The Nasdaq Composite seems to be bottoming out as
the US data continues to support the soft landing narrative with Jobless Claims last
week beating once again expectations and the ISM Manufacturing PMI
yesterday showing signs of rebounding. The fears of a hawkish Fed might be put
aside if the economy remains resilient and the labour market doesn’t
deteriorate too much.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite rallied back above the key resistance around
the 13174 level. The last week’s breakout is starting to look like a fakeout,
which is a reversal pattern, and we might see a rally into the black trendline around
the 13800 level. A break back below the 13174 level would be ominous for the
buyers and we should see the sellers pile in aggressively to position for a
drop into the 12274 support.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the price is
struggling at a strong resistance defined by the 38.2% Fibonacci retracement level
and the red 21 moving average. This is
where the sellers are stepping in with a defined risk above the Fibonacci level
to target another break below the 13174 support. The buyers, on the other hand,
will want to see the price breaking higher to pile in and target the black
trendline.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we had
a divergence with
the MACD right
after the breakout. This is generally a sign of weakening momentum often
followed by pullbacks or reversals. In this case, we might be in front of a
reversal as the price action has also formed what looks like an inverted head and shoulders
pattern. The neckline is right around the 38.2% Fibonacci retracement level so
a break above it should trigger a rally into the highs. The sellers will need
the price to sell off from here to invalidate the bullish setup and position
for new lows.

Upcoming
Events

Today, we will have the US Job Openings data which
led to a strong rally the last time as the big miss made Treasury yields to
fall due to less labour market tightness and less hawkish Fed expectations. Tomorrow,
it will be the time for the ADP report and the ISM Services PMI. On Thursday,
we will see the Jobless Claims data, which continues to show a solid labour
market. Finally on Friday, it will be the time for the NFP report which is the
only one the Fed will see before its next rate decision.

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

• The nerves are kicking in again in the equities space
• USD/JPY within touching distance of 150 as higher yields continue to pave the way
• AUD/USD stays under pressure as RBA stays on the sidelines
• Recent pace of yen fall makes intervention less likely – former top currency diplomat
• ECB’s Lane: Progress to 2% inflation won’t be as quick as to 4%
• ECB’s Lane: The key is to maintain rates at this level for as long as needed
• ECB’s Simkus: Inflation is on its way down
• Switzerland September CPI +1.7% vs +1.8% y/y expected

Markets:

• USD leads, AUD lags on the day
• European equities lower; S&P 500 futures down 0.3%
• US 10-year yields up 4.6 bps to 4.730%
• Gold down 0.2% to $1,824.38
• WTI crude down 0.5% to $88.38
• Bitcoin down 1.1% to $27,541

There wasn’t much in terms of headlines during the session as the focus stays on the bond market. Treasury yields are running higher once again and that is leading to a further bid in the US dollar, with USD/JPY sitting within a whisker of touching the 150 mark.

The greenback held firmer throughout with EUR/USD hovering near its lowest since December last year at 1.0460-70 levels. The antipodeans are the laggards, with AUD/USD down 1.0% to touch 0.6300 after the RBA left the cash rate unchanged in today’s policy decision.

A turn lower in the risk mood, similar to yesterday, is not helping as equities hit the skids after a decent start to the session. S&P 500 futures were up 0.2% at one point but are seen down over 0.3% on the day at the lows. European indices are also back in the red as the jitters are resurfacing amid further selling in the bond market as well.

It’s back to the familiar theme for broader markets, continuing the trend that we have been seeing since mid-September.

This article was written by Justin Low at www.forexlive.com.

10-year yields in the US are up over 4 bps to 4.726% currently and that is continuing to keep the dollar more bid across the board. USD/JPY has been relatively cautious in pushing the invisible boundary set out by Tokyo at the 150 mark but it almost seems inevitable that we will breach past the figure level at this point.

Whether or not that will trigger intervention by Japan remains to be seen but the pressure is continuing as Treasury yields are shooting for the stars as seen in the chart above.

For today, there are large option expiries at the figure level for USD/JPY as well but as mentioned here, it’s more of a psychological battle more than anything else for the pair right now.

As we look towards US trading, the pair is trading at 149.94 and that is just a hop, skip, and a beat away from running off above 150.00 once buyers touch the key threshold.

This article was written by Justin Low at www.forexlive.com.

After a bright start to European trading (similar to yesterday), equities are feeling a bit jittery once more as we look towards US trading later. US futures have turned lower in the last one hour and European indices are back in the red after having pared opening losses today.

It is all about higher Treasury yields once again and 10-year yields are now up 4 bps to 4.724% on the day. That is weighing on equities sentiment while also keeping the dollar underpinned with USD/JPY hovering just under the 150.00 mark at 149.93 currently.

This article was written by Justin Low at www.forexlive.com.

US:

• The Fed left interest rates unchanged as
  expected.
• 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 last
  week with a strong beat in Jobless Claims.
• The ISM Manufacturing PMI beat
  expectations yesterday in another sign that the US economy remains resilient.
• 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.
• RBA
  Governor Lowe in his speech reaffirmed that if inflation remains sticky, they
  will have to tighten more.
• 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
got rejected from the 0.65 resistance again
and sold off into the support, ultimately breaking it. The target for the
sellers should be the 2022 low around the 0.6168 level. For now, we can expect
the pullbacks to be faded as the sellers remain in control.

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that the pair is
now a bit overstretched on the downside as depicted by the distance from the
blue 8 moving average. In such
instances, we can generally see a pullback into the moving average or some
consolidation before the next move. In fact, we might see a pullback into the
broken support turned resistance which
could end up in a classic “break and retest” pattern. This is where we can
expect the sellers to step in with a defined risk above the resistance to
target the 0.6168 level. The buyers, on the other hand, will want to see the
price breaking above the resistance to start targeting the 0.65 level again.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that we
have a trendline that
might act as resistance in case the bearish momentum proves to be strong. That
will be the first shorting point for the sellers, with the resistance around
the 0.6370 being the last line of defence. The buyers should pile in at every
break, but they will need the price to rally above the 0.6380 level to
invalidate the bearish setup and target the 0.65 resistance.

Upcoming Events

This week we have many key economic releases that will
culminate in the US NFP report on Friday. Today, we will have the US Job
Openings data which led to a strong rally the last time as the big miss made
Treasury yields to fall due to less labour market tightness and less hawkish
Fed expectations. Tomorrow, it will be the time for the ADP report and the ISM
Services PMI. On Thursday, we will see the Jobless Claims data, which continues
to show a solid labour market. Finally on Friday, it will be the time for the
NFP report which is the only one the Fed will see before its next rate
decision.

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

• Dollar stays poised so far in European trading
• Equities hit the skids as higher yields is still the name of the game
• Gold stays in retreat, set for sixth straight day of losses
• Japan finance minister Suzuki: Closely watching FX moves with strong sense of urgency
• Japan’s Matsuno says closely watching FX moves with a high sense of urgency
• Eurozone September final manufacturing PMI 43.4 vs 43.4 prelim
• UK September final manufacturing PMI 44.3 vs 44.2 prelim
• UK September Nationwide house prices 0.0% vs -0.4% m/m expected
• Switzerland September manufacturing PMI 44.9 vs 40.5 expected
• SNB total sight deposits w.e. 29 September CHF 476.3 bn vs CHF 475.1 bn prior

Markets:

• CHF leads, AUD lags on the day
• European equities lower; S&P 500 futures flat
• US 10-year yields up 5.4 bps to 4.628%
• Gold down 0.7% to $1,835.49
• WTI crude up 0.9% to $91.61
• Bitcoin up 5.3% to $28,319

It’s a new week, month, and quarter but we’re getting the same old brand new theme in markets. The US government has averted a shutdown for now and equities gapped higher while bond yields surged to start the day.

But as has been the case over the past few weeks, there is always only room for one to be right and surprise, surprise.. It was the bond market again.

Higher yields continue to be the bane for equities while proving to be the boon for the US dollar.

The greenback surged higher across the board with USD/JPY continuing to stay within touching distance of the 150.00 mark, despite verbal intervention efforts by Japanese officials.

Meanwhile, EUR/USD is down 0.3% to 1.0530 levels while GBP/USD is down 0.3% to 1.2150 levels currently. The commodity currencies aren’t able to find much relief as well amid a turn in risk sentiment during the session. AUD/USD is the laggard, down 0.6% to 0.6395 at the lows for the day now.

As higher yields remain the name of the game, stocks are finding it tough to sustain any rallies today – especially now after month-end and quarter-end are done with. US futures were up around 0.7% initially but have all but pared those gains with S&P 500 futures now sitting down 0.1% on the day.

In the commodities space, it’s also the same old story with gold dropping lower amid higher yields while oil is the only one able to go toe to toe with the dollar it would seem.

This article was written by Justin Low at www.forexlive.com.

Last week, the market remained under pressure as
the more hawkish than expected FOMC dot plot was
still fresh in everyone’s mind. The economic data continues to support the
soft-landing narrative with Jobless Claims showing
a solid labour market and Core PCE trending
downwards. The last day of the week, we got a small bounce across the board as
the market took a breather after the heavy selloff after the FOMC meeting. We
will see if it was just a pullback or the start of a new rally.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite rallied back above the key support formed
by the trendline and the
38.2% Fibonacci retracement level.
Is this just a pullback and we’ll another selloff or the market is turning
around? The buyers are likely to keep piling in around here with a defined risk
below the support, while the sellers will want to see the price breaking lower
again to jump onboard and ride the fall into the 12274 level.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the bounce
back above the support got rejected at the red 21 moving average and the
38.2% Fibonacci retracement level. This is the resistance that the buyers will
need to break to start targeting the downward trendline around the 13800 level.
The sellers, on the other hand, will keep on leaning on the moving average to
position for further downside.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
price has been diverging with
the MACD, which
is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, the price broke above the trendline, and the moving
averages crossed to the upside, which might be an early signal of a reversal.
The buyers should pile in here with a defined risk below the support to
position for a rally into the downward trendline around the 13800 level. The
sellers, on the other hand, will want to see the price breaking below the
support again to pile in and ride the selloff into the 12274 level.

Upcoming
Events

This week we have many key economic releases that will
culminate in the NFP report on Friday. Today, we will see the latest ISM
Manufacturing PMI. Tomorrow, we will have the Job Openings data which led to a
strong rally the last time as the big miss was interpreted as a good thing due
to less labour market tightness and less hawkish Fed. On Wednesday, it will be
the time for the ADP report and the ISM Services PMI. On Thursday, we will see
the Jobless Claims data, which continues to show a solid labour market. Finally
on Friday, it will be the time for the NFP report which is the only one the Fed
will see before its next rate decision.

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

It’s not a good look for equities now as US futures pare almost all of its earlier gains, despite even getting help from a gap higher at the open. European indices are also now all in the red, with the Eurostoxx down roughly 0.3% currently. It once again highlights the fact that the bond market is in charge of proceedings and traders are back to focusing on that after month-end and quarter-end last week.

10-year Treasury yields are up nearly 6 bps to 4.63% at the moment and threatening a further push higher amid the breakout since the middle of last month. That in turn is also underpinning the US dollar, as the greenback leads the charge across the board.

This article was written by Justin Low at www.forexlive.com.

The dollar is sitting higher on the day now, only trailing behind the Swiss franc. The greenback continues to be in a firm spot as Treasury yields are holding at the highs, with 10-year yields now nearly 6 bps to 4.63% on the day. With month-end and quarter-end flows out of the way, the dollar is starting to look ripe again as things turn back into its favour.

EUR/USD is down 0.3% to 1.0540 and breaking back below its 100-hour moving average (red line), after having seen sellers defend a bounce at the 200-hour moving average (blue line) on Friday last week. This now sees sellers regain near-term control and will be poised to try and retest the 1.0500 mark again.

Elsewhere, USD/JPY is also keeping near the highs for the day at 149.70 despite Japan intervention fears while AUD/USD is down 0.6% to just under 0.6400 again as risk trades are also starting to hit the skids now on the session.

This article was written by Justin Low at www.forexlive.com.

Last week, the market remained under pressure as
the more hawkish than expected FOMC dot plot was
still fresh in everyone’s mind. The economic data continues to support the
soft-landing narrative with Jobless Claims showing
a solid labour market and Core PCE trending
downwards. The last day of the week, we got a small bounce across the board as
the market took a breather after the heavy selloff after the FOMC meeting. We
will see if it was just a pullback or the start of a new rally.

Dow Jones Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Dow Jones
bounced around a key support at the
33622 level and pulled back into the blue 8 moving average before
falling back into the support. The sellers would have undoubtedly a better risk
to reward setup if the price rallied all the way back into the downward trendline where we
can also find the 61.8% Fibonacci retracement level.
For now, the sellers remain in control and the buyers will need to break some
key levels before turning the trend around.

Dow Jones Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we have a
strong resistance around the 34000 level where we have also the confluence with the
red 21 moving average and the 38.2% Fibonacci retracement level. If the price
rallies into that resistance again we can expect the sellers stepping in with a
defined risk above the resistance to target the 32597 level. The buyers, on the
other hand, will want to see the price breaking higher to position for a rally
into the trendline.

Dow Jones Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
Dow Jones seems to be consolidating around the 33622 support and we can expect
the buyers to keep piling in around here with a defined risk below the low to
target the trendline. If the price breaks below the low, the sellers should
jump onboard and ride the selloff into the next support around the 32597 level.

Upcoming Events

This week we have many key economic releases that will
culminate in the NFP report on Friday. Today, we will see the latest ISM
Manufacturing PMI. Tomorrow, we will have the Job Openings data which led to a
strong rally the last time as the big miss was interpreted as a good thing due
to less labour market tightness and less hawkish Fed. On Wednesday, it will be
the time for the ADP report and the ISM Services PMI. On Thursday, we will see
the Jobless Claims data, which continues to show a solid labour market. Finally
on Friday, it will be the time for the NFP report which is the only one the Fed
will see before its next rate decision.

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