Monday Market Action

USDX: 94.85

Dollar Index was on Friday over the US payroll data release, initially spiking sharply lower, then recovering fast.

We saw a low around 94.00 before a sharp move back higher, seeing 95 as a possible near-term target.

The big story is the US payrolls missing expectations but still being quite strong.

USDX may trade in more restrained ranges this week ahead of next week’s US Inflation data release.

USD JPY: 114.65

Dollar-Yen spiked down to 113.60 over the US jobs data release, before heading north through the 114 handle again afterwards.

The BOJ tone today on the newswires helped to lift USDJPY higher through the key resistance at 114.50.

Can it reach for the stars and run above 115?
I think it can see and think it will be bid higher towards 115.50 potentially.

EUR USD: 1.1600

Euro spiked mildly higher but was capped at 1.1680 last week.

I called a move back to 1.1680 (as a ceiling) in the easyMarkets Weekly Outlook video last Monday, and that level looks like a hard resistance level, ahead of next week’s US CPI data release.

The slide back to 1.1600 is an ominous sign for the EUR against a strengthening USD.

I would have to favour a move back to 1.1500 for EURUSD now that the US payroll data is supportive enough for the December rate hike for the US Fed, hurting EURUSD bulls.

GBP USD: 1.3060

Sterling spiked higher as the markets saw the US payroll report as dollar-soft, initially at least.

Rates were raised by a 7-2 vote, lifting 25 Basis Points, but the inflation outlook and working for the next rate hikes were taken as Dovish, collapsing GBP very sharply.

The selloff Was fierce, and the only bounce was short-lived to 1.3130 on the NFP data release, before resuming the Downtrend again.

The 1.3000 level looks very likely in the coming weeks barring any super positive GBP Brexit headlines regarding (positive) progress.

AUD USD: 0.7645

The Aussie had a rough, rough week last week, taking out key supports under 77c.

The key 7730 level held up as a ceiling on the spike higher, before the downside resumed, as with the other major FX pairs against the Greenback.

RBA tomorrow – Likely to hold Australia’s benchmark rates steady & unchanged which may see another small uptick before a run lower.

Copper came back sharply off highs last week after its price rally fizzled out, but really the AUDUSD is all about the USD sentiment continuing to strengthen up, dragging our Aussie lower, now under the support at 7650.

NZD USD: 0.6905

The NZDUSD got a solid lift back up above 69c against the Greenback after the better-than-expected NZ Unemployment (improving to 4.6%) and soft open in the USD covering on Thursday.

The geopolitical risks to the NZD are large so this pair can get back towards 68c if the USD data is as strong as it is perceived to be.

The data was a slight miss but still, sellers may strep in at this level to nibble at NZD towards 6850.

The NZDUSD is likely to find Selling pressure again in the week ahead in my view.

I am looking for lower lows to be the theme, towards year end, as the US raise rates in December the Kiwi will come under increasing pressure, towards 6800.

USD CAD: 1.2765

Dollar-CAD took a hit lower to trade around 1.2720 briefly on the US jobs data release.

This was because the US payrolls were not quite the stellar 300K as projected, plus the Canadian jobs data was strong at the same time.

Over the mid-term it still looks a great trade to consolidate higher from here, heading closer towards the US rate hike next month.

In the short-term though, the Oil price rally will help support the CAD, and hold USDCAD around 1.2800.

VIX: 9.14

US Stocks are holding up firmly this week ahead of the hugely important Trump visit to Asia.

The Volatility Index is holding under 10 but lets see where it is end of November, as big moves are getting more and more likely by the day.

Look for a breakdown in stocks before year-end, possible a large correction in my view, particularly as profit-taking may kick in.

GOLD: $1,268

Gold had an expanded trading range to end last week, seeing 1283 (weekly) highs fall apart late in the US session.

Price action on Tuesday seems fair value to me, as we are staring at a LOT of uncertainty around the USD outlook/sentiment this coming week.

The sharp retracement back from 1280 to lows around 1265 is a sign of the times as USD strength continues to remain robust.

Expect a volatile fortnight ahead for GOLD as Donald Trump visits Japan, China & South Korea, where the North Korean issue may rare up once again.

Traders are looking ahead to the US CPI next Thursday, but expect the US to raise rates in December regardless, holding GOLD back to around 1250 to close off this year in my view potentially.

OIL (WTI): $55.60

After a move to $55 and a sharp retracement lower this week, Oil has found support once again.

The WTI price was Bid back up towards $56 and likely to carry on higher from my research.

Price action suggests that a new support base at $54 will help Oil prices lift again, towards $57 or higher before profit-taking kicks in.

There was Bullish price action to close off last week, as Oil takes on new territory with the Saudi Arabia chess moves going on.

BITCOIN (BTC): $7,365

Bitcoin ripped higher last week, seeing a new all-time high around $7,500 before a mild retreat.

The pullback/retreat was short-lived and the bullish upward momentum resumed, now holding above the $7300 area.

ETF for Bitcoin is also coming soon so my call of $7,500 by year-end is very much in play, after getting over the hurdle at $7000 last week.

The easyMarkets MetaTrader 4 platform now has Bitcoin, with Fixed Spreads and Guaranteed Stop Loss orders.

Also, visit the Dealer Insights Page for Russell Sandiford for a podcast where we talk the pros and cons of Bitcoin acceptance plus accurately calling the $7500 level.

The momentum has switched to be strongly bullish again but be careful because the upcoming Bitcoin fork is very likely to cause a jolt lower.

Get in touch with our Dealing desk for more insights & the upcoming Bitcoin Webinar, to secure your place.

Macro Themes in Play

• Oil lifts strongly above $55
• GBP Still under pressure in the aftermath of Bank of England
• USD Traders looking ahead to December rate hike after moderate US Payroll data.