875 support level continuing the make selloff direction. As Dollar and yields leading the market Gold will not have a chance to make a possible reversal up.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1931​	1910​	1900​	1885​	1874​	1855​

 

[Z Forex]

US INDICES:

Nike's Strong Earnings Propel Futures Higher, Wall Street Faces Monthly and Quarterly Losses
Nasdaq 100 futures rose by 0.6%, while S&P 500 futures saw a 0.4% increase. In premarket trading, Nike shares surged by over 7% following the company's impressive fiscal first-quarter earnings report, which exceeded analyst forecasts.
Wall Street is coming off a winning session, as the benchmark 10-year Treasury yield backed off from a fresh 15-year high. Those gains, however, did little to mitigate equities’ sharp losses for the month and the quarter.
The S&P 500 is set to finish the month down 4.6% and the quarter lower by 3.4%. The Nasdaq Composite is off nearly 6% in September, and down 4.3% for the quarter. This month will be the worst in 2023 for both indexes. The Dow is on track for a 3% decline this month and a 2.2% fall for the quarter.
Investors are now turning their attention to the latest personal consumption expenditures price index reading due Friday. The PCE reading is the Federal Reserve’s preferred inflation metric. Economists expect that the core PCE advanced 3.9% year over year in August and gained 0.2% on a monthly basis, according to Dow Jones.
On the weekly Nasdaq chart, a double top pattern has been confirmed, with the neckline located in the 14,250-14,500 area. A breakout above these levels could lead the price toward the 200-day moving average on the daily chart and the lower boundary of the current long-term bullish channel.



USOIL

Oil Prices Expected to Rise on Saudi and Russian Supply Cuts
Saudi and Russian supply cuts will likely push oil prices higher in the next three months, but the journey to $100 per barrel may be brief due to lingering economic risks, according to a Reuters survey of 42 economists and analysts. US crude is forecasted to average $79.64 per barrel in 2023 and $82.99 per barrel in 2024.
Analysts believe that Saudi Arabia and Russia will continue to influence oil prices as they extend supply cuts into 2024 to avoid price drops while managing higher government expenses. The poll indicates that oil prices will likely remain above $80 per barrel into the next year, with Brent expected to average $89.85 in the last quarter of 2023.
However, the much-discussed $100 per barrel price level appears unsustainable due to artificial supply shortages and economic fragility. Some analysts anticipate that increased production from US shale, as well as rising output from Iran and Venezuela, may offset OPEC+ supply cuts to some extent.
The International Energy Agency (IEA) predicts a market deficit through 2023, with oil demand expected to rise by 1 million barrels per day in 2024. Still, if output cuts are not maintained at the beginning of the next year, the market balance could shift to a surplus.
Higher global rates could potentially lead to a global economic recession in 2024, affecting oil demand, along with concerns about the Chinese economy.
WTI reached a new high at the $95 level and found resistance at 50%. A potential breakout is still possible as the price didn't show any signs or patterns of a probable correction. If this happens, reaching the $100 level will be achievable.


Crypto

Bitcoin's Price Takes Unusual Plunge on Binance Cryptocurrency Exchange
In the latest Bitcoin news, the price of the leading cryptocurrency, based on market capitalization, has seen some gains on shorter timeframes. However, traders on the Binance cryptocurrency exchange were taken aback when the BTC price unexpectedly plunged.
According to the cryptocurrency report by Colin Wu, Bitcoin's price plummeted on the trading platform, dropping to as low as $2,700 from its current levels. This crash, unlike previous occurrences, occurred at different times.
The incident was documented at 16:17 UTC+8 on the exchange's perpetual futures platform, one of its most popular trading instruments. Changpeng "CZ" Zhao, the CEO of the exchange, responded to the incident.
In a prior tweet, CZ explained that the problem stemmed from an issue with the trading pair's display, and the User Interface remained unaffected, as did the APIs connected to the platform.
Fortunately, this incident did not trigger any stop losses or margin calls for BTC/USDT futures positions, providing relief for traders on the platform.
BTC initially reached the 27,000 level but retraced its price after a month, fluctuating between the 27,000 mark and finding support at the 25,000 level.

 

[Z Forex]

Euro Gains Strength as US Congress Averts Shutdown and Manufacturing PMI Awaited
EUR/USD showed early strength, climbing towards 1.0600 during the European morning following a tightly-ranging Asian session. Over the weekend, the US Congress approved a short-term funding bill, temporarily averting a government shutdown by extending the previous budget for 45 days, securing government funding through November 17. This development appears to have improved market sentiment on Monday. Presently, US stock index futures are surging between 0.5% and 0.8%. If US stocks gain momentum after the market opens, the US Dollar (USD) could lose its appeal as a safe haven, potentially paving the way for a sustained EUR/USD recovery.
The ISM Manufacturing PMI for September is expected to indicate ongoing contraction in US manufacturing economic activity. A reading above 50 could initially boost the USD.
Federal Reserve (Fed) Chairman Jerome Powell is slated to speak later today. Markets are pricing in a less than 60% chance of the Fed maintaining its policy rate this year. Powell, however, is unlikely to offer strong guidance ahead of Friday's jobs report.
Eurozone inflation for September plummeted to 4.3%, the lowest since October 2021, as per flash data. Notably, the European Central Bank had raised interest rates to a record level the previous month, but economists and investors now speculate that these rates may have peaked.
EUR/USD has found support at the 1.0500 level, awaiting direction from DXY, which has also found support after a correction, indicating a possible continuation upward for the dollar. The long-term view remains bearish for EUR/USD, and a breakout of the 1.0500 level will be the next awaited scenario if there is no change in the current macroeconomic readings.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0800	1.0700	1.0650	1.0500	1.0400	1.0320

GBP/USD Under Selling Pressure as USD Strengthens

The GBP/USD pair is under selling pressure, holding at approximately 1.2180 as the USD gains strength. In August, the US Core PCE Price Index met expectations, rising by 3.9%, aligning with the prior figure of 4.3%. Attention now shifts to the US ISM Manufacturing PMI for September and an upcoming speech by Fed Chair Powell.
The US Bureau of Economic Analysis reported that the PCE Price Index increased by 3.5% YoY in August, meeting market expectations. Meanwhile, the Core PCE Price Index, a crucial inflation indicator for the Federal Reserve, also grew by 3.9%, as anticipated.
Federal Reserve officials, including John Williams and Thomas Barkin, have hinted at the Fed nearing the peak for the federal funds rate and emphasizing the need for a restrictive policy stance. Powell's upcoming speech may influence the USD's direction.
In the UK, BoE policymakers have discussed the possibility of rate adjustments, but market expectations lean toward the BoE maintaining its current monetary policy, which weighs on the GBP.
With no significant UK economic data this week, GBP/USD remains influenced by USD dynamics. Key events to watch include the US ISM Manufacturing PMI for September and Powell's speech. Later in the week, the US ADP Employment Change and ISM Services PMI for September will be released, with a focus on the US Nonfarm Payrolls report on Friday.
GBP/USD continues hovering around its support at 1.2200 right now. The bearish outlook persists, and if the dollar continues to rise, this could lead to further selloff in GBP/USD.
​

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2500	1.2400	1.2290	1.2110	1.2000	1.1900

USD/JPY Near 11-Month High, Awaits US ISM PMI Ahead of Intervention Concerns
The USD/JPY pair currently trades at 149.70, slightly below its recent 11-month peak of 149.82 during early European trading on Monday. This dip is attributed to the strengthening US Dollar (USD), fueled by expectations of prolonged US monetary policy support. Investors closely monitor the impending US ISM PMI report while exercising caution due to potential currency interventions by Japanese authorities, which could dampen bullish sentiments.
The US Dollar's vigor is evident in the US Dollar Index (DXY), reaching 106.28, its highest since the previous November. Federal Reserve (Fed) officials' remarks suggest an approaching peak for the federal funds rate and a need for a restrictive policy stance for some time. August's inflation data met expectations, with the PCE Price Index up 3.5% YoY and the Core PCE Price Index up 3.9% YoY but falling short of monthly forecasts.
Investors eagerly await Fed Chair Jerome Powell's upcoming speech, as hawkish comments could further bolster the USD/JPY pair. However, concerns over FX intervention by Japan persist, particularly near the psychologically vital 150.00 level, where the Bank of Japan (BoJ) intervened last year.
Japanese Finance Minister Shunichi Suzuki and BoJ Governor Kazuo Ueda both express caution regarding currency movements, emphasizing the BoJ's commitment to its ultra-loose monetary policy. Market focus in the coming days will center on key US economic data releases, including the US ISM Manufacturing PMI, ADP Employment Change, and ISM Services PMI, with the US Nonfarm Payrolls report on Friday holding the potential to steer the USD/JPY pair decisively.
USDJPY's bullish momentum continues stronger with the pair close to touching the critical level at 150. The intervention possibility may lead to a selloff after touching these historical levels.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Extends Losses as US Dollar Gains Strength Despite Averted Shutdown
The gold price is on a six-day losing streak as the US Dollar seeks increased demand despite the United States avoiding a government shutdown. On Saturday, the US Congress passed a stopgap funding bill with strong Democratic support to prevent the fourth partial government shutdown in a decade.
China's business PMIs over the weekend were mixed, affecting investor sentiment during the Chinese Golden Week holiday with light trading. The Caixin/S&P Global manufacturing PMI fell to 50.6 in September from 51.0 the previous month, missing forecasts of 51.2. The services index also dropped to 50.2 in September compared to 51.8 in August, marking its lowest reading since December. However, official data from China's National Bureau of Statistics (NBS) showed a better-than-expected Manufacturing PMI at 50.2 and Non-Manufacturing PMI at 51.7 for September.
Furthermore, persistent hawkish rhetoric from the US Federal Reserve (Fed) and a strong US economy are keeping the US Dollar and US Treasury bond yields strong, while gold prices remain at seven-month lows.
Next, attention turns to crucial US job data, starting with JOLTS Job Openings on Tuesday, which will provide insights into the labor market as inflation cools down. In August, the Fed's preferred inflation measure, the Core Personal Consumption Expenditures (PCE) - Price Index, softened to 0.1% MoM and 3.9% YoY.
Meanwhile, investors will keep an eye on the US ISM Manufacturing PMI and a speech by Fed Chair Jerome Powell later in the day for hints on the economy and interest rate outlook, which could significantly impact the valuation of the US Dollar and the movement of gold prices.
Gold continues the selloff and goes further toward the 1800 next strong support level. Yields and the dollar continue up after some correction which may lead to more selloff on gold.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1900	1985	1874	1857	1833	1800

 

[Z Forex]

US INDICES:

S&P 500 and Nasdaq-100 Futures Dip as Government Shutdown Averted, but Concerns Linger
S&P 500 futures experienced a 0.2% decline, while Nasdaq-100 futures saw a 0.1% drop. The Senate successfully passed a continuing resolution just hours before the midnight deadline on Saturday. President Joe Biden promptly signed the bill into law, ensuring the government remains operational for an additional 45 days. This extended period allows lawmakers the opportunity to finalize funding legislation. However, concerns linger among investors as there are unresolved disagreements regarding overall government spending, border issues, and the situation in Ukraine, potentially leading to another shutdown battle in the future.
September marked a challenging month for both the S&P 500 and Nasdaq Composite, with the S&P 500 index ending the month down by 4.9% and the quarter 3.7% lower. Meanwhile, the Nasdaq Composite, which is technology-heavy, experienced a 5.8% drop in the month and a 4.1% decline in the quarter. Investors will closely monitor economic data scheduled for release on Monday, including purchasing and construction spending reports. Later in the week, attention will shift to a series of reports that provide insights into the state of the labor market, culminating in Friday's highly anticipated monthly payroll data.
On the weekly Nasdaq chart, a double top pattern has been confirmed, with the neckline located in the 14,250-14,500 area. A breakout above these levels could lead the price toward the 200-day moving average on the daily chart and the lower boundary of the current long-term bullish channel.

USOIL

Oil Prices Surge on the Back of a Tight Supply Outlook and Aversion of Government Shutdown
Oil prices rose $1 on Monday, rebounding from losses at the end of the previous week. This increase was driven by renewed investor focus on a tight global supply outlook. Additionally, the avoidance of a U.S. government shutdown contributed to improved risk appetite in the market.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia (OPEC+), are not expected to make changes to their current oil output policy at an upcoming meeting. This decision was indicated by four OPEC+ sources.
OPEC Secretary General Haitham Al Ghais expressed confidence in oil demand, characterizing it as resilient this year. However, a Reuters survey revealed that OPEC oil output increased for the second consecutive month in September, primarily due to rises in production in Nigeria and Iran, despite Saudi Arabia's cuts.
Turkey also announced plans to restart operations on a pipeline from Iraq, which had been suspended for around six months, adding more crude supply to the market.
Furthermore, there is speculation that Saudi Arabia may ease its additional voluntary supply cut of 1 million barrels per day, citing concerns over Chinese demand. However, positive Chinese factory activity data provided some confidence, indicating a potential stabilization of the Chinese economy.
Despite the positive news from China, European manufacturing data showed that the Eurozone, Germany, and Britain remained in a downturn in September, which could impact oil demand.
WTI reached a new high at the $95 level and found resistance at the 50% level. A potential breakout is still likely as the price didn't show any signs or patterns of a possible correction. If this happens, reaching the $100 dollar level will be achievable.

Crypto

Bitcoin Surges Beyond $28,400, Setting the Stage for an Optimistic 'Uptober'
Bitcoin surged past $28,400 for the first time since mid-August, sparking optimism among investors for "Uptober." Wallet data reveals that BTC wallets holding 10-10K BTC have accumulated 415,000 BTC (approximately $1.17 billion) since September 1st without trading or using their coins as collateral. This accumulation, occurring during a period of sluggish price movement, suggests the possibility of Bitcoin reaching a $30,000 market value.
Historically, October has been a favorable month for Bitcoin's price performance, and this trend seems to be continuing with Bitcoin's recent jump above $28,400, resulting in nearly 10% weekly gains and the liquidation of over $97 million in BTC shorts over the past 24 hours. Experts anticipate the rally to persist throughout October, citing significant buying flows and speculation surrounding the approval of BlackRock Inc.'s Bitcoin ETF proposals by the US Securities and Exchange Commission (SEC). Bitcoin may face resistance at the $30,000 level as it continues its upward trajectory.

 

[Z Forex]

EUR/USD Decline Extends Over 100 Pips Amid Strong US Dollar and Global Uncertainty
The decline in EUR/USD exceeded 100 pips on Monday, resuming the downward trend that began during Friday's American session. The pair's weakness persisted despite a brief rebound.
The primary driver behind the EUR/USD decline remains the strong US Dollar, fueled by a combination of risk-off sentiment in global markets and rising yields. The US Dollar Index (DXY) has risen for six of the last seven days, currently hovering just below 107.00. Mixed results were seen on Wall Street after a relief rally due to the US lawmakers' agreement to avoid a government shutdown. Concurrently, US yields remained strong, with the 10-year yield reaching its highest point since 2007 at 4.70%. Federal Reserve officials' remarks about the economy's resilience further contributed to the dollar's strength.
US data exceeded expectations, with the ISM Manufacturing PMI at 49 in September, surpassing the market consensus of 47.7. Upcoming reports include the JOLTS report on Tuesday and the ADP report on Wednesday. The key labor market data, Nonfarm Payrolls, is scheduled for release on Friday. Weaker data could weaken the US Dollar, while stronger data would bolster the dollar's prospects, reinforcing expectations of a Fed rate hike.
In the Eurozone, the unemployment rate dropped as expected from 6.5% to 6.4% in August. The final reading of the Manufacturing PMI for the region remained at 43.4. No significant Eurozone data is expected on Tuesday.
EUR/USD continues the selloff direction, with increasing pressure from the strength of the dollar, pushing for a breakout below the current support area around the 1.0500 region. The next levels to watch for are 1.0400, followed by 1.0200.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0400	1.0200

GBP/USD Near Recent Low Below 1.2100 as Bank of England Pauses Rate Hikes
The GBP/USD pair is trading near its recent low, below 1.2100, after the Bank of England surprised markets by pausing its interest rate hikes. This move, the first of its kind since December 2021, has weakened the British Pound (GBP) against the strong US Dollar (USD). The USD Index (DXY), which tracks the USD against other currencies, has reached its highest level since November 2022, thanks to the belief that the Federal Reserve will continue its hawkish stance and possibly raise rates again by the end of the year.
Moreover, concerns about rising borrowing costs and a generally weaker risk sentiment have boosted the USD's safe-haven status, putting pressure on the GBP/USD pair. There are no significant UK economic releases on the horizon, leaving the pair sensitive to USD dynamics, including the upcoming US JOLTS Job Openings data and the US NFP report due later in the week.
GBP/USD continues to experience selling pressure, finding support at the 1.2100 level. The bearish outlook persists and could potentially drive the price towards the historical level of 1.1800, a level not seen since March 23 of this year.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2400	1.2290	1.2200	1.2110	1.2000	1.1900

USD/JPY Approaches 11-Month Peak as BoJ Maintains Loose Monetary Policy
USD/JPY is trading just below its 11-month peak at 149.80 in early European trading. The Bank of Japan (BoJ) recently carried out an unscheduled bond purchase, reaffirming its commitment to a loose monetary policy to control rising yields in Japanese government bonds.
BoJ Governor Kazuo Ueda emphasized the central bank's readiness to implement further easing measures if necessary, clarifying misconceptions about a "quiet exit" from monetary easing.
The US Dollar Index (DXY) stands at 107.10, an 11-month high, driven by rising US Treasury yields, which have reached their highest level since 2007 at 4.68%. Concerns over the US Federal Reserve's interest rate trajectory are also boosting the USD's safe-haven appeal.
Market attention is on upcoming US employment data, including the ADP report on Wednesday and Nonfarm Payrolls on Friday.
USDJPY's bullish momentum continues stronger with the pair close to touching the critical level at 150. The intervention possibility may lead to a selloff after touching this historical level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Prices Extend 7-Day Decline to Reach 7-Month Low
Gold prices have continued their seven-day downward trend, hitting a low of $1,820, the lowest since March 9. This decline is primarily attributed to the Federal Reserve's hawkish stance on interest rates, which has driven US Treasury bond yields to historic highs and strengthened the US Dollar. Cleveland Fed President Loretta Mester's comments about inflation risks further solidified expectations of rate hikes, leading investors to favor the US Dollar over gold.
Despite a generally weaker risk sentiment in the market, which usually supports gold's safe status, the precious metal failed to find support. Mixed Chinese PMI data and the passage of a US stopgap funding bill had only a short-lived impact, as concerns about a deeper economic downturn dominated.
Gold continues the selloff and goes further toward the 1800 next strong support level. Yields and the dollar continue up after some correction which may lead to more selloff on gold.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1971	1950	1825	1800	1760	1725

 

[Z Forex]

The US Dollar Remains Strong with Positive Data and Cautious Market Sentiment
The US Dollar remains strong, supported by positive US data and cautious market sentiment. The EUR/USD pair hit multi-month lows due to the stronger US Dollar, buoyed by strong US labor market data. The Eurozone will report wholesale inflation and retail sales data, while the US awaits ADP employment figures.
The US JOLTS Job Opening report surpassed expectations, pushing the 10-year Treasury bond yield to 4.80%, reflecting a strong economy. More job data is expected in the coming days, which could further boost the dollar's rally.
The US Dollar's strength is also fueled by market expectations of prolonged higher interest rates from the Federal Reserve and deteriorating market sentiment.
Eurozone data to be released includes the Producer Price Index, Retail Sales, and final HICP PMIs for August. Market participants believe the European Central Bank has reached its terminal rate.
In the Eurozone, the unemployment rate dropped as expected from 6.5% to 6.4% in August. The final reading of the Manufacturing PMI for the region remained at 43.4. No significant Eurozone data is expected on Tuesday.
EUR/USD is still in the bearish direction, with increasing pressure from the strength of the dollar even if the price seems muted for yesterday and today. Pushing for a breakout below the current support area around the 1.0500 region. The next levels to watch for are 1.0400, followed by 1.0200.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0400	1.0200

The GBP/USD Pair Remains Within a Narrow Range
The GBP/USD pair remains within a narrow range close to its lowest level since March, with several factors influencing its movement. The US Dollar (USD) is near a 10-month high due to expectations of more Fed rate hikes and rising US bond yields, making it a headwind for the GBP/USD pair. The Federal Reserve's hawkish stance, supported by several Fed officials advocating for at least one more rate hike by year-end, contributes to this USD strength. Additionally, strong economic data, such as the JOLTS report showing a surge in job openings, raises concerns about wage inflation and pushes US government bond yields higher.
The US fixed-income market's ongoing selloff also dampens investor appetite for riskier assets, further benefiting the USD. On the other hand, the Bank of England's surprising decision to keep rates unchanged in September continues to weigh on the British Pound (GBP), limiting any potential gains for the GBP/USD pair.
GBP/USD continues to experience selling pressure, finding support at the 1.2100 level. The bearish outlook persists and could potentially drive the price towards the historical level of 1.1800, a level not seen since March 23 of this year. The prices from yesterday and today show a neutral movement waiting for data.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2400	1.2290	1.2200	1.2110	1.2000	1.1900

Surge in Japanese and US Bond Yields Spurs USD/JPY Volatility and BOJ Speculations
On Wednesday, the 10-year Japanese Government Bond (JGB) yield reached 0.8%, its highest level since 2013. This has increased pressure on the Bank of Japan (BoJ) to manage its yield-curve cap and consider ending its negative interest rate policy. Concurrently, the US Treasury yield has risen alongside the strengthening US Dollar (USD), with the 10-year yield reaching 4.865%, its highest point since 2007.
Late Tuesday, the USD/JPY pair experienced a sharp decline of nearly 300 pips from the 150.00 level due to rumors of FX intervention by Japanese authorities. However, Japan's top currency diplomat, Masato Kanda, clarified on Wednesday that any intervention would target volatility rather than specific forex levels. He also noted that it's standard for authorities not to confirm whether they have intervened or not.
In other economic news, the number of job openings for August stood at 9.6 million, up from the previous revised figure of 8.9 million, according to the Job Openings and Labor Turnover Survey (JOLTS) on Tuesday.
Additionally, speculations about Japanese authorities intervening in the FX market continue to capture traders' attention. The upcoming US Nonfarm Payrolls data on Friday will also be closely watched by traders for potential trading opportunities in the USD/JPY pair.
USDJPY volatility increased after touching the 15.00 level as expected and a movement of 300 pips was seen. The market will continue observing any possibility of BOJ intervention. 146.5 is the next support for the pair.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Remains Under Pressure as Fed Hawkishness and Strong Dollar Persist
Gold (XAU/USD) continues to struggle and remains near a seven-month low due to several factors. The hawkish outlook from the Federal Reserve, rising US bond yields, and a strong US Dollar (USD) have all contributed to the metal's decline over the past two weeks. Investors are closely watching upcoming US economic reports, including the ADP report and ISM Services PMI, for potential trading opportunities, with a keen eye on the US NFP report on Friday.
Recent comments from Fed officials support the expectation of at least one more interest rate hike this year to combat inflation. The August JOLTS report revealed a significant increase in job openings, adding to concerns about wage inflation and the need for the Fed to continue tightening its monetary policy.
The persistent inflationary pressures might lead the Fed to maintain its hawkish stance and raise rates at its next meeting in November. This, along with political turmoil and looming recession risks, has created a risk-off environment that typically benefits safe-haven assets like gold.
Gold found support around the 1920 level where the down parallel of the down channel. A possible rebound may accrue after 7 consecutive losing days. The next resistance will be at the 1860 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1971	1960	1825	1800	1760	1725

 

[Z Forex]

Euro Maintains 1.05 Level Following Dollar Correction
The euro is attempting to maintain the 1.05 level amid a mild correction phase following recent pressures. Yesterday's labor data, a precursor to the upcoming new jobs data, showed a significant pullback, acting as a catalyst and curbing the US dollar's strong momentum.
Meanwhile, US debt securities saw a slight decline in yields, but this isn't sufficient to trigger a significant shift in the current environment. President Lagarde's recent speech reiterated the importance of keeping key interest rates at their current levels to achieve the European Central Bank's inflation targets.
In the near future, we are not anticipating any major developments from the European Central Bank, as attention has shifted to the Federal Reserve's intentions. The exchange rate remains sensitive to the Fed's reasoning.
Today's focus remains on tomorrow's announcement of US unemployment and new jobs data, which traditionally generates intense volatility and can alter the exchange rate picture significantly if there are surprises.
Additionally, the market keeps a close eye on US weekly initial job claims, especially during the afternoon.
The recent strengthening of the dollar, driven by the divergent pace of the US economy, high US government debt yields, and international stock market turmoil, experienced a minor correction, as anticipated.
EUR/USD keeps the bearish outlook, and the actual correction is still limited and doesn’t confirm any reversal. Pushing for a breakout below the current support area around the 1.0500 region. The next levels to watch for are 1.0400, followed by 1.0200, and if a reversal is confirmed, the next resistance area will be at 1.0600.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0400	1.0200

Sterling's Recovery Halted by UK Economic Challenges
The British Pound (GBP) has been on the road to recovery thanks to increased demand for assets with higher risk, but its ability to strengthen further is limited. This limitation is due to the impending slowdown in the United Kingdom's economy, which is being impacted by factors such as fragile economic activities, potential inflationary shocks, and weakening demand.
Even though there has been an improvement in the UK Services PMI, economic data still indicates a contraction as it remains below the critical 50.0 threshold. The UK economy is struggling to mitigate the effects of rising interest rates by the Bank of England (BoE), increasing oil prices, and supply chain disruptions stemming from the Russia-Ukraine conflict.
GBP/USD is struggling to make a comeback as the dollar weakness is helping but the outlook is still bearish. The bearish outlook persists and could potentially drive the price towards the historical level of 1.1800, a level not seen since March 23 of this year. The price from yesterday and today shows a neutral movement waiting for data.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2400	1.2290	1.2200	1.2110	1.2000	1.1900

USD/JPY Faces Selling Pressure Amidst Speculation and Economic Data
The USD/JPY pair faced selling pressure and dropped below 148.00 during the Asian session, marking the second negative move in three days. Speculation about Japanese authorities intervening in the FX market and the practice of Gotobi payments contributed to this decline. The US Dollar retreated from an 11-month high and added to the downward pressure on USD/JPY due to disappointing US ADP data and a moderation in the US services sector, raising doubts about further Fed rate hikes. However, some caution is advised as Fed officials have supported further policy tightening, and markets expect higher rates, potentially supporting US bond yields and the Greenback. Investors are also awaiting the release of the NFP report on Friday. Weekly Initial Jobless Claims data and US bond yields may provide short-term trading opportunities.
USDJPY volatility increased after the touching the 15.00 level as expected and a movement of 300 pips was seen. The market will continue observing any possibility of BOJ intervention. 146.5 is the next support for the pair.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Price Waits for Clarity
Gold price struggles to gain momentum despite a weaker USD and lower US bond yields. Traders remain cautious ahead of the US NFP report on Friday.
The price of gold (XAU/USD) made a slight recovery attempt during the early European session but faced resistance near $1,830. This modest uptick followed a decline in 10-year US Treasury bond yields from a 16-year high, which led to a USD pullback. However, traders are hesitant to go bullish as they await clarity on the Federal Reserve's next move.
Recent economic reports have indicated a cooling US labor market and a moderation in the services sector, which may influence the Fed's rate hike decisions. Still, solid economic growth expectations for Q3 and comments from Fed officials hinting at further policy tightening have kept US bond yields elevated. This has limited the USD's decline and, consequently, capped gold's upside potential.
Traders are also staying on the sidelines ahead of the US NFP report on Friday, which will impact Fed rate hike expectations and USD demand. Additionally, the US Weekly Initial Jobless Claims data will be monitored for short-term opportunities later on Thursday.
From a technical standpoint, gold has been hovering around the 1820 area for the second day, awaiting direction that seems like it will not come until tomorrow after the NFP data. Additionally, a further selloff of the dollar and a rebound in yields could provide support.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1971	1960	1825	1800	1760	1725

 

[Z Forex]

EURUSD

The Focus on US Nonfarm Payrolls: September Expectations and Market Impact
US Nonfarm Payrolls for September are expected to increase by 170K, slightly lower than July's 187K. This data release is significant for the US economy and financial markets. It's anticipated to bring increased volatility to the US Dollar, especially when combined with Average Hourly Earnings data. The Unemployment Rate is also projected to dip slightly to 3.7% in September.
The recent unexpected rise in US job openings to 9.610 million in August has reinforced expectations of a Fed interest rate hike this quarter, reflecting a tight labor market. This supports the notion of the Fed continuing to tighten monetary policy.
Following the September policy meeting, some Fed policymakers endorsed the idea of "higher rates for longer" due to the US economy's resilience. This led to the US Dollar Index hitting an 11-month high above 107.00 and US Treasury bond yields nearing 16-year highs.
However, the odds of a November Fed rate hike decreased from 31% to 23% following disappointing US labor market data, resulting in a correction in the US Dollar and bond yields.
Nonfarm Payrolls play a pivotal role in the US jobs report, influencing Federal Reserve policy decisions by assessing progress towards full employment and 2% inflation. These figures tend to correlate positively with the US Dollar and have a negative correlation with gold prices due to the impact on interest rates and the strength of the USD. Nevertheless, market reactions can be unpredictable, influenced by other components of the jobs report in exceptional circumstances like major economic crises.
EUR/USD is currently in an accumulation phase, possibly awaiting a rebound today. If a reversal is confirmed, the next resistance area will be at 1.0600. In the event of a breakdown, the next support level will be at 1.0400.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0400	1.0200

GBPUSD

The Pound's Challenge During Economic Uncertainty
The Pound Sterling (GBP) is facing challenges as it hovers around 1.2196 due to uncertainty regarding the UK's economic outlook. September's PMI data indicated vulnerabilities in the UK economy, with firms hesitating to use their full capacity and reducing hiring due to higher interest rates imposed by the Bank of England (BoE), which have dampened demand.
Investors are not expecting a swift recovery in UK demand as the BoE plans to maintain higher interest rates for an extended period to ensure price stability. BoE Deputy Governor Ben Broadbent predicts that inflation will decrease to 2% within two years, as the restrictive monetary policy has negatively affected the labor market and economic prospects.
GBP/USD is experiencing a similar price accumulation, with direction pending confirmation from NFP data. The next resistance level to watch is at 1.2300, and the support level is at 1.0050.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2400	1.2300	1.2200	1.2110	1.2000	1.1900

USDJPY

USD/JPY Trading Higher with the Speculation on BoJ Policy Shift
USD/JPY is trading higher at 148.90, supported by a rebound in the US Dollar and improved US Treasury yields.
Former Fed Vice Chair Clarida anticipates the Bank of Japan (BoJ) adjusting its policy rate to 0% by early 2024, signaling a shift in the BoJ's approach under new leadership. Speculation about Japanese intervention in the foreign exchange market could continue to affect USD/JPY.
BoJ Governor Kazuo Ueda emphasizes the stimulative impact of the current policy framework.
US Treasury yields remain near multi-year highs, with the 10-year yield above 4.70%, amid caution due to the Fed's hawkish stance on interest rates. US Initial Jobless Claims rise to 207K, slightly surpassing expectations. US Challenger Job Cuts decreased significantly to 47.457K in September.
Upcoming US Nonfarm Payrolls and Average Hourly Earnings data may impact the USD and bond market volatility.
USDJPY continues hovering around the 150.00 area with a small correction. The pair wait for direction from today's data or an intervention from BOJ to help. The next support level is at 146.80 followed by 144.80.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

XAUUSD

Gold Prices Consolidate Ahead of US Nonfarm Payrolls Report
Gold prices struggled to gain traction as they reached $1,825 on Friday, facing headwinds from expectations of more Fed rate hikes in 2023, rising US bond yields, and a strong USD. Traders are eagerly awaiting the release of the US Nonfarm Payrolls (NFP) report, which will likely provide a new direction for gold.
The NFP report is crucial for shaping expectations about the Fed's future rate-hike decisions. The Fed's hawkish stance, supported by robust US economic data, continues to push US bond yields higher, which, in turn, bolsters the US Dollar and limits gold's gains.
Market participants believe the Fed will maintain its hawkish stance due to strong economic data. If the NFP report shows further job growth, it could lead to higher wages and inflation, potentially prompting the Fed to keep rates elevated. This scenario would favor the USD and weigh on gold prices.
From a technical standpoint, the gold price action appears subdued, as it is consolidating in preparation for a potential reversal after reaching a significant historical level. The next resistance level is at 1860-50.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1971	1960	1825	1800	1760	1725

 

[Z Forex]

EUR/USD Weakens with USD Strength and Central Bank Speculations
The euro weakened against the US Dollar, with EUR/USD dropping to around 1.0530 after three consecutive sessions of gains. This comes as the USD Index (DXY) regained strength, reaching 106.30 due to global risk-off sentiment at the start of the week.
Investors anticipate that the Federal Reserve (Fed) will maintain current interest rates for the rest of the year, while there is speculation about the European Central Bank (ECB) pausing its policy despite inflation surpassing its target and concerns about a potential recession or stagflation in Europe.
In Germany, Industrial Production contracted by 0.2% in August.
The euro's recent weakness is attributed to several factors, including the expectation of central bank actions and economic data. Strong economic data and a positive Trade Balance can boost the euro, while weak data can lead to its decline.
EUR/USD is currently in an accumulation phase, possibly awaiting a rebound. If a reversal is confirmed, the next resistance area will be at 1.0600. In the event of a breakdown, the next support level will be at 1.0400.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0400	1.0200

GBP/USD Faces Sell-Off Due to Israel-Hamas Conflict
The Pound Sterling (GBP) faced a sell-off due to the Israel-Hamas conflict, causing a drop in the GBP/USD pair. The Federal Reserve's expected interest rate hike and the Bank of England's reluctance to change interest rates to avoid a UK recession added to the negative sentiment.
The UK's economic prospects are weakening as inflation remains high, leading to reduced demand and labor demand. The Bank of England plans to maintain high-interest rates until inflation reaches 2%, contributing to the vulnerability of the situation.
In addition to the Israel-Hamas conflict, the global market mood has been downbeat.
Higher interest rates have negatively affected the UK's Manufacturing and Construction PMI, with the Construction PMI falling to 45.0 in September. Investors are also keeping an eye on the UK's Financial Policy Committee (FPC) meeting minutes and factor activity data for August.
GBP/USD is experiencing a similar price accumulation as the dollar will be dictating direction. The next resistance level to watch is at 1.2300, and the support level is at 1.0050.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2400	1.2300	1.2200	1.2110	1.2000	1.1900

USD/JPY Faces Challenges with Geopolitical Tensions
The USD/JPY pair had a challenging start to the week, opening with a bearish gap and struggling to maintain positive momentum. Geopolitical tensions in the Middle East favored the Japanese Yen (JPY), putting downward pressure on the pair. The US Dollar (USD) also underperformed, failing to provide support due to concerns about potential intervention.
Over the weekend, conflict escalated in the Middle East as Hamas initiated attacks on Israeli towns, leading to Israeli airstrikes and a declaration of war against Gaza. This negatively impacted global risk sentiment, causing investors to seek refuge in the JPY. The USD's lackluster performance further contributed to the USD/JPY's difficulties.
Although the US Non-Farm Payrolls (NFP) data for September showed strong job growth, wage growth remained moderate, which eased inflation concerns and limited enthusiasm for the USD against the JPY. Traders awaited the release of the FOMC monetary policy meeting minutes and US consumer inflation figures later in the week.
Speculation about Japanese intervention in the foreign exchange market to support the JPY acted as a ceiling on USD/JPY gains. While there were suggestions of possible intervention, some believed it unlikely given current economic fundamentals.
Given this mixed backdrop, caution was advised for traders, as the USD/JPY pair could remain in a consolidative phase in the absence of significant market-moving economic data on Monday.
USDJPY continues hovering around the 150.00 area with a minor correction. The next support level is at 146.80, followed by 144.80.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Prices Rally to $1,850
Gold prices have surged to around $1,850 per troy ounce, primarily due to increasing geopolitical tensions, notably the ongoing Palestine-Israel conflict. Investors turn to gold during such uncertainties. The US Dollar Index (DXY) has rebounded to 106.20, thanks to robust US Nonfarm Payrolls data, revealing a significant job increase of 336,000 in September, although Average Hourly Earnings slightly fell short of expectations at 0.2%, with an annual decrease of 4.2%.
US Treasury yields have risen, reaching 4.80%, reflecting expectations of prolonged higher interest rates by the Federal Reserve, nearing levels not seen since 2007.
Investors focus shifts to the upcoming International Monetary Fund (IMF) meeting, where strategies for stabilizing exchange rates and promoting development will be discussed. Additionally, the US Core Producer Price Index, expected later in the week, will provide crucial insights into inflation trends and the US economic landscape. These factors collectively shape the current global economic landscape, impacting various financial markets.
From a technical standpoint, gold worked as a safe haven and reached the 1850 area. The next resistance will be at the 1875 level while support will always be at 1810.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1985	1975	1850	18100	1760	1725

.

 

[Z Forex]

The Palestinian-Israeli War Had a Significant Impact on Global Financial Markets, Causing Them to Experience Turbulence And Uncertainty

Yesterday, the macroeconomic calendar in the market remained calm. However, the statements made by Federal Reserve (Fed) authorities Logan, Barr, and Jefferson were carefully monitored. Fed official Logan's comments on the rising bond yields attracted significant attention. Logan pointed out that the increasing U.S. bond yields might facilitate the process of tightening monetary policy, potentially eliminating the need for additional interest rate hikes by the Fed. Furthermore, Logan emphasized the current high levels of inflation, underscoring the influence of a robust labor market on inflation dynamics. He suggested that to reach the Fed's 2% inflation target, it is compulsory to maintain a course of tightening policies.

On the other hand, on Saturday, Hamas forces launched a surprise attack from the Gaza Strip into southern Israel, resulting in over 700 Israeli casualties, predominantly civilians. Around 260 people attending a music festival near Gaza's northern border were killed by Hamas militants. In retaliation, approximately 400 Palestinians lost their lives in Israeli counterattacks. Israel reclaimed control of areas previously held by Hamas and recaptured numerous territories. A protracted military operation in Gaza, potentially lasting for months, is anticipated.

Following the rise in tension in the Middle East, oil prices rose by up to 5%, and gained some of last week's losses. With the war risk returning to the markets, the barrel price of WTI crude oil exceeded 86 dollars. The price of Brent crude oil increased by 4% and found buyers at $88.30. It is worth reminding that Brent and WTI lost value last week due to the slowdown in global growth and the expectation of higher interest rates. Additionally, the yellow metal (gold), reacting with an increase to the possible war news, regained last week's losses and closed Monday at 1961 levels per ounce.

Today, in the U.S., the NFIB small business optimism data will be followed. It should be remembered that the August data was at 91.3 with a monthly decrease of 0.6 points.

EURUSD Responds to Dollar Index and Yields

Attention is still focused on the Middle East. Thus, the Dollar Index (DXY) had a positive start to the week. In other words, the Palestinian-Israeli war is affecting market sentiment.

Yesterday, the euro touched the lowest level of 1.0550 due to the recovery in the DXY. However, as the market stabilized and U.S. yields kept falling, the momentum turned in EUR’s favor and closed the day 1.0566 level.

Today, the parity is hovering around the 1.0562 level. On the upside, the parity could encounter resistance at the 1.0600 level. If that level is broken, we will follow 1.0650 as a firmer resistance.

If it moves downward, If the level is decisively broken, it could push the pair down to around 1.0500, and then possibly to 1.0450, which is close to last week's low at 1.0448.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0700	1.0650	1.0600	1.0500	1.0450	1.0380

Sterling Holds Steady Around 1.2200 with Limited DXY Demand

The British pound has maintained relative stability, hovering around the mid-1.2200 level. This stability can be attributed to a lack of significant demand for the US Dollar Index (DXY). In the previous trading session, the GBP exhibited a more confined trading range, fluctuating between 1.2166 and 1.2245. Notably, there seems to be a subtle upward momentum in play, albeit with a degree of caution.

Looking ahead to today's trading session, there is a possibility that the GBP may surpass the 1.2270 mark and potentially reach levels around 1.2305. However, it is less likely to breach the significant resistance point at 1.2350. For traders and investors, it's essential to keep an eye on the support levels, which currently stand at 1.2170, followed by 1.2105. These levels may provide guidance in assessing potential price movements and trading strategies in the ongoing forex market.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2350	1.2305	1.2270	1.2170	1.2105	1.2040

USD/JPY Pair Grapples with Volatility: Testing 150 Levels and Beyond


When the ultra-expansionary monetary policies of the Bank of Japan were added to the Fed interest rate, which was the highest in 22 years, the USD/JPY pair rose to 150 levels. The fear that the Central Bank of Japan would intervene, reduced the parity from 150 levels to 147.30 levels last week. Trying to regain its losses during the week, JPY closed last week at 149.20.

The pair experienced a decline on Monday, closing the day at 148.5 levels, because of the war-related news impacting the markets during the weekend. Even though the EUR and GBP depreciated following the war news, the strengthening of the JPY emphasized its status as a safe-haven currency in the market.

Still, the pair remains within a trading range possible between 147.05 and 150.15.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
150.15	149.55	149.20	148.20	147.50	147.05

Gold's Rally Following Middle East Conflict: Will It Sustain Momentum?

Gold's value has been on the decline for an extended period due to the persistently high-interest rates. The September Fed meeting, seen as 'hawkish' by the markets, triggered a swift drop in gold prices. Since September 25, gold had been consistently decreasing, but it found support at the 1810 level.

However, the recent Israeli-Palestinian conflict that erupted over the weekend has once again positioned gold as a safe-haven asset. Gold has not only recovered its losses from last week but has also risen to the 1863 level. Even with the war news, the U.S. 10-year bond interest rate index remains at its highest point in the last 16 years, despite some fluctuations.

Technically, a break of the 1883 (21-day moving average) level will increase the buyer appetite and the next resistance we follow at $1903 (50-day moving average). On the downside, the initial support can be found at yesterday's low of $1845, followed by the $1833 level, which would fill the gap.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1903​	1883​	1878​	1845​	1832​	1824​

 

[Z Forex]

EUR/USD Gains Ground as Dollar Weakens
EURUSD continues to rise as the Dollar Index (DXY) weakens. The European Central Bank (ECB) is expected to pause the interest rate tightening cycle. Also, DXY is losing momentum due to the multiple dovish statements from Fed officials.
Today, the parity is hovering around the 1.06053 level (21-daily moving average). On the upside, the parity could encounter resistance at the 1.0630 level. If that level is broken, we will follow 1.0690 as a firmer resistance.
If it moves downward, If the level is decisively broken, it could push the pair down to around 1.0540, and then possibly to 1.0500, which is the psychological level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0740	1.0690	1.0630	1.0540	1.0500	1.0450

Pound Holds Near 1.2300 as Dollar Weakens Due to Falling Bond Yields
The pound is maintaining its gains just below 1.2300, after stepping back from a nearly three-week high of 1.2304 level. The DXY is weakened by declining bond yields and a positive market sentiment, which is helping the pair. Traders are now keeping an eye on the US PPI data and the release of FOMC meeting minutes for potential market-moving cues.
Today, there's a possibility that the GBP could surpass 1.2330 and test the 1.2365 level, but it's unlikely to reach the major resistance at 1.2425. Support levels are at 1.2200 and then 1.2175.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2425	1.2365	1.2330	1.2200	1.2175	1.2140

USD/JPY Rebounds as Market Sentiment Improves
USD/JPY is going up for two days in a row, trading around 148.80 on Wednesday in Asia. This is because the pair rebounded in the previous session, influenced by positive market sentiment related to the Middle East conflict.
The pair is hovering around the 148.85 level and still 148.45 level (21-daily simple moving average) could act as a support. If that level is broken, we are following yesterday’s low level at 148.15. On the upside, the 149.00/20 region is still working as a resistance, next 149.55 level.
Traders should be aware that in the past, the Bank of Japan (BoJ) has shown interest in the USD/JPY exchange rate when it approaches the significant level of 150.00. The BoJ has used this level as a potential trigger for foreign exchange market interventions to safeguard the value of the yen.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
150.15	149.55	149.10	148.45	148.15	147.30

Gold Rises as Fed Rate Hike Expectations Diminish
The recent more cautious stance taken by US Federal Reserve (Fed) officials has led traders to reduce their expectations for an additional interest rate hike by the most influential central bank in the world before the end of the year. The likelihood of a Fed rate increase in November is now just 13%. Thus, gold continues to rise today and is hovering around the $1865 level.
Now, gold price is so close to overbought condition in terms of the RSI indicator, but the bullish momentum will continue ahead of the US PPI and Fed minutes. Technically, a break of the 1881 (21-day simple moving average) level will increase the buyer appetite and the next resistance we follow at $1902 (50-day simple moving average). On the downwards, yesterday’s low level of $1853 will be the first support, the next $1845.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1902	1881	1872	1853	1845	1833

 

[Z Forex]

Euro Trades Stably Near 1.06 Awaiting US Consumer Inflation Data
The euro is currently striving to stay above 1.06, exhibiting stability in a tight trading range while awaiting vital US Consumer Inflation updates. The Federal Reserve's recent meeting minutes didn't bring any surprises, leaving uncertainty about the possibility of a 25-point rate hike. As expected, the currency pair remained directionless near 1.06, aligning with previous predictions of consolidation after a dip to 1.0448.
Although the euro made modest gains, the technical outlook suggests a substantial uptrend is challenging without new macroeconomic data. Today's US inflation report is crucial, potentially introducing significant volatility. The economic agenda also includes US weekly initial jobless claims, closely watched for their impact on the economy.
Given these impending announcements, a cautious approach is advisable, and maintaining long euro positions may not be prudent in this uncertain environment.
EUR/USD is currently in an accumulation phase waiting for a possible reversal. If a reversal is confirmed, the next resistance area will be at 1.0750 while the next support level will be at 1.0500.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0830	1.0750	1.0650	1.0500	1.0400	1.0200

Pound Maintains Bullish Stance Amid Weak UK Factory Data
The Pound Sterling (GBP) continues to hold its ground in spite of weak UK factory data for August. The GBP/USD pair remains bullish despite the Office for National Statistics (ONS) reporting that UK factory data contracted for the second consecutive month. This contraction was driven by UK firms operating at reduced capacity to enhance efficiency, which involved cutting inventory backlogs and labor forces due to declining demand.
This slowdown in demand and overall output poses concerns for Bank of England (BoE) policymakers as they prepare for the upcoming interest rate decision in November. While some, like BoE's Katherine Mann, lean towards tightening policy to curb inflation and bring it down to 2%, Swati Dhingra from the central bank supports a rate cut if the growth rate falls beyond expectations.
Concerns about potential inflation rebounds persist due to geopolitical tensions in the Middle East, which could keep the oil market tight until 2024. Additionally, the UK faces energy shortages due to supply chain disruptions, which could exacerbate headline inflation and challenge the government's commitment to halve it to 5.2%.
GBP/USD continued its advance toward the 1.2300 target and now the price facing some resistance at that level. A comeback will take the price toward the 1.2200 support level and a breakout up will take the price to the 1.2450 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2600	1.2450	1.2300	1.2200	1.2100	1.2000

Divergent Fed Views Impact USD/JPY as FOMC Minutes Awaited
The USD/JPY pair ended a two-day winning streak, trading around 149.00 in the Asian session, amid concerns over the Federal Reserve's rate-hike plans. Fed Governor Christopher Waller has expressed caution, suggesting that market tightening might suffice without immediate action. In contrast, Fed Governor Michelle Bowman leans toward more rate hikes, citing persistent inflation. The Federal Open Market Committee (FOMC) minutes reveal a divergence in views, emphasizing data-driven decisions.
The US Producer Price Index (PPI) rose in September, exceeding expectations at 2.2%. Attention now turns to the Consumer Price Index (CPI) release, forecasting a potential drop from 3.7% to 3.6%, and the upcoming Jobless Claims report.
The US Dollar Index (DXY) faces challenges around 105.50 due to subdued US Treasury yields. The Japanese Yen (JPY) weakens, as the Bank of Japan (BoJ) maintains an ultra-easy monetary policy, focusing on wage growth and inflation control. BoJ board member Asahi Noguchi supports flexibility under Yield Curve Control (YCC) to balance economic recovery and inflation management amidst rising inflation expectations.
USDJPY continues hovering around the 150.00 area with a small correction. The next support level is at 146.80 followed by the 144.80. A possible reversal is the most awaited scenario.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Geopolitical Tensions and Weaker Dollar Propel Gold to Two-Week Highs
The price of gold has rebounded from a seven-month low, reaching a two-week high amid geopolitical tensions, declining bond yields, and a weaker US dollar. The recent surge in gold's value is driven by Middle East conflicts, making it a preferred safe-haven asset, coupled with the depreciation of the US dollar. Falling global bond yields are also supporting the non-yielding precious metal.
The recent recovery has allowed gold to recoup over 30% of its September losses, despite a generally positive tone in equity markets. Speculations about the Federal Reserve nearing the end of its rate-hiking cycle suggest an upward trajectory for gold. However, traders are awaiting the US Consumer Price Index (CPI) report later in the North American session to gain fresh insights into the Fed's rate-hike path.
A decrease in US inflationary pressures could solidify expectations of the Fed maintaining its current policies in November, potentially leading to a rate cut in Q2 2024. This scenario could further weaken the US dollar and drive demand for gold. Conversely, a strong CPI report could keep the door open for another Fed rate hike by year-end, causing gold bulls to reconsider their positions.
Gold continues its recovery and tries to break the 1875-80 resistance level going toward the 1900 target. Today's data will dictate the direction.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1920	1900	1880	1875	1855	1830

 

[Z Forex]

US INDICES:

S&P 500 and Nasdaq Futures Gain 0.4% as Inflation Data Awaited

S&P 500 and Nasdaq 100 futures gained nearly 0.4% each.

The consumer price report for September will be released Thursday morning. Economists surveyed by Dow Jones are forecasting a 0.3% month-over-month increase for September and a 3.6% rise from the prior year. Investors believe that the strength of inflation indicated in the report will play a key part in whether the Federal Reserve decides to maintain or raise interest rates at its two-day meeting beginning Oct. 31.

The data comes following a stronger-than-expected producer price index for September.

Atlanta Fed president Raphael Bostic and Boston Fed president Susan Collins will be giving remarks Thursday afternoon, which could give Wall Street more insight into the central bank’s stance.

On a daily basis, a possible descending triangle is forming. The support level is at 14,500, while the resistance level is at 15,300, where the median line of the long bullish channel and the downtrend line coincide. Whether there is a bounce from this level or a breakout will depend on current macroeconomic developments and the pricing of upcoming meetings.

USOIL

Oil Prices Rise Following Growing Concerns Over Israel-Palestine Conflict

Oil prices are showing a gradual increase on Thursday, driven by concerns highlighted by the IEA regarding heightened market risks due to the escalating Israel-Palestine conflict. Additionally, OPEC producer Saudi Arabia has committed to maintaining market stability, aiming to prevent supply disruptions resulting from the Israel-Palestinian war.

According to the EIA, global oil demand is projected to rise by 3% to 10% from 2022 to 2030 and by 6% to 42% from 2022 to 2050. The most significant growth is anticipated in the scenario of high economic expansion, as outlined in the EIA's report.

Volatility is accelerating in the oil price and direction will be clearer after the geopolitical tensions calm down. 83 as support and 87 as resistance are right now in the price range.

Crypto

Cryptocurrencies Experience Sixth Consecutive Day of Losses as Bitcoin Falls Below $26,750

Bitcoin and various cryptocurrencies faced a sixth consecutive day of losses on Thursday, despite other risk-sensitive assets performing well. This marked a reversal from a recent bullish trend as cryptos returned to their usual trading ranges.

In the past 24 hours, Bitcoin's price dropped by 1.5% to fall below $26,750, reaching its lowest point this month after nearing $28,000 over the weekend.

Returning to the $26,000 range is concerning as Bitcoin had previously stagnated in this zone for over a month due to low volatility and waning investor interest. In late September, there was hope for a bullish streak pushing towards the psychologically important $30,000 level.

Interestingly, Bitcoin's performance has diverged from the stock market, which saw four consecutive days of gains in the Dow Jones Industrial Average and S&P 500. Some suggest crypto traders are becoming cautious due to potential conflicts in the Middle East affecting demand for high-risk assets, or it could be that Bitcoin has lost its allure.

The release of U.S. consumer-price index (CPI) data on Thursday may push Bitcoin above $27,000 or anchor it around $26,000, despite recent macroeconomic developments. Hopes of the Federal Reserve not raising interest rates have boosted stocks but had limited impact on cryptocurrencies, which often decline when borrowing costs rise.

Bitcoin continues hovering around the resistance level at the 100 and 200MA on the daily chart at the 28070 level. The price is forming a range indicating uncertainty. 25000 and 28000 are the support resistance of the actual range.

 

[Z Forex]

EUR/USD Resilient Despite Positive US Data as Concerns of Economic Slowdown Weigh
EUR/USD displays resilience after a prior losing session, spurred by positive US economic data. Headline inflation exceeded expectations at 3.7%, while jobless claims remained slightly below forecasts. This data has reignited speculation of a Fed interest rate hike.
The euro's outlook is more cautious due to concerns about a potential economic slowdown and the possibility of a recession, dampening prospects for further ECB rate hikes. Investors will keep an eye on the US Michigan Consumer Sentiment Index and ECB President Christine Lagarde's comments for market cues.
EUR/USD is currently in an accumulation phase waiting for a possible reversal. If a reversal is confirmed, the next resistance area will be at 1.0750 while the next support level will be at 1.0500.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.0830	1.0750	1.0650	1.0500	1.0400	1.0200

GBP/USD Rebounds Despite Weak UK Data
The GBP/USD pair rebounded from losses driven by positive US economic data. US inflation, with an annual growth rate of 3.7%, exceeded expectations in September, while Initial Jobless Claims for the week ending October 6 showed slight improvement. This upbeat US data has raised questions about the Federal Reserve's monetary policy.
Conversely, the Pound Sterling faced pressure due to weak UK data. August's Manufacturing and Industrial Production figures fell short, with manufacturing production down 0.8% and industrial production declining by 0.7%. Although August's UK Gross Domestic Product (GDP) met expectations, the previous month was revised downward.
The Bank of England (BoE) lowered its growth forecast, hinting at limited rate increases. Market watchers are awaiting the US Michigan Consumer Sentiment Index and insights from BoE Governor Andrew Bailey's speech to understand the economic landscape in both countries.
Similar to EUR/USD, GBP/USD has retraced from its resistance and is currently stabilizing, entering an accumulation phase while awaiting a possible reversal. The next target if a breakout happens is at 1.2450.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2600	1.2450	1.2300	1.2200	1.2100	1.2000

USD/JPY Bulls Near 150.00 Following Inflation Concerns and Economic Data Disappointments
The USD/JPY pair continued its bullish recovery, nearing the 150.00 level, as the US Dollar strengthened amid risk-off sentiment due to concerns about higher US CPI inflation. This surge was driven by worries that the Federal Reserve might maintain elevated interest rates.
Currently at 149.83, the 150.00 level has the Bank of Japan's attention due to past FX interventions. Japan's economic data disappointed, with September's PPI falling by -0.3% instead of the expected 0.1% increase. Machinery Orders for August improved to a -0.5% decline from -1.1% but remained below the projected 0.4%.
In contrast, the US saw an annual CPI inflation rate of 3.7% for September, exceeding the 3.6% consensus. Initial Jobless Claims were slightly lower at 209K compared to the forecasted 210K.
These positive economic indicators and persistent inflation have raised concerns about the Fed maintaining higher interest rates longer than anticipated.
USDJPY continues hovering around the 150.00 area with a small correction. The next support level is at 146.80 followed by the 144.80. A possible reversal is the most awaited scenario.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
155.00	152.70	151.50	148.00	146.50	146.00

Gold Prices Surge to Two-Week High Amid Geopolitical Tensions and Weak Dollar
Gold price has rebounded from a seven-month low, reaching a two-week high amid geopolitical tensions, declining bond yields, and a weaker US dollar. The recent surge in gold's value is driven by Middle East conflicts, making it a preferred safe-haven asset, coupled with the depreciation of the US dollar. Falling global bond yields are also supporting the non-yielding precious metal.
The recent recovery has allowed gold to recoup over 30% of its September losses, despite a generally positive tone in equity markets. Speculations about the Federal Reserve nearing the end of its rate-hiking cycle suggest an upward trajectory for gold. However, traders are awaiting the US Consumer Price Index (CPI) report later in the North American session to gain fresh insights into the Fed's rate-hike path.
A decrease in US inflationary pressures could solidify expectations of the Fed maintaining its current policies in November, potentially leading to a rate cut in Q2 2024. This scenario could further weaken the US dollar and drive demand for gold. Conversely, a strong CPI report could keep the door open for another Fed rate hike by year-end, causing gold bulls to reconsider their positions.
Gold continues its recovery and is attempting to break the 1875-1880 resistance level, moving towards the 1900 target due to weakness in the dollar today.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1920	1900	1880	1875	1855	1830