• U.S. government fiscal sustainability tops the list of financial system risks cited in the Fed survey of market contacts for the semi-annual Financial Stability Report.
• Persistent inflation dropped to No. 5 on the risks list from No. 1 in the prior survey, now tied with global trade risks.
• Trade issues, last cited as a salient risk in May 2020, were previously a top concern during Trump’s first term in 2019.
• Middle East tensions, policy uncertainty, and a potential U.S. recession are among the top-cited risks in the Fed survey.
• The NY Fed surveyed 24 market contacts from August to October on risks to U.S. financial stability.
• Asset valuation pressures are „elevated,“ though corporate bond spreads remain low; business and household debt risks are considered „moderate.“
• Liquidity conditions in the Treasury cash market appear challenged and could amplify shocks.
• Financial sector leverage vulnerabilities remain notable, with hedge fund leverage near the highest levels since 2013.
• Stablecoin assets rose to nearly $170 billion by early November, with the potential for rapid scaling and vulnerability to runs.

This article was written by Greg Michalowski at www.forexlive.com.

• Major indices close higher for the trading week by the Russell 2000
• Baker Hughes oil rigs up 1 Gas rigs down -2
• European shares close higher despite weak data today
• Attack the currency trend: The EURUSD has been stepping lower with more selling today
• What is the latest tilt for US Treasury Secretary?
• University of Michigan consumer sentiment final for November 71.8 versus 73.7 estimate
• Tech giants stumble: Communication services slump amid mixed market signals
• S&P global manufacturing PMI 48.8 versus 48.8 estimate. Services 57.0 versus 55.2 estimate
• ECBs Nagel (Hawk): PMI data confirms that Germany is stagnating
• ECBs Villeroy: ECB is achieving a soft landing
• Canada retail sales for September 0.4% vs 0.4% estimate
• Canada October new housing price index MoM -0.4% vs 0.1% expected
• SNB chairman Schlegel: Switzerland needs flexible inflation target, as it currently has
• ForexLive European FX news wrap: Poor PMI data weighs on euro, pound

Markets:

• Gold up $37.21 or 1.4% $2706.61
• US 10-year yield 4.414%, -1 point basis points
• US 2-year yield 4.377%, +220 basis points
• WTI crude oil up $1.08 or 1.53% $71.19
• S&P 500 rose . For the week the index rose 1.52%
• NASDAQ rose . For the week the index rose 1.62%
• Russell 2000 rose . For the week the index rose 4.3079%
• Dow rose . For the week the index rose 1.76%
• European shares moved higher with the UK FTSE 100 rising 1.38% and German DAX rising 0.8% leading the way. France’s CAC rose 0.58% was the weakest performer.

The US dollar rose against all the major currency pairs, but was mixed for the week with the USD falling vs the CAD and the NZD.

• EUR, +0.58%. For the week, the US dollar rose by 1.18%.
• JPY +0.20%. For the week the US dollar rose 0.35%
• GBP, +0.47%. For the week the US dollar rose 0.71%
• CHF +0.87%. For the week the US dollar rose 0.74%.
• CAD +0.08%. The week the US dollar fell -0.70%
• AUD +0.25%. For the week the US dollar fell is 0.58%
• NZD +0.53%. For the week, the US dollar rose 0.54%
• DXY 0.57%. For the week the dollar index rose 0.0%

Fundamentally, the US data today was mixed with the S&P global PMI manufacturing and services indices higher.

• For Manufacturing PMI, the index moved from 47.8 to 48.8
• For the services index it surged to 57.0 from 55.3 last month.

From Chris Williamson, Chief Business Economist at S&P Global Market Intelligence

The business mood has brightened in November, with confidence about the year ahead hitting a two-and-a-half year high. The prospect of lower interest rates and a more probusiness approach from the incoming administration has fueled greater optimism, in turn helping drive output and order book inflows higher in November. The rise in the headline flash PMI indicates that economic growth is accelerating in the fourth quarter, while at the same time inflationary pressures are cooling. The survey’s price gauge covering goods and services signalled only a marginal increase in prices in November, pointing to consumer inflation running well below the Fed’s 2% target.

A concern is that growth remains heavily reliant on the services economy, with manufacturing production declining at an increased rate. However, the promise of greater protectionism and tariffs has helped lift confidence in the US good producing sector, which is already feeding through to higher factory employment. Factories are meanwhile stepping up their purchases of imported inputs as they seek to front-run tariffs, putting pressure on supply chains to a degree not seen for over two years. Any further stretching of these supply lines could see prices move higher as demand outstrips supply.

Later the University of Michigan sentiment came in weaker than expectations with the index moving to 71.8 from 73.0 preliminary, but was up from 70.5 last month. Inflation readings were mixed with the one-year inflation expectations remaining study a 2.6% versus the preliminary lower than the 2.7% last month. However the five-year inflation expectations rose to 3.2% from 3.0% last month.

Canada retail sales data for September came in and is expected 0.4% for the headline number but was expected 0.9% orders. The estimate for October came in fairly solid 0.7%.

Yields were mixed today with the shorter end higher and the longer end lower flattening the yield curve

• 2-year yield 4.377%, +20 basis points
• 5-year yield 4.305%, +0.2 basis points
• 10-year yield 4.414%, -1 point basis points
• 30-year yield referred 90%, -2.3 basis points
• 2-10 year spread is down -3.6 bps at 3.9 basis points
• 2-30 year spread is also down -2.8 bps at 22.4 basis point

Bitcoin reached another record level with the price reaching a $99,800 just to hundred dollars short of Bitcoin $100K. The digital currency that never sleeps will be eying the $100K level over the weekend. For the week, the price is up $9290.

Thank you for the support this week. Adam is back on Monday from the Finance Magnate conference in London.

This article was written by Greg Michalowski at www.forexlive.com.

• Dow industrial average rose 426 points or 0.97% at 44296
• S&P index rose 20.63 points or 0.35% it 5969.34
• NASDAQ index rose 31.23 points or 0.16% at 19003.65
• Russell 2000 rose 42.65 points or 1.80% at 2406.67

For the trading week:

• Dow Industrial average rose 2.0%
• S&P index rose 1.7%
• NASDAQ index rose 1.74%
• Russell 2000 surged by 4.52%

This article was written by Greg Michalowski at www.forexlive.com.

The USD/CHF pair, after trading within a range of 0.8400 to 0.8550 through late August and October, transitioned from consolidation into a trending phase. This shift began as prices broke through key levels in a step-by-step manner, marking the transition from non-trend to trend.

Last week, the price moved above the 50% midpoint of the move down from the April high at 0.87989, and the 200 day MA at 0.88298. The price reached a target area near 0.8914 to 0.8923 and backed off into the close last Friday.

Early this week, the pair moved lower initially, breaking below the 200-day moving average at 0.88298 and reaching the 50% retracement of the decline from the April high at 0.87989, near the natural support at 0.8800. At this level, sellers turned into buyers, driving a reversal higher.

The price rebounded above the 200-day moving average midweek, retested it on Wednesday, and subsequently built momentum to the upside once again. This upward move, supported by broader dollar strength and weaker European currencies, pushed the pair above the 61.8% retracement of the April high at 0.8899 and a swing area between 0.8914 and 0.8923, which now serves as immediate support zones. Staying above 0.8900 maintains a bullish outlook, with further upside likely into the new trading week. The next major target lies around the psychological 0.9000 level.

Conversely, if the price breaks below 0.8900, along with the lower bound of the swing area at 0.8880, a move back toward the 200-day moving average at 0.88208 becomes a possibility. For now, the pair’s direction hinges on whether it can hold above these key support levels or retrace toward lower technical targets.

——————————————–

USD/CHF Technical Analysis

The USD/CHF pair transitioned from a consolidation phase to a trending phase, breaking through key levels in a step-by-step manner.

Key Levels:

• Support: 0.8900, 0.8880 (lower bound of swing area)

• Resistance: 0.9000 (psychological level)

• Lower support at the 200-day Moving Average: 0.88208 and 50% retracement at 0.87989 (all it 0.8800)

Trading Strategy:

• Staying above 0.8900 maintains a bullish outlook.

• Break below 0.8900 and 0.8880 could lead to a move toward the 200-day moving average.

• Next major target above 0.8900 is above and below 0.9000 level.

Current Situation:

The pair has built momentum to the upside, pushing above the 61.8% retracement of the April high and a swing area between 0.8914 and 0.8923. The direction now hinges on whether it can hold above key support levels.

This article was written by Greg Michalowski at www.forexlive.com.

• Oil rigs, up 1 to 479
• Natural gas rigs down -2 to 99
• Total rigs for the week down 1 to 583

This article was written by Greg Michalowski at www.forexlive.com.