Fundamental
Overview

The US Dollar is now lower
across the board as the market erased most of the greenback’s gains following
Trump’s victory. This has been a puzzling reaction as Trump’s policies are
likely to spur growth and potentially end the Fed’s easing cycle earlier than
expected.

We can argue that the
market was already positioned for a Trump’s victory as we saw the greenback
rallying for a couple of weeks leading into the US election. So, this might
just be a “sell the fact” reaction and the market might now need more to keep
bidding the USD.

Another possible
explanation is that the market is more focused on global growth now and that’s
generally bearish for the greenback. We saw something similar in 2016 when the
USD rallied strongly once Trump got elected but after a couple of months, it went
into a 2-year long downtrend.

The Fed for now remains
neutral and on track to keep cutting rates. Yesterday, they cut by 25 bps as expected and given the overall neutral
message, the market expects another 25 bps cut in December. Strong data from
now until the December meeting though could change their plans for 2025.

We have the US CPI report
next week and that’s going to be a test. If the US Dollar sells off on hot
data, then the market might be indeed focusing on global growth rather than the
potential for an earlier pause in the Fed’s easing cycle.

USDCHF
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that USDCHF couldn’t extend the rally above the key resistance zone around the 0.8730 level. We now
have an upward trendline
defining the bullish momentum. We can expect the buyers to lean on it to
position for a rally into new highs, while the sellers will look for a break lower
to increase the bearish bets into new lows.

USDCHF Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we have a minor support around the 0.87 handle. The buyers will likely
step in there with a defined risk below it to target new highs, while the
sellers will look for a break lower to increase the bearish bets into the major
trendline.

USDCHF Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, there’s
not much to add here as the buyers will look for a bounce around the 0.87
handle, while the sellers will look for a break. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we conclude the week with the University of Michigan Consumer Sentiment
report.

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

Fundamental
Overview

The Nasdaq tested the
all-time high following Trump’s victory and the red sweep as the market started
to look forward to bullish drivers like tax cuts and deregulation.

One potential bearish
reason people are looking at is rising Treasury yields. That’s generally
bearish when the Fed is tightening though as the market looks forward to an
economic slowdown.

Right now, the Fed’s
reaction function is that a strong economy would warrant an earlier pause in
the easing cycle and not a tightening. That should still be supportive for the
stock market.

If the Fed’s reaction
function changes to a potential tightening, then that will likely see the stock
market correcting lower.

Nasdaq
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that the Nasdaq bounced on the trendline and extended the rally into the
all-time high following Trump’s victory. The sellers will likely step in around
these levels with a defined risk above the all-time high to position for a drop
back into the trendline. The buyers, on the other hand, will want to see the
price breaking higher to increase the bullish bets into new highs.

Nasdaq Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see more clearly the incredible rally since the bounce on the trendline. The
price is now testing the all-time high with the Fed’s decision looming. The
momentum is strong but if we get a bearish reaction to the Fed’s decision in
the afternoon, the dip-buyers will likely step in around the 20700 level. The
sellers, on the other hand, will look for a break lower to target the
trendline.

Nasdaq Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that the strong bullish momentum on this timeframe is fading a bit as the price
broke below the minor upward trendline. This price action might signal a
pullback into the 20700 level. The red lines define the average daily range for today.

Upcoming Catalysts

Today we have the US Jobless Claims and the FOMC Policy Decision. Tomorrow,
we conclude the week with the University of Michigan Consumer Sentiment report.

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

Fundamental
Overview

The S&P 500 soared into
a new all-time high following Trump’s victory and the red sweep as the market
started to look forward to bullish drivers like tax cuts and deregulation.

One potential bearish
reason people are looking at is rising Treasury yields. That’s generally bearish
when the Fed is tightening though as the market looks forward to an economic
slowdown.

Right now, the Fed’s
reaction function is that a strong economy would warrant an earlier pause in
the easing cycle and not a tightening. That should still be supportive for the
stock market.

If the Fed’s reaction function
changes to a potential tightening, then that will likely see the stock market
correcting lower.

S&P 500
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that the S&P 500 bounced from the key support
zone around the 5720 level and extended the rally into a new all-time high
following Trump’s victory. The only technical level of note now is the resistance
turned support around the 5918 level.

If we get a pullback, we
can expect the buyers to step in there to position for a rally into new highs,
while the sellers will look for a break lower to start targeting the 5830 level
next.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see more clearly the support around the 5918 level on this timeframe where we
did get a bounce yesterday already. The momentum is strong but if we get a
bearish reaction to the Fed’s decision in the afternoon, the dip-buyers will
likely step in around that level to target new highs. The sellers, on the other
hand, will look for a break lower to target the 5830 level.

S&P 500 Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, there’s
not much we can add here although the price action here looks like the momentum
has slowed and we might get the pullback. The red lines define the average daily range for today

Upcoming
Catalysts

Today we have the US Jobless Claims and the FOMC Policy Decision. Tomorrow,
we conclude the week with the University of Michigan Consumer Sentiment report.

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

• Prior +0.2%; revised to +1.1%

Euro area retail sales grew by more than expected and that is on top of a sharp revision higher to the August figure. Looking at the details, food sales were down 0.4% but non-food store retail sales were up 1.1% with automotive fuel store sales up 0.2% on the month. That being said, all this is Q3 data and feeds into the overall picture here already.

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

Fundamental
Overview

The US Dollar rallied
across the board yesterday as Trump got elected President of the US. The
Republicans won also the Senate and the House giving us a red sweep and therefore
high chances of tax cuts.

This should be the most
bullish scenario for the greenback as it should lead to higher growth and less
rate cuts expectations.

In fact, given the red
sweep and the strong US data we keep on getting, the Fed might start to change
its stance, and we could see a much earlier than expected pause in 2025.

On the GBP side, we have
the BoE rate decision today where the central bank is expected to cut by 25 bps
with potentially 1 member voting for a hold and 2 members voting for a 50 bps
cut.

Looking ahead, the market
priced out the high chances of a back-to-back cut in December but if the data
were to worsen further, we might see the market pricing that back in.

GBPUSD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that GBPUSD bounced from the recent low around the 1.2843 level. This is
where the buyers are stepping in to position for a pullback into the 1.30
handle. The sellers, on the other hand, will want to see the price breaking lower
to increase the bearish bets into the 1.27 handle next.

GBPUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see more clearly the bounce from the recent low which is now a strong support
zone. There’s not much we can add here as we could get stuck in a range between
the 1.2843 support and the 1.3044 resistance. A breakout on either side should
lead to a more sustained trend.

GBPUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we have a minor counter-trendline
defining the current pullback on this timeframe. The buyers will likely keep on
leaning on the trendline to position for new highs, while the sellers will look
for a break lower to position for the break of the support zone. The red lines
define the average daily range for today.

Upcoming
Catalysts

Today we have the BoE Policy Decision, the US Jobless Claims and the FOMC
Policy Decision. Tomorrow, we conclude the week with the University of Michigan
Consumer Sentiment report.

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

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

That is the highest level in four months and carries on from the surging run since October. And this is in part fueling the dollar gains on the day with EUR/USD now down nearly 2% at 1.0715 and USD/JPY up 1.7% to 154.15 currently.

Trump’s domestic policies are largely aimed at boosting growth, spending and with regards to foreign trade, tariffs and trade conflicts are going to stir up some added drama. All of which markets are anticipating to feed into higher inflationary pressures in due time.

That is partly why there’s so much angst in bonds now but also if Trump digs into the fiscal checkbook i.e. more borrowing, it does put upward pressure on yields as well.

It’s still too early to judge the exact nature and magnitude of how Trump’s presidency will impact the above issues. But for traders, the considerations are definitely there already as evident in the bond market reaction we’re seeing.

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

The Associated Press has made their call and we’re seeing everyone else chime in with CBS, Fox, and CNN all making their calls as well. Even Edison Research and FiveThirtyEight are also now calling it for Trump. What is impressive is that it looks to be a clean sweep of all the swing states. That will see Trump end with 312 votes against Harris‘ 226 votes.

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

Fundamental
Overview

Gold is trading lower today
as Trump got elected President of the US. The Republicans won the Senate, and
they just need the House now to get a red sweep.

That is the most bearish
scenario for gold in the short-term as it would make the tax cuts easier to
pass which should lead to higher growth and less rate cuts expectations. As of
now, the probabilities are in favour of the Republicans.

Given the above and the
strong US data we keep on getting, the Fed might start to change its stance,
and we could see a much earlier than expected pause in 2025.

Gold
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that gold bounced near the major trendline as the buyers stepped in to
position for a rally into a new all-time high. The sellers, on the other hand,
will want to see the price breaking lower to increase the bearish bets into new
lows.

Gold Technical Analysis
– 4 hour Timeframe

On the 4 hour chart, we can
see that we now have a minor downward trendline defining the current bearish
momentum on this timeframe. The sellers will likely lean on the trendline to
position for the break below the major trendline. The buyers, on the other
hand, will want to see the price breaking higher to increase the bullish bets
into new highs.

Gold Technical Analysis
– 1 hour Timeframe

On the 1 hour chart, we can
see that the price bounced from the lower bound of the average daily range for today. We can also see that we
have a pretty strong resistance zone around the 2730 level now.

The sellers will likely
pile in around the resistance and the trendline to keep pushing
into new lows, while the buyers will look for a breakout to the upside to
invalidate the bearish setup and increase the bullish bets into a new all-time
high.

Upcoming Catalysts

Tomorrow we have the US Jobless Claims and the FOMC Policy Decision. On Friday,
we conclude the week with the University of Michigan Consumer Sentiment report.

See the video below

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

• Prior +0.6%

Looking at the details, most of the drop comes from energy prices (-1.9%). If you strip that out, producer prices were actually flat on the month in September. Breaking down the other components, there were rises in prices for durable consumer goods (+0.2%) and non-durable consumer goods (+0.2%). That is slightly offset by a drop in prices for capital goods (-0.1%) with intermediate goods keeping flat.

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