• WSJs Timiraos: A solid September payroll takes a lot of November Fed meeting
• US major indices close the day higher helped by strong jobs
• White House economic advisor Brainerd expects impact on employment from hurricane Helene
• Oil prices move lower after present Biden says he woul not support striking an oilfield
• REUTERS: US military carries out strikes against multiple Houthi targets in Yemen
• Israeli army is preparing to expand its operation in southern Lebanon
• Baker Hughes oil rig count -5 at 479
• European equity close: Decent finish but down on the week
• JPMorgan now sees the Fed cutting by 25 basis points
• Bank of America now sees Fed cutting 25 bps in November from 50 bps
• More from Goolsbee: Will have discussions about what rate we need to ultimately settle on
• Fed’s Goolsbee: This is a super jobs report
• This was the early tell in the recession reversal trade
• Tech sector rallies: Innovation fuels market gains
• Fed’s Williams doesn’t comment on monetary policy or the outlook
• Good news is good news: US stock futures jump
• US September non-farm payrolls +254K vs +140K expected
• The JPY is the strongest and the NZD is the weakest as the NA session begins
• Forexlive European FX news wrap: Awaiting the US NFP release
• ECB’s De Guindos says inflation to near 2% by 2025 but too early for victory laps

The US September jobs report today exceeded expectations, with non-farm payrolls increasing by 254K compared to the 140K anticipated. The unemployment rate fell slightly to 4.1%, nearly reaching 4.0%, and the participation rate held steady at 62.7%.

Private payrolls surged by 223K, while average hourly earnings rose by 0.4% month-over-month and 4.0% year-over-year, both above forecasts.Manufacturing payrolls dropped by 7K, an improvement over prior data.

The household survey showed a gain of 430K jobs, with a notable increase in full-time employment (+631K) but a decrease in part-time jobs (-201K). The strong data diminished expectations for a Federal Reserve rate cut at the November meeting, driving the US dollar higher, but implies a more solid US economy.

With the Fed feeling that inflation is under control, if the jobs gains fill job needs, there is a chance it may not be inflationary and therefore may keep the Fed on it recalibration path. Fed’s Goolsbee was the only Fed officisl who commented on the report, descriving it as „super,“ and also highlighted the end of the port strike as additional positive news.

However, he cautioned against reacting too strongly to a single data point, emphasizing that more reports like this would increase confidence in achieving full employment. He noted that strong job numbers are likely to reflect strong GDP growth.

While the Fed is still determining the neutral interest rate, he suggested it is likely higher than zero and could fall within the 2.5-3.5% range, though there is time to figure this out. Goolsbee stressed the importance of maintaining current economic conditions, and while productivity growth could lead to a higher neutral rate, the economy would need to handle it.

He also acknowledged that broad indicators show the labor market is cooling, but rejected the notion of a „soft landing“ as the economy continues to move forward.

The Fed’s ideal scenario would see unemployment between 4-4.5% and inflation around 2%, which he believes would satisfy the Fed’s goals. As more data becomes available ahead of the next Fed meeting, Goolsbee warned that external shocks could still derail efforts toward a soft landing.

For now, however, it is back to happy/giddy times. Next week the US CPI data will be released with the expectation for the headline (0.1%) and the core (0.2%) to be on the tame side once again, although the core YoY is still elevated at 3.2%. The headline YoY is expected to dip to 2.3% from 2.5%.

The news today sent stocks higher with the Dow industrial average closing at a new record high. A snapshot of the closing levels shows:

• Dow industrial average rose 341.16 points or 0.81% at 42352.75
• S&P index rose 51.13 points or 0.90% at 5751.07
• NASDAQ index rose 219.37 points or 1.22% at 18137.85

The small-cap Russell 2000 rose 32.65 points or 1.50% at 2212.79.

For the trading week, the gains were modest with the Nasdaq up 0.10%, the Dow up 0.09% and the S&P up 0.22%.

IN the US debt market, yields moved sharply higher with:

• 2 year yield: 3.928%, +21.4 basis points
• 5 year yield 3.807%, +17.4 basis points
• 10-year yield 3.967%, +11.7 basis points
• 30 year yield 4.249%, +.0 basis points

For the trading week:

• 2 year rose 36.5 basis points
• 5 year rose 30.0 basis points
• 10 year rose 21.3 basis points
• 30 year rose 14.5 basis points

Mortgage rates are back up 6.5%

Looking at the strongest weakest of the major currencies, the GBP and the USD are the strongest while the JPY is the weakest.

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

Wall Street Journal’s Nick Timiraos is out with a tweet saying:

• A very solid September payroll report probably takes a lot of the drama out of the November Fed meeting
• Likely leaves officials on course for a 25 basis point cut.

Looking at the probability of a 25 basis point cut, that is now at 99%, while remaining unchanged is that 1%.

At points last week, the intimate 50 basis point cut was upwards of 60% for November.

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

US stocks moved higher despite yields moving higher as US jobs showed strength and the striking dockworkers reached a tentative agreement averting a prolonged closure of key port’s

A snapshot of the closing levels shows:

• Dow industrial average rose 341.16 points or 0.81% at 42352.75
• S&P index rose 51.13 points or 0.90% at 5751.07
• NASDAQ index rose 219.37 points or 1.22% at 18137.85

The small-cap Russell 2000 rose 32.65 points or 1.50% at 2212.79.

For the trading week:

• Dow industrial average was able to reverse declines and close higher by 39.75 points or 0.09%
• S&P index also moved into positive territory with a gain of 12.90 points or 0.22%
• NASDAQ index rose by 18.26 points or 0.10%
• Russell 2000 could not reverse earlier declines and is closing down -11.90 points or -0.53% for the week

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

As the week comes to a close, the USDJPY is trading near the highs for the day and the week. The move to the upside today off the unexpected US jobs report, was able to take the price above a key swing area ceiling around the 147.33 level and also above the 38.2% retracement of the move down from the July 3 high at 148.116.

Both of those levels will be support for traders going into the new trading week. Going forward, if the price can remain above each, the buyers are still in play.

On the topside, the high price from August 15 at 149.356 is the next target to get to and through. Move above that level and traders would start to target a cluster of key targets including the:

• 50% midpoint of the move down from the July high at 150.75
• The 200 day moving average at 151.046
• The 100 day moving average at 151.599.

This week, the Japan’s PM dialed back his call for a hike, and BOJ Ueda said that the markets were unstable. In the past, he commented that he unstable market would keep the Bank of Japan on the sidelines. That has been a tail wind for a weaker JPY. The US jobs report, gave the dollar buyers more incentive to take the USDJPY higher as well.

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

As we head into the close, the EURUSD is trading near lows for the week.

The strong US jobs data today helped to push the pair below a swing area between 1.1001 and 1.1014, and also the 50% midpoint of the move up from the August 1 low at 1.0995. That area will now be close resistance going into the new trading week.

On the downside, the 61.8% retracement of the same move higher comes in at 1.0944. That is within a swing area going back to July 17 between 1.09419 and 1.0949. That will be a key bias-defining level for next week’s traders on the downside. Move below it, and then its 100-day moving average at 1.0928, and traders would then look toward the 200-day moving average of 1.08738 (and moving higher).

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

• Chinese Commerce Ministry releases statement after EU vote on tariffs on China-made electric vehicles.
• Chinese Commerce Ministry, after EU vote on EV tariffs: China firmly opposes EU’s ‚unfair‘, ’non-compliant‘, ‚unreasonable‘ protectionist practices.
• Chinese Commerce Ministry, after EU vote on EV tariffs: ‚Protectionist practices‘ of EU seriously violate rules of WTO.
• Chinese Commerce Ministry, after EU vote on EV tariffs: EU practices disrupt normal international trade order, hinder China-EU trade and investment cooperation.

This article was written by Arno V Venter at www.forexlive.com.

• Chinese Chamber of Commerce in EU releases statement after EU vote on tariffs on China-made electric vehicles.
• Chinese Chamber of Commerce in EU: Urges EU to act prudently, delay implementation of tariffs, avoid escalation of trade frictions.
• Chinese Chamber of Commerce in EU: Expresses strong dissatisfaction with EU for promoting ‚trade protectionism‘ measures.

This article was written by Arno V Venter at www.forexlive.com.

• ECB’s De Guindos: By end of 2025 ECB expects inflation and core inflation to hover around 2%, but too early to declare victory in fight against inflation.
• ECB’s De Guindos: Recent inflation data have been good, represented a positive surprise, but growth still reflects risks to the downside.
• ECB’s De Guindos: In general ECB is in favour of cross-border consolidation in the Euro Zone.

This article was written by Arno V Venter at www.forexlive.com.

Fundamental
Overview

Crude oil rallied strongly
on Tuesday following the first news of an imminent missile
attack from Iran against Israel. We had also the US
ISM Manufacturing PMI release with the new orders index ticking higher in a
potentially first sign of an improvement in demand.

Yesterday, crude oil
extended the gains as we got the news that Israel could target Iran’s oil infrastructure
in a potential retaliation. That also triggered a breakout of a key resistance
which increased the bullish momentum.

In the big picture, central
bank easing generally leads the manufacturing cycle, so we can expect global
growth to pick up, especially after the Fed’s 50 bps cut and the Chinese
officials surprising with strong easing measures.

All these reasons should be
bullish for the market and support prices in the next months barring a
recession. As a reminder, the positioning in crude oil is at record lows and
the sentiment is still very bearish. These factors can generally offer great
contrarian opportunities when we get to an inflection point in the
fundamentals.

Crude Oil
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that crude oil finally broke above the key 71.67 resistance and extended the rally into the major
trendline
where we can also find the 61.8% Fibonacci
retracement level for confluence.

This is where we can expect
the sellers to step in with a defined risk above the trendline to position for
a drop back into the 71.67 level, while the buyers will want to see the price
breaking higher to increase the bullish bets into the 80.00 handle.

Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we have now a minor upward trendline defining the current bullish
momentum. If the price were to pull back, we can expect the buyers to lean on
the trendline to position for new highs, while the sellers will look for a
break lower to increase the bearish bets into the 65.00 handle.

Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see more clearly the recent price action with the major spikes higher triggered
by the Israel and Iran tensions. There’s not much else we can add here as the buyers
will look for a bounce around the trendline or a break above the 75 handle,
while the sellers will want to see a stronger rejection and a break below the
minor upward trendline. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we conclude the week with the US NFP report where the consensus sees
140K jobs added and the unemployment rate to remain unchanged at 4.2%.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

EU Moves Forward with Tariffs on Chinese EVs Following Member Vote

Full Story on PiQ Suite

The European Commission announced it has secured enough support to impose tariffs of up to 45% on imports of Chinese-made electric vehicles, marking a significant trade decision that could provoke retaliation from Beijing.

The tariffs, aimed at countering what the EU considers unfair Chinese subsidies, will be in place for the next five years following a year-long anti-subsidy investigation.

In the vote, 10 EU members supported the tariffs, while five opposed and 12 abstained.

This article was written by Ryan Paisey at www.forexlive.com.