<ul><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/evans-fed-is-looking-for-the-right-level-of-restrictiveness-20221104/“>Evans: It’s likely Fed funds peak will be revised ’slightly higher‘ in December</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/stocks-moving-higher-is-still-a-hard-uphill-road-20221104/“>Stocks moving higher is still a hard uphill road to travel</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/unexpected-surge-in-canadian-jobs-in-october-makes-50-bps-from-boc-more-likely-cibc-20221104/“>Unexpected surge in Canadian jobs in October makes 50 bps from BOC more likely – CIBC</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/baker-hughes-us-oil-rig-count-3-20221104/“>Baker Hughes US oil rig count +3</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/more-from-feds-collins-all-options-on-the-table-at-feds-next-meeting-20221104/“>Feds Collins:All options on the table at Fed’s next meeting. Supports slower pace of hikes</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/technical-analysis/audusd-on-track-for-the-biggest-move-since-2011-20221104/“>AUDUSD on track for the biggest % move since 2011. Can the momentum keep up?</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/vitol-threatens-to-cut-off-german-natural-gas-in-1-billion-standoff-20221104/“>Vitol threatens to cut off German natural gas in $1 billion standoff</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/feds-barkin-we-could-potentially-have-a-higher-end-point-on-rates-20221104/“>Fed’s Barkin: We could potentially have a higher end-point on rates</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/feds-collins-time-for-fed-to-shift-focus-from-size-of-rate-hikes-to-the-ultimate-level-20221104/“>Fed’s Collins: Time for Fed to shift focus from size of rate hikes to the ultimate level</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/oil-gets-a-double-dose-of-good-news-climbs-more-than-4-20221104/“>Oil gets a double dose of good news, climbs more than 4%</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/canadian-dollar-suddenly-has-everything-going-for-it-20221104/“>Canadian dollar suddenly has everything going for it</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/canada-october-employment-change-1083k-vs-100k-20221104/“>Canada October employment change 108.3K vs. 10.0K</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/us-october-non-farm-payrolls-261k-vs-200k-expected-20221104/“>US October non-farm payrolls +261K vs +200K expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/chinas-xi-we-will-continue-to-open-up-and-pursue-win-win-cooperation-20221104/“>China’s Xi: We will continue to open up and pursue win-win cooperation</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/boes-bailey-says-wont-sell-gilts-when-sales-might-increase-market-dysfuction-20221104/“>BOE’s Bailey says won’t sell gilts when sales might increase market dysfuction</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/technical-analysis/the-is-the-strongest-and-the-is-the-weakest-as-the-na-session-begins-20221104/“>The AUD is the strongest and the USD is the weakest as the NA session begins</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/forexlive-european-fx-news-wrap-dollar-drops-as-risk-gains-on-china-hope-nfp-up-next-20221104/“>ForexLive European FX news wrap: Dollar drops as risk gains on China hope, NFP up next</a></li></ul><p>The US nonfarm payroll came in better than expected at 261K vs 205K estimate. The prior month was revised higher to 315K from 263K. So stronger 300K growth month on month with the revision included. The average hourly earnings came in at 0.4% vs 0.3%. So that was higher. The unemployment rate moved higher to 3.7% but coming off record low levels is 3.7% much different than 3.5%? It still is a strong employment market. </p><p>The dollar went higher right?</p><p>Not so fast. </p><p>Initially, the move was to the upside, but stocks in pre-market trading hung in there. Then the dollar, perhaps seeing stocks not going down, started to sell. The stocks starting to see the dollar fall, and it moved higher. Yields moved around, but the shorter end started to come down helped by some Fed talk from Fed’s Collins who said it is time for the Fed to shift focus from size of rate hikes to ultimate level, and later said that all options should be on the table for the Fed’s next meeting including a 25 basis point hike and a 75 basis point hike. </p><p>Hmmmm. OK. </p><p>Fed’s Barkin said </p><ul><li>Now real rates are positive so you could credibly say we have our foot on the brake</li></ul><p>Hmmmm. OK. Although are rates at 4.65% for the 2 year and the Fed funds at 4% positive real rates? I thought PCE and CPI and other measures of inflation were still higher. </p><p>Anyway, it wasn’t until September 20, that the Fed policy was „restrictive“ (i.e., above 2.5%) and this last hike did move further into restrictive policy, but employment remains strong. Before September 20, you can argue that policy was still expansionary. </p><p>Fed Chair Powell was less positive about the prospects for a peak rate soon this week.</p><p>Time will tell. </p><p>The markets today wanted all to end, with stops moving higher, the yield curve steeper, and the dollar lower. So that’s what it did.</p><p>Looking at the strongest to the weakest of the major currencies, the AUD is ending the day where it began, as the stronges of the major currencies. In fact the AUDUSD pair had its biggest one day advance from a percentage basis going back to 2010 (up 3.07%). </p><p>The USD was the weakest of the major currencies with declines of 1.12% (versus the JPY) to 3.07% (vs the AUD). . </p><p>In the US equity market, the major indices moved higher initially at the open, and then gave back all the gains and traded lower, before rebounding and closing higher for the day. </p><ul><li>Dow industrial average closed up 403.53 points or 1.26% at 32404.79</li><li>S&P closed up 50.72 points or 1.36% at 3770.60</li><li>Nasdaq closed up 132.32 points or 1.28% at 10475.26</li><li>Russell 2000 closed up 20.13 points or 1.13% at 1799.86</li></ul><p>For the week, the major indices still closed lower.</p><ul><li>Dow industrial average fell -1.39%</li><li>S&P index fell -3.34%</li><li>NASDAQ index tumbled 5.65%</li><li>Russell 2000 fell -2.54%</li></ul><p>In the US debt market today, the yield curve steepened with the shorter end lower and the longer end higher.:</p><ul><li>2 year is trading at 4.66%, -4.1 basis points</li><li>5 year is trading at 4.332% -1.9 basis points</li><li>10 year is trading at 4.164% +4.1 basis points</li><li>30 year is trading at 4.257% +10.5 basis points</li></ul><p>In other markets as the week comes to a close:</p><ul><li>Spot gold is trading up $51 on the back of the week dollar that’s up 3.16% at $1680.50. Gold was up at 2.17% this week</li><li>Spot silver is trading up $1.43 or 7.42% the $20.88. Silver rose 8.64%</li><li>WTI crude oil is trading up $4.44 or 5.04% at $92.61. WTI crude oil rose 5.37%</li><li>Bitcoin love the risk on and is trading at $21,053. That’s up $844 on the day. For the week bitcoin rose 2.23%</li></ul><p>Thank you for all your support. Wishing you all a great and healthy weekend. </p>

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

<p>Comments in the Fed’s stability report</p><ul><li>Treasury market has functioned smoothly since last report in May</li><li>Market liquidity remained low in several key areas and that could amplify volatiltiy and may ultimately impair market functioning</li><li>Economic outlook has weakened, uncertainty remains elevated</li></ul><p>US regulators haven’t done enough to prevent air pockets in the bond market. The explosion in short-dated options trading is also something that’s obviously going to end in disaster at some point as well.</p>

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

<p>Here’s the picture in gold the way I see it.</p><p>1) It has declined for seven straight months</p><p>That’s certainly not a sign of a bull market but nothing falls in a straight line and the decline of 13% is better than many major currencies over that period. The decline is mostly a story of US dollar strength and a tightening Fed.</p><p>2) Central banks are buying heavily</p><p>The World Gold Council reported that central banks bought 399 tons of bullion in the third quarter, which was nearly double the previous record for Q3. It’s unclear which central banks were buying but eyes are on Russia and China due to the US’s weaponization of the US dollar.</p><p>3) Beyond maximum central bank hawkishness</p><p>There were 6 major central bank decisions in the past week and 5 of them were dovish. The Fed ratcheted up the terminal rate but only „slightly“ as Chicago Fed President Charles Evans <a target=“_blank“ href=“https://www.forexlive.com/centralbank/evans-fed-is-looking-for-the-right-level-of-restrictiveness-20221104/“ target=“_blank“>said </a>today. To be sure, central banks are still hiking but the pace is slowing and markets generally move on the second derivative.</p><p>What worries me is the technicals</p><p>The chart isn’t great. There’s still a daunting double top at $2070 and the latest bounce looks like a retest of the base of it before a further fall. The measured target of the double top is $1350.</p><p>What makes me skeptical that it’s going to happen is that it hasn’t happened yet. It’s been a perfect storm of USD strength, central bank hawkishness and a rout in risk assets yet it’s held up ok.</p>

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

<p>The EURUSD is moving to a new session high and in the process is up testing one of my old favorite levels. The 0.99515 level. That level was the swing low back in July after the price broke below the parity level for the first time. In September the price moved down to test it, before breaking to the cycle low for the year. Last month, the pair used the level as a risk defining target as well.</p><p>We are back testing it. A move above would have traders looking toward the parity level and then the falling 100 day MA at 1.00515. Hold below and traders will look toward 0.9898.</p>

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

<p>The AUD is the strongest and the USD is the weakest as the North American session begins. In the US, the Bureau of Labor Statistics will release their monthly jobs report (Canada will also release their monthly employment data). The expectations are for</p><ul><li>Nonfarm payroll: 205K vs. 263K last month</li><li>Unemployment rate 3.5%</li><li>Avg hourly wages 0.3% vs. 0.3% last month. Year on year 4.7% vs. 5.0%</li><li>Average workweek 34.5 hours unchanged from the previous week</li><li>participation rate last month came in at 62.3 percent</li></ul><p>The leisure and hospitality sector is still 1.1M behind the pre-pandemic level which may be an influence in a rise. Meanwhile the tech sector has announced that about 1/3 of the job announced cuts. Do we see a shift in this months numbers within the details that shows shifting winds. </p><p>US stocks are higher ahead of the report. The major indices are down 4 consecutive days. US yields are trading higher. European stock indices and yields are also higher.</p><p>In Europe this morning, German factory orders plunged -4% vs. -0.5% expected. Ouch. However services PMI although below the 50 level were higher than expectations and higher than last month at 48.6 vs. 48.2.</p><p>The Canada jobs report is expected to show an employment change of a 11.0 K vs. 21.1 K last month. The unemployment rate is expected to rise to 5.3% from 5.2%. Last month full-time employment gain 5.7K while part time employment rose by 15.4K. Average hourly wages came in last month that 5.2% last month</p><p>Looking at other markets ahead of the key jobs reports:</p><ul><li>Spot <a target=“_blank“ href=“https://www.forexlive.com/terms/g/gold/“ target=“_blank“ id=“c0483026-a32e-4e25-8e74-f808d52790c3_1″ class=“terms__main-term“>gold</a> is trading up $22 or 1.35% at $1651.20.</li><li>Spot <a target=“_blank“ href=“https://www.forexlive.com/terms/s/silver/“ target=“_blank“ id=“f3f46493-8e6f-475a-a7ba-a6c320e4d51c_1″ class=“terms__secondary-term“>silver</a> is up $0.44 or 2.3% at $19.89</li><li>crude oil is trading up sharply by $3.10 and $91.27</li><li>bitcoin is trading higher $20,576</li></ul><p>In the market for US stocks, the major indices are trading higher after 4 straight days of declines:</p><ul><li>Dow industrial average is up 157 points after yesterdays -146.51 point decline</li><li>S&P index is up 25.5 points after yesterdays -39.80 point decline</li><li>NASDAQ index is up 76 points after yesterdays -181.86 point decline</li></ul><p>In the European equity markets, the major indices are higher:</p><ul><li>German DAX +1.86%</li><li>France’s CAC up 2.4%</li><li>UK’s FTSE 100 up 1.44%</li><li>Spain’s Ibex up 0.46%</li><li>Italy’s FTSE MIB up 0.92%</li></ul><p>In the US debt market, prices remain pressured/yields are higher after the FOMC rate decision this week and the comments from Fed’s Powell:</p><p>In the European debt market, the benchmark 10 year yields are higher across the board:</p>

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

<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/china-reportedly-working-on-a-plan-to-scrap-covid-flight-suspensions-20221104/“>China reportedly working on a plan to scrap Covid flight suspensions</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/china-says-not-aware-of-report-that-it-is-preparing-to-end-covid-flight-suspensions-20221104/“>China says „not aware“ of report that it is preparing to end Covid flight suspensions</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/china-to-make-significant-changes-to-covid-policy-soon-says-former-government-expert-20221104/“>China to make significant changes to Covid policy soon, says former government expert</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/boes-pill-we-still-think-there-is-more-to-do-on-inflation-pressures-20221104/“>BOE’s Pill: We still think there is more to do on inflation pressures</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/boes-hauser-says-wait-and-see-on-gilt-sales-20221104/“>BOE’s Hauser says „wait and see“ on gilt sales</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/germany-september-industrial-orders-40-vs-05-mm-expected-20221104/“>Germany September industrial orders -4.0% vs -0.5% m/m expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurozone-september-ppi-16-vs-17-mm-expected-20221104/“>Eurozone September PPI +1.6% vs +1.7% m/m expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurozone-october-final-services-pmi-486-vs-482-prelim-20221104/“>Eurozone October final services PMI 48.6 vs 48.2 prelim</a></li></ul><p>Markets:</p><ul><li>AUD leads, USD lags on the day</li><li>European equities higher; S&P 500 futures up 0.7%</li><li>US 10-year yields up 3 bps to 4.154%</li><li>Gold up 1.3% to $1,650.68</li><li>WTI crude up 3.7% to $91.43</li><li>Bitcoin up 1.7% to $20,584</li></ul><p style=““ class=“text-align-justify“>European trading today was meant to be more of a placeholder session ahead of the US non-farm payrolls report later today. However, hope is a powerful thing as markets caught whiff of another China reopening headline and domestic stocks soared. The positive sentiment spilled over with US futures ticking higher while the dollar sagged across the board.</p><p style=““ class=“text-align-justify“>The greenback is under pressure against the commodity currencies in particular, with the aussie choosing to realign itself with Chinese stocks today. AUD/USD is up 1.4% to 0.6380, advancing from around 0.6340 in the handover from Asia. Meanwhile, USD/CAD is down 0.9% to 1.3620 and NZD/USD is up 1.1% to 0.5840 on the day currently.</p><p style=““ class=“text-align-justify“>The dollar’s sluggishness also sees EUR/USD up 0.5% to near 0.9800 while GBP/USD is up 0.4% to 1.1210 with the high earlier touching 1.1250 as the pound looked to try and claw back some of its post-BOE drop.</p><p style=““ class=“text-align-justify“>In the commodities space, gold is up over 1% as it bounces off the September and October lows to around $1,650 while oil is benefitting strongly from the China headlines as it is up nearly 4% to above $91.</p><p style=““ class=“text-align-justify“>Well, over to the US jobs report now.</p>

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

<p style=““ class=“text-align-justify“>The key focus in markets today is on the US jobs report later but with regards to the Fed outlook, this is very much just the appetizer. Sure, labour market conditions are vital in reaffirming the Fed’s hawkish nod but the main course is still inflation numbers and we will only get that via the CPI data next week.</p><p style=““ class=“text-align-justify“>We’re still at a point where the playbook to the non-farm payrolls is rather straightforward, that being <a target=“_blank“ href=“https://www.forexlive.com/news/when-bad-news-is-good-news-20220726/“ target=“_blank“>bad news is good news</a>; vice versa. A hot report later will vindicate Powell’s hawkish remarks this week while a softer report will take some edge of that.</p><p style=““ class=“text-align-justify“>The dollar is weaker so far today and is holding on the softer side as equities are pushing higher in the run up to the data. In part, one can argue that markets are hopeful that we are moving somewhat towards a reopening trade with regards to China but it also looks like a bit part retracement to the post-Fed reaction.</p><p style=““ class=“text-align-justify“>In any case, the jobs report later will be one to dictate proceedings before the weekend so let’s see what that has to offer later today.</p>

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

<ul><li>Hope to be able to talk more about gilt sales in the next week or two</li></ul><p style=““ class=“text-align-justify“>So far, they are sticking to the game plan but this is with regards to the temporary purchases made this year. As for QT in general, I still have reservations over how they will be able to keep with that as the economy enters into a deep recession next year.</p>

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

<ul><li>Prior +5.0%</li><li>PPI +41.9% vs +42.0% y/y expected</li><li>Prior +43.3%; revised to +43.4%</li></ul><p style=““ class=“text-align-justify“>Another month, another rise in euro area producer prices. The details show a 2.6% increase in the energy sector, a 1.0% jump for non-durable consumer
goods, a 0.4% increase for capital goods and for durable consumer goods and a 0.1% tick higher for intermediate goods.</p>

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