• US major indices close higher for the day. S&P snaps four week losing streak
• WTI crude futures settle at $82.79
• UAW Pres Fain: UAW strike is working but not there yet
• Mortgage rates at 23 year high.
• Baker Hughes oil rig count 497 versus 502 last week. Crude oil is trading little changed
• WSJ’s Timiraos: its a weird payroll report
• European indices close higher on the day. German Dax rises over 1%
• More from ECB Knot: Would prefer a tolerance band around target rate
• US 10 year yield tests the high from earlier the week after stronger US jobs report
• ECBs Knot: We are getting on top of inflation
• Canada September employment 63.8K vs 20.0K expected
• US September non-farm payrolls +336K vs +170K expected
• The GBP is the strongest and the JPY is the weakest as the North American session begins
• Forexlive European FX news wrap: Schnabel won’t rule out more ECB rate hikes

When the US jobs report came out and showed a stronger-than-expected 336K nonfarm payroll jobs (estimate 170K) and revisions of over 100K to the prior month’s, the US dollar moved higher, yields moved higher and stocks moved lower.

However, then people started to look at things like the unemployment rate remaining at 3.8% (despite the gain in jobs), the average hourly earnings coming in at 0.2% – lower than the 0.3% expected – and the year-on-year average earnings dipping to 4.2% which was lower than pre-pandemic levels, the tone in the market started to shift. First it was a correction. Then when technical level started to be taken out in the opposite direction of the initial moves, you could hear the „uh-ohs“, and more and more stories started to explain the strong data away.

• The 10 year yield moved up to 4.887% which took out the high yield from 2 days ago at 4.884%, but started to back off of that level.
• Stocks in premarket trading started to recover some of the losses and then opened with not so bad declines
• The USD recovered some of the earlier gains but was still higher on the day

There were enough pundits who questioned some of the seasonal influences. Some started to refer back to Fed’s Daly and Bostic who implied the rising yields were the equivalent of Fed tightening, and that the Fed moves warranted a pause in policy (who knows if they knew the data?).

The next thing you know, markets start to reverse even more.

• In the US stock market, the „good data equals lower stock prices“, turned around to „good data equals higher stock prices“ i.e. Goldilocks.
• In the bond market, the inability to extend toward 5% in the 10 year became a positive. The 30 year which moved above the 5% level to a high of 5.052%, but then worked its way back down and below the 5% level.
• The USD saw target levels stall the greenbacks rise, and other broken technical levels start to be taken back.

For example,

• The EURUSD moved down to test a key target at 1.0483 and then reversed back above its 100 hour moving average and 200 hour moving averages at 1.0507 and 1.05297 respectively. As London/European traders were looking to exit, a new high was made, the price moved above the 38.2% retracement of the move down from the September 12 high at 1.05709, and extended to just short of 1.0600.
• The GBPUSD initially fell down to test the corrective low from Wednesday’s trade, the day low from Thursday’s trade both at 1.21056. The low price today reached 1.21053 and like the EURUSD, moved back above its broken 100-hour moving average (currently at 1.21326) and 200-hour moving average (currently at 1.21536). That turned sellers to buyers. The price later moved above the 38.2% retracement of the move down from the September 11 high at 1.22316. Then made a new high for the week at 1.2258. The price is closing above that level for the trading week.
• The AUDUSD fell below its 100-hour moving average of 0.6340 after the jobs report, but then rebounded back above that level and also back above its 200-hour moving average at 0.63726.
• The USDCHF moved up to test its near converged 100 and 200-hour moving averages shortly after the jobs report near 0.9166. It found willing sellers against that level in reversed down to a low for the day and week at 0.9072.
• The NZDUSD stalled its initial fall after the jobs data near the 100 hour MA at 0.5931, bounced back above its 200 hour MA at 0.59469, and extended to an intraday high at 0.6002 (just above natural resistance at 0.6000). The price is closing the day at 0.59883.

Overall, the NZD is ending the day is the strongest of the major currencies. The JPY is the weakest. The USD is down vs all the major currencies with the exception of the JPY.

In the US interest rate market, yields remain higher on the day but off the highest levels:

• 2-year yield 5.081%, +5.6 basis points
• 5-year yield 4.751%, +6.8 basis points
• 10-year yield 4.794%, +7.9 basis points
• 30-year yield 4.959%, +7.3 basis points

In the US equity markets, the major indices all close solidly higher led by the NASDAQ index. For the trading week, the S&P snapped a 4-week losing streak. The Dow industrial average was still negative on the week. The NASDAQ and the closed higher for the week:

• Dow industrial average rose 288.01 points or 0.87% at 33407.59. For the trading week the index fell -0.30%.
• S&P index rose 50.31 points or 1.18% at 4308.49. For the trading week the index gained 0.48% thanks to today’s move higher.
• NASDAQ index rose 211.50 points or 1.60% at 13431.33. For the trading week the index gained 1.6% after starting the day unchanged for the week.

Next week US CPI data be released on Thursday. Hope springs eternal that the Fed is now able to maneuver through strong employment without inflation moving higher. Time will tell, but today the market celebrated

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

The major US indices are closing higher for the day. The gains came despite strong and expected US jobs report and higher yields. Traders are hoping that the tame wage data and the unemployment rate remaining unchanged at 3.8% (expected 3.7%) will keep the Fed on hold. Next week we get key consumer price index data in the US released on Thursday.

The final numbers are showing:

• Dow industrial average rose 288.01 points or 0.87% at 33407.59
• S&P index rose 50.31 points or 1.18% at 4308.49
• NASDAQ index rose 211.50 points or 1.60% at 13431.33

For the trading week, the Dow industrial average could not erase its declines and still closed lower, but the S&P rebounded into positive territory today and snapped a 4-week losing streak. The NASDAQ index is also higher and has now risen for 2 consecutive weeks (admittedly last week’s gain was by the slimmest of 0.06%).

• Dow industrial average, -0.30%
• S&P index, +0.48%
• NASDAQ index +1.60%

Some of the big gainers today were the big cap/AI stocks:

• Adobe, +1.98%
• Nvidia, +2.41%
• Google, +1.87%
• Microsoft, +2.46%
• Meta, +3.49%
• Netflix, +2.43%

Shares of Apple rose by 1.43%, but lagged the NASDAQ index today. Amazon rose 1.59%

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

In this video, I outline the risks and targets in the USDCH as we work toward the close for the week, and the look ahead to the new trading week.

What is the bias? What are the targets? What is the risk? What did the price action today and this week tell us technically about the price action going forward?

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

In this video, I outline the risks and targets in the USDCAD as we work toward the close for the current week, and the look ahead to the new trading week starting October 9, 2023.

What is the bias? What are the targets? What is the risk? What did the price action today and this week tell us technically about the price action going forward?

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

The price of WTI crude futures are settling at $82.79. That’s up $0.48 or 0.58%. Since then the price has rallied up to $82.98.

For the week, the price is still down sharply by -8.57% currently that is the sharpest fall since March 13, 2023 week

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

• ECB’s Schnabel: If risks materialize, further rate hikes may be necessary
• Halifax says downward pressure on UK house prices likely to last into next year
• German industrial orders rebounded in August
• Italy August retail sales -0.4% vs +0.4% prior
• Mohamed El-Erian on 2 factors that makes a US recession more likely
• JPMorgan’s Marko Kolanovic is preparing for a possible 20% drop in the S&P 500

Markets:

• Gold up $1 to $1821
• US 10-year yields up 2.9 bps to 4.74%
• WTI crude oil up 18-cents to $82.48
• S&P 500 futures up 0.2%
• GBP leads, JPY lags

The news was mostly positive in Europe as German industrial orders rebounded from a dreadful July and Schnabel kept the door open to rate hikes, though the later may have only served to reinforce that it will take a surprise to jar the ECB from the sidelines.

The euro was under some pressure early in Europe as the dollar strengthened broader but it’s since turned around and is trading at the highs of the day. The pound also has some momentum in its third day of gains.

The yen is weaker though as global yields tick higher again. Perhaps the most-intriguing news is that President Biden scheduled an appearance to talk about the jobs report at 11:30 am ET. That’s the kind of thing a President would do to take a victory lap after a good report.

This article was written by Adam Button at www.forexlive.com.

It’s likely a fool’s errand to try to make sense of price action in the hour before the non-farm payrolls report but USD/JPY is at the highs of the day, up 58 pips to 149.09. It’s getting help from a 3.4 bps rise in 5-year yields to 4.71% the rest of the curve is up 2.5-3.5 bps as well.

The pair is starting to brush against some post-intervention highs but continue to run to 149.31 and those surely won’t be tested before non-farm payrolls. Afterwards, a strong jobs report would leave some room to the upside before the 150.00 level puts intervention back on the agenda.

This article was written by Adam Button at www.forexlive.com.

Despite the strength in the US data this week and
another beat in Jobless Claims
yesterday, the Nasdaq Composite didn’t sell off like we saw in the past week.
The index is hovering around a key support level and it looks like the soft
landing vibes might be returning now that the hangover from the more hawkish
than expected FOMC dot plot might be in the rear view mirror.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite continues to consolidate around the key support at
13174. It’s all bout having the patience to wait for a clear breakout with the
target on the upside standing at the downward trendline around
the 13800 level and on the downside at the 12274 support.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the recent
rally got rejected from the red 21 moving average and the
38.2% Fibonacci retracement level. The
lack of a follow through from the rejection, and the consolidation around the
support level might be a signal that the Nasdaq Composite could be about to
start a correction to the upside.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely that we have a clear range between the low around the 12965 level and
the resistance at the 38.2% Fibonacci retracement level. In such instances, the
best strategy may be to wait for a clear breakout and go with the flow, but one
can also “play the range” by selling at resistance and buying at support.

Upcoming
Events

Today it’s all about the NFP report which is the only one the Fed will
see before its next rate decision. The US jobs data going into the NFP was
strong, so the expectations might be skewed to the upside.

This article was written by FL Contributors at www.forexlive.com.

The US dollar continues to lose ground ahead of today’s non-farm payrolls report. That’s helped to boost EUR/USD up to 1.0558.

For the 10am NY cut, there are some huge expiries today, both in the 1.0650 range and 1.0450 range.

The euro options expirations aren’t the only notable ones with some big Aussie numbers rolling off, particularly at 0.6400, which will surely be in play with AUD/USD trading at 0.6365.

Details:

• EUR/USD: 1.0450 (3.4B), 1.0500-10 (2.5B), 1.0550-60 (2.7B)
  1.0575-80 (1.2B), 1.0600 (900M), 1.0640-50 (3.4B), 1.0685 (2.8B)

• USD/CHF: 0.9030 (800M), 0.9160 (600M), 0.9250 (300M)
• EUR/GBP: 0.8610 (350M), 0.8785 (400M)
• GBP/USD: 1.2100 (400M), 1.2175 (814M), 1.2200 (850M), 1.2225 (1B)
  1.2250 (485M)
• AUD/USD: 0.6300 (1.5B), 0.6350 (700M), 0.6380-85 (1.3B)
  0.6390-0.6400 (4.3B)
• NZD/USD: 0.5880-90 (640M), 0.5940 (200M), 0.5990-95 (600M)
• USD/CAD: 1.3625 (1.5B), 1.3665 (680M), 1.3750 (340M)
• USD/JPY: 148.75 (360M)
  149.00 (895M), 149.35-50 (2.5BLN), 150.00 (2.1BLN)

This article was written by Adam Button at www.forexlive.com.

US:

• The Fed left interest rates unchanged as
  expected at the last meeting.
• The macroeconomic projections were revised higher
  as the economy showed much stronger resilience than expected and the Dot Plot
  showed that the majority of members still expects another rate hike by the end
  of the year with less rate cuts in 2024.
• Fed Chair Powell
  reaffirmed their data dependency but added that they will proceed carefully as
  they are trying to find the optimal level of rates. Powell also added that the
  soft landing is not the base case at the moment, although they are aiming for
  it.
• The latest US Core PCE
  came
  in line with expectations with disinflation continuing steady.
• The labour market
  displayed signs of softening although it remains fairly solid as seen also with
  another strong beat in Jobless Claims
  yesterday and with the beat in Job Openings.
• The ISM Manufacturing PMI beat
  expectations while the ISM Services PMI came in
  line with forecasts in another sign that the US economy remains resilient.
• The miss in the ADP report led to
  some USD weakness which might continue if the NFP data misses forecasts.
• The market doesn’t expect the Fed to hike again at
  the moment.

Australia:

• The
  RBA kept interest rates unchanged as expected as they are seeing inflation
  returning to target with the current level of interest rates.
• The
  latest monthly CPI showed that core inflation is
  slowing.
• The
  labour market is weakening as we got a big miss
  in July and the bulk of jobs added in August were part time.
• The
  Australian Manufacturing PMI fell further into contraction while
  the Services PMI jumped back into expansion.
• The
  market expects the RBA to hold rates steady at the next meeting as well.

AUDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that the AUDUSD pair
recently broke out of the range and pulled back into the broken support now turned resistance which
might end up in a classic “break and retest” pattern. This is where the sellers
should step in with a defined risk above the resistance to
target the 0.6168 level.

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we have also
the 38.2% Fibonacci retracement level
for confluence and the
price is indeed reacting to the resistance as we already got a double
rejection, which might end up in a double top pattern.
The buyers will want to see the price breaking higher to invalidate the bearish
setup and position for a rally back into the 0.6500 resistance.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that we
have a trendline that
should confirm the bearish setup in case the price breaks below it. In fact, we
can expect more sellers to pile in on a break while the buyers should fold,
ultimately increasing the bearish momentum. The buyers, on the other hand, are
likely to lean on the trendline to position for a rally into the 0.65
resistance.

Upcoming Events

Today it’s all about the NFP report which is the only one the Fed will
see before its next rate decision. The US jobs data going into the NFP was
strong, so the expectations might be skewed to the upside.

This article was written by FL Contributors at www.forexlive.com.