Fundamental
Overview

Bitcoin has been rallying
steadily in the last few weeks as Trump winning odds continued to soar in
betting markets. The price eventually consolidated around a key trendline as
the market might want to wait for the election result now before breaking out.

A Trump victory is seen as
bullish for Bitcoin given his embracement of the crypto industry and promised de-regulation.
Harris, on the other hand, did embraced the industry as well, but it’s been
more of a political move to attract voters rather than a strong support.

Bitcoin
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that Bitcoin is trading near a key long term downward trendline
that’s been defining the consolidation that started in March. The buyers will
want to see the price breaking higher to increase the bullish bets into a new
all-time high, while the sellers will likely lean on it to position for a
pullback into the upward minor trendline.

Bitcoin Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that the price is consolidating around the highs as the market is probably waiting
for the US election result. From a risk management perspective, the buyers will
have a better risk to reward setup around the minor upward trendline where they
will also find the Fibonacci
retracement levels for confluence.
The sellers, on the other hand, will want to see the price breaking below the trendline
to increase the bearish bets into new lows.

Bitcoin Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we have another minor upward trendline defining the bullish momentum
on this timeframe. The buyers will likely keep on leaning on it to position for
further upside, while the sellers will look for a break lower to increase the
bearish bets into the major upward trendline around the 64K level. The red
lines define the average daily range for today.

Upcoming
Catalysts

Tomorrow we have the US Job Openings and the US Consumer Confidence report. On
Wednesday, we get the US ADP and the US GDP. On Thursday, we have the US PCE,
the US Jobless Claims and the US Employment Cost Index data. Finally, on
Friday, we conclude the week with the US NFP and the US ISM Manufacturing PMI.

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

UPCOMING
EVENTS:

• Tuesday: Japan Unemployment Rate, US Job Openings, US
  Consumer Confidence.
• Wednesday: UK Budget, Australia Q3 CPI, Germany CPI, Eurozone
  Q3 GDP, US ADP, US Q3 GDP.
• Thursday: Japan Industrial Production and Retail Sales,
  Australia Retail Sales, China PMIs, BoJ Policy Decision, Switzerland
  Retail Sales, French CPI, Eurozone Flash CPI, Eurozone Unemployment Rate,
  Canada GDP, US PCE, US Jobless Claims, US ECI.
• Friday: Australia PPI, China Caixin Manufacturing PMI,
  Switzerland CPI, Switzerland Manufacturing PMI, US NFP, Canada
  Manufacturing PMI, US ISM Manufacturing PM.

Tuesday

The US Job
Openings is expected at 7.990M vs. 8.040M prior. The last report surprised to the upside with the quits rate ticking
slightly lower and the hiring and layoffs rates remaining stable. It’s a labour
market where at the moment it’s hard to find a job but there’s also low risk of
losing one.

The US Consumer
Confidence is expected at 99.3 vs. 98.7 prior. The last report surprised with a big miss. Dana M. Peterson, Chief
Economist at The Conference Board said: “Consumer confidence dropped in
September to near the bottom of the narrow range that has prevailed over the
past two years. September’s decline was the largest since August 2021 and all
five components of the index deteriorated.”

“Consumers’
assessments of current business conditions turned negative while views of the
current labour market situation softened further. Consumers were also more
pessimistic about future labour market conditions and less positive about
future business conditions and future income.”

“The deterioration
across the Index’s main components likely reflected consumers concerns about
the labour market and reactions to fewer hours, slower payroll increases, fewer
job openings—even if the labour market remains quite healthy, with low unemployment,
few layoffs and elevated wages.”

“The proportion of
consumers anticipating a recession over the next 12 months remained low but
there was a slight uptick in the percentage of consumers believing the economy
was already in recession.” Watch also the Present Situation Index as it generally leads the Unemployment Rate.

Wednesday

The Australian Q3
CPI Y/Y is expected at 2.9% vs. 3.8% prior, while the Q/Q measure is seen at
0.3% vs. 1.0% prior. The RBA though is focused on the underlying inflation
measures, so the Trimmed Mean figure will be the one to watch. The Trimmed Mean
CPI Y/Y is expected at 3.5% vs. 3.9% prior, while the Q/Q measure is seen at
0.7% vs. 0.8% prior.

As a reminder, the
RBA delivered a slightly less hawkish hold at the last policy decision, which
is a tiny move towards a more dovish stance, although they don’t see inflation
returning to target for another year or two.

The US ADP is
expected to show 115K jobs added in October vs. 143K in September. The last report surprised to the upside triggering a hawkish
repricing in interest rates expectations. Although the ADP has a poor track
record in predicting the NFP data, the recent market’s sensitivity to labour
market data makes it a bit more important.

Thursday

The BoJ is
expected to keep interest rates unchanged. The central bank toned down its
hawkish stance since the last policy decision and the economic data has yet to
show inflationary threats. Therefore, it’s unlikely that we will see a rate
hike anytime soon and the JPY faith will be shaped by what happens in the US in
the next two weeks.

The Eurozone Flash
CPI Y/Y is expected at 1.9% vs. 1.7% prior, while the Core CPI Y/Y is seen at
2.6% vs. 2.7% prior. The market’s pricing is already very dovish for the ECB,
so we will likely need a very soft report to see the market price in some more
easing.

A hot report
though will likely take off the table the 16% probability of a 50 bps cut in
December. We will also see the Eurozone Unemployment Rate which is expected to
remain unchanged at 6.4%.

The US PCE Y/Y is
expected at 2.1% vs. 2.2% prior, while the M/M measure is seen at 0.2% vs. 0.1%
prior. The Core PCE Y/Y is expected at 2.6% vs. 2.7% prior, while the M/M
figure is seen at 0.3% vs. 0.1% prior.

Forecasters can
reliably estimate the PCE once the CPI and PPI are out, so the market already
knows what to expect. Besides, this report won’t change anything for the
Fed as they are going to cut by 25 bps at the November meeting no matter what.

The market’s
focus is now on the US election.

The US Jobless
Claims continues to be one of the most important releases to follow every week
as it’s a timelier indicator on the state of the labour market.

Initial Claims
remain inside the 200K-260K range created since 2022, while Continuing Claims
after an improvement in the last two months, spiked to the cycle highs in the
last couple of weeks due to distortions coming from hurricanes and strikes.

This week Initial
Claims are expected at 233K vs. 227K prior, while Continuing Claims are seen at
1880K vs. 1897K prior.

The US Q3
Employment Cost Index (ECI) is expected at 0.9% vs. 0.9% prior. This is the
most comprehensive measure of labour costs, but unfortunately, it’s not as
timely as the Average Hourly Earnings data. The Fed though watches this
indicator closely.

Although wage
growth remains high by historical standards, it’s been easing for the past two
years, and it’s expected to continue to do so given the fall in the job quit
rate.

Friday

The Swiss CPI Y/Y
is expected at 0.8% vs. 0.8% prior, while the M/M measure is seen at 0.0% vs.
-0.3% prior. Although inflation in Switzerland has been within the SNB’s 0-2%
target for more than a year, it keeps on falling steadily with the Core measure
standing around 1% now.

The market is
pricing at 27% chance of a 50 bps cut in December and a soft report will likely
raise those probabilities to roughly 50%. The central bank mentioned that the
CHF strength has been a major drag on inflation but hasn’t taken any real
action to address this problem yet.

The US NFP is
expected to show 123K jobs added in October vs. 254K in September and the
Unemployment Rate to remain unchanged at 4.1%. The Average Hourly Earnings Y/Y
is expected at 4.0% vs. 4.0% prior, while the M/M measure is seen at 0.3% vs.
0.4% prior.

This is going to
be a tricky report given the distortions from hurricanes and strikes in
October. Thankfully, the market is unlikely to care that much given the focus
on the US election.

The US ISM
Manufacturing PMI is expected at 47.6 vs. 47.2 prior. The New Orders index
should be the one to watch as it should be the first to respond to the recent
developments. The latest S&P Global Manufacturing PMI improved a little with new orders ticking higher
albeit remaining in contractionary territory.

Businesses
continue to mention uncertainty around the US election, so you can see why the
market is so much focused on it. Although the data will still have an
impact this week, everything hinges on the US election.

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

• US UMich October final consumer sentiment 70.5 vs 69.0 expected
• US September durable goods orders -0.8% versus -1.0% expected
• Canada August retail sales +0.4% vs +0.5% expected
• Canada Sept new housing price index 0.0% vs 0.0% prior
• Baker Hughes US oil rig count -2
• BOC Macklem: If population grows slows more than assumed, headline GDP will be lower
• CNN: Trump 47%. Harris 47%. It’s a horse race.
• Nvidia is once again the world’s most-valuable company
• Atlanta Fed Q3 GDPNow 3.3% vs 3.4% prior
• ECB’s Lagarde: Disinflation process is well on track

Markets:

• Gold up $8 to $2743
• US 10-year yields up 3.6 bps to 4.23%
• WTI crude oil up $1.43 to $71.63
• S&P 500 flat
• USD leads, NZD lags

The mood steadily soured throughout US trade and NZD and AUD finished at the lows. The S&P 500 rose as much as 50 points but gave it all back to finish flat.

There wasn’t a catalyst for the change in mood that saw steady US dollar buying and bond selling. Perhaps it’s angst about the election of something happening in the Middle East on the weekend. It’s the time in the election cycle when there is often a big surprise and nerves are frayed.

The shape of the move was steady and most pairs grinded lower against the dollar, including the uro which slid to 1.0795 from 1.0835.

A winner on the day was gold, which finished at the best levels and climbed $25 from the lows despite the dollar strength. It’s had an impressive run, hit a record high earlier int the week and today’s close will be the best weekly close ever.

Crude also bucked the trend in risk assets, perhaps in a sign of Middle East worries or position squaring. It rose more than $1 in US trading including a curious spike late just before midday.

USD/CAD finished at its highest since early August and the highest weekly close since 2020 in the fourth weekly decline. A series of highs over the past two years stretch up to 1.3975 but those are now within striking distance in what could be a major break.

In contrast, AUD/USD finished at the lowest since August but has 400 pips of breathing room before the post-pandemic lows. That pair could be in focus in the weeks ahead if China delivers on the fiscal side of stimulus or disappoints.

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

A strong gap higher at the open quickly turned into a day of disappointment for bulls. After surging nearly 50 points in early trading to hit 5860, sellers stepped in and methodically unwound those gains throughout the session. The late morning and early afternoon saw particularly steady selling pressure, though buyers did attempt to defend the 5820 level multiple times. A late-day drift lower saw the index ultimately close down just 2 points, a round trip that essentially erased virtually all of the day’s moves.

The weak close despite the strong open could be a warning sign for bulls heading into next week’s trading.

• S&P 500 flat
• NASDAQ Comp +0.6%
• Russell 2000 -0.5%
• Dow Jones Industrial Average -0.6%

On the week:

• S&P 500 -1.0%
• NASDAQ Comp +0.2%
• Russell 2000 -3.0%

This week’s decline in the S&P 500 breaks a six-week winning streak.

Next week is a huge one for the stock market with 5 of the Mag 7 reporting.

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

The New York Times released a poll today showing Trump and Harris deadlocked. That’s bad news for the Harris campaign as she had previously been leading. Combined with betting odds shifting in Trump’s favor and it’s starting to feel like we’ve hit a tipping point.

The bond market has been selling off steadily today, which reads like a Trump trade. At the same time, the stock market has been selling off steadily after opening higher and is down on the week.

So what gives? Surely there are some people making election bets but real money knows better. Elections are very tough to predict.

I think we all remember the polling errors in 2016 and 2020 but here is a reminder from Bespoke of what the polls looked like in 2012, which ended up being a 4-point win for Obama and 332-206 in the electoral college.

The kicker here is that betting markets had Obama as a decided favorite, even in the final week as the polls tightened. Right now, betting sites are at about 60:40 for Trump.

As I often say: There is always another trade. Politics and betting on binary outcomes is a tough way to make money in markets. All the best trades on the election are going to be after the results are clear, just like in the last two elections.

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

The Fed blackout starts at midnight but the week ahead is packed with market-moving data, decisions and earnings reports.

Here’s a day-by-day preview of the week ahead:

MONDAY, OCTOBER 28

• US data: Dallas Fed manufacturing activity
• UK: Lloyds Business Barometer
• Japan: Jobless rate, job-to-applicant ratio
• ECB’s Wunsch speaks
• Earnings: Ford, Waste Management
• US Treasury Quarterly borrowing estimates, 2yr ($69bn) and 5yr ($70bn) note auctions

TUESDAY, OCTOBER 29:

• US: JOLTS job openings, Conference Board consumer confidence (98.7 prior)
• UK: Consumer credit, M4 money supply
• Germany: GfK consumer confidence
• Tech earnings: Alphabet (Google), AMD
• Others: McDonald’s, Pfizer, BP, Visa, PayPal

WEDNESDAY, OCTOBER 30

Big data day:

• US: Q3 GDP first reading, ADP employment
• Eurozone: Q3 GDP
• Germany: CPI, Q3 GDP
• France: Q3 GDP
• Australia: Q3 CPI
• Tech earnings: Microsoft, Meta
• Others: Boeing, Volkswagen, BASF
• UK Autumn Budget
• US Treasury quarterly refunding announcement

THURSDAY, OCTOBER 31

• Bank of Japan policy decision
• US: PCE inflation (core seen +0.28% MoM)
• Eurozone: CPI, unemployment
• China: Official PMIs
• Heavyweight earnings: Apple, Amazon, Intel, Samsung
• Energy: Shell, TotalEnergies, ConocoPhillips
• Others: Mastercard, Merck

FRIDAY, NOVEMBER 1

• US: Nonfarm payrolls (some forecasts as low as 0K, consensus at +123K), ISM manufacturing
• China: Caixin manufacturing PMI
• Switzerland: CPI
• Earnings: Exxon Mobil, Chevron

The week’s big focus will be on the US jobs report Friday, but markets will have plenty to digest before then with Q3 GDP, inflation data, and massive tech earnings. With five of the „Magnificent 7“ reporting (representing $12 trillion in market cap), expect some volatility in equity and currency markets throughout the week.

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

• Having returned to low inflation, Canada is in a better place to deal with new economic shocks
• There’s a fair amount of uncertainty on how quickly Canada’s new immigration curbs kick in, BOC will be watching
• Effect of changes in assumptions about population growth will have a bigger impact on our GDP forecast that our inflation forecast
• If population growth slows faster than assumed, headline GDP will be lower than assumed

The Canadian government announced 20% lower immigration targets yesterday.

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

With the drop today, gold is down 0.1% on the week and looks to end its latest weekly winning streak at two. There’s still US trading to follow later though but there are a couple of things to note with the latest decline here. On the daily chart, it might not seem like much:

That as price action continues to hold above the $2,700 mark and not really threatening a test of the figure level yet. But when you switch over to the near-term chart, there is a notable development amid the push and pull this week:

The drop today sees price action fall back below its 100-hour moving average (red line). And that puts the near-term bias in gold to being more neutral now. The 200-hour moving average (blue line) now returns to focus as a key near-term support as such. And that level is seen at around $2,707 currently.

With little else happening in broader markets today, some tentative signs of exhaustion in gold is perhaps something to keep an eye out for. As mentioned earlier in the week:

„At this point, it seems to be a case of it (a squeeze) will come when it comes. As stated earlier this month, I’m running out of reasons for one presently.

The case for gold to move higher has been clear and concise since the end of last year. And that has continued well into this year as well, as seen here.

All that being said, this may arguably be the trickiest time period for gold as we approach year-end. The December and January seasonal rush is one that typically benefits gold considerably during the turn of the year. So, if there’s ever a time for profit taking, this may be the stretch to watch out for.

Otherwise, it can be tough to challenge the gold narrative in the next few months.“

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

Fundamental
Overview

It looks like the market is
taking some breather after an incredible rally in the US Dollar. This week was
pretty empty on the data front, and we haven’t got any meaningful catalyst. The
main culprit for the US Dollar strength has been the rally in long term
Treasury yields.

The yield curve has been
bear-flattening which is what you would expect with higher growth and
potentially higher inflation expectations. There’s been a good argument that
the markets have been already positioning for a Trump victory which is expected
to strengthen the higher growth and less rate cuts expectations.

For now, this is the trend
and it’s generally a bad idea to fight such trends without a strong catalyst.
Unfortunately, we don’t have much left for October as the main events will be
in the first weeks of November when we will get the top tier economic reports,
the US elections and the FOMC decision.

On the AUD side, the latest
data has been pretty strong with the Australian labour market report last week beating expectations by a
big margin. Although it didn’t change much in terms of interest rate
expectations, it reinforces the RBA’s hawkish stance.

AUDUSD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that AUDUSD is bouncing from the key swing level at 0.6622. This is where
the buyers are stepping in with a defined risk below the level to position for
a rally into the 0.68 handle. The sellers, on the other hand, will want to see
the price breaking lower to increase the bearish bets into the 0.65 handle
next.

AUDUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we have a strong resistance
level at 0.6660 where we can also find the trendline
for confluence.
If we get a pullback into the resistance, we can expect the sellers to step in
with a defined risk above the level to position for the break below the 0.6622
support. The buyers, on the other hand, will want to see the price breaking
higher to increase the bullish bets into the 0.68 handle.

AUDUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see more clearly the recent price action with the several rejections from the
0.6622 support as the sellers have been struggling to break through. There’s
not much more we can add as the sellers will look to short from the trendline
or on a break lower, while the buyers will want to see the price breaking the
resistance to increase the bullish bets into new highs. The red lines define
the average daily range for today.

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

This is more or less what happens when market players don’t get their fix. It’s all about economic data these days and there hasn’t been any ones this week that stood out. The focus turned towards the bond market and rising yields but even that has cooled off in the past few sessions. 10-year Treasury yields are flat today at 4.202% currently. As such, currency traders are not finding much appetite on the day as well.

Dollar pairs are little changed for the most part with just some light extension to the narrow ranges in European morning trade.

USD/JPY is nudging back towards 152.00 after a fall in the handover from Asia, with the 100-hour moving average being defended at around 151.45 at the time. The 200-day moving average at 151.40 is also providing some extra support on the daily chart for now.

Besides that, there’s not much else with most other major currencies keeping more muted. Equities are just a touch higher on the day but as a whole this week are still holding lower. US futures are up by 0.2% though and that might invite some interest from Wall Street to try and salvage something on the week before the weekend break.

In terms of data releases, there is the Canadian retail sales to look out for later. After that, it’ll be a bit of a wait again until we get to the US JOLTS job openings on Tuesday. As for other key risk events, just be mindful of the Japanese elections this weekend.

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