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Market Overview
Macro & Geopolitics
Strong US economic activity data is putting renewed pressure on the bond market. September's preliminary indicators point to a resilient economy, while a sharp rise in company costs has heightened inflation concerns. This outlook is pushing bond yields higher while reinforcing expectations for an additional Fed rate hike.
In Europe, economic activity running stronger than expected and an increase in new orders show that the economy is remaining resilient against the energy shock. However, the pass-through of rising costs into prices is supporting expectations for additional ECB tightening.
Strong US data and rising bond yields are supporting the dollar while potentially pressuring risk assets. In contrast, resilience in the Eurozone is supportive for the euro, while the renewed rise in oil prices is keeping inflation expectations alive, which could increase volatility across bond, currency, and precious metal markets.
Today's Economic Calendar (GMT)
| Time | Ccy | Event | Fcst | Prev |
|---|---|---|---|---|
| 12:30 | USD | Initial Jobless Claims | 201K | 196K |
| 12:30 | USD | Continuing Jobless Claims | 1.750K | 1.730K |
EUR/USD · FX Major
The Eurozone posting its strongest increase in economic activity in over three years, together with an acceleration in new orders, points to the economy remaining resilient despite the energy shock, which is supporting the euro.
Continued cost pressures in the PMI data could reinforce expectations for a fresh ECB rate hike. This outlook is supportive for the euro, while the risk of high financing costs weighing on growth going forward remains an important consideration.
The 1.1410 level stands as the first key resistance zone for the pair, while 1.1350 can be followed as the first support point on any pullback.
| Resistance | Support |
|---|---|
| 1.1410 | 1.1350 |
| 1.1440 | 1.1320 |
| 1.1470 | 1.1290 |
GBP/USD · FX Major
A slowdown in UK services sector activity and a decline in the composite PMI point to weakness in the growth outlook. In contrast, an acceleration in companies' price increases shows that low growth and high inflation pressure are persisting side by side.
A recovery on the manufacturing side is providing limited support to the economy, while overall growth weakness could narrow the BoE's room for further rate hikes. This outlook could lead to more cautious pricing for sterling.
Should the pair maintain its upward trajectory, the 1.3260 level stands out as a strong resistance, while 1.3220 can be followed as the first key support zone on any downside moves.
| Resistance | Support |
|---|---|
| 1.3260 | 1.3220 |
| 1.3290 | 1.3200 |
| 1.3310 | 1.3180 |
XAU/USD · Metal
Hawkish messaging from Fed officials is increasing pressure on gold. Assessments that energy-driven inflation could become more persistent, together with Fed members' comments supporting further rate hikes, are reinforcing expectations that a high-rate environment could continue. The accompanying strong dollar is also limiting gold's upside.
On the geopolitical side, continued US-Iran tension remains a factor that could support safe-haven demand. An escalation in tension could boost demand for gold, while in the current outlook the high-rate and strong-dollar theme continues to be more decisive for pricing.
Technically, the 4310 level stands as the first key resistance, while 4250 can be followed as the first support point on any pullback.| Resistance | Support |
|---|---|
| 4310 | 4250 |
| 4340 | 4220 |
| 4370 | 4190 |
XAG/USD · Metal
The US economy maintaining its strong pace, together with hawkish Fed messaging, is putting pressure on silver. Assessments that inflation is spreading beyond energy and tariffs are reinforcing expectations that rates could stay higher for longer.
This outlook is supporting US bond yields and the dollar, while potentially limiting investment demand for non-yielding silver. In particular, a continued rise in bond yields could keep pressure on silver.
The $66 level stands as the first key resistance, while $62 can be followed as the first support point on any pullback.
| Resistance | Support |
|---|---|
| $66 | $62 |
| $68 | $60 |
| $70 | $58 |
Brent Oil · Energy
The US working with Gulf countries on new energy infrastructure and alternative transport routes to reduce dependency on the Strait of Hormuz stands out as a development that could reduce regional supply risks over the medium term. The plan does not resolve short-term supply issues but could reduce energy trade's dependency on Hormuz.
In Asia, India reducing its imports of Russian oil and shifting supply toward the Middle East and the spot market points to a shift in global oil flows. This trend could reduce demand for Russian oil while boosting demand for Gulf producers, potentially reshaping regional supply balances.
The $100 level stands as the first key resistance, while $95 can be followed as the first support point on any pullback.
| Resistance | Support |
|---|---|
| $100 | $95 |
| $103 | $92 |
| $105 | $89 |
Bitcoin · Crypto
Bitcoin's recent rally being dependent on large capital inflows and ETF demand is raising questions about the sustainability of the move. A weakening in ETF inflows leading to a faster increase in selling pressure in the crypto market stands out as a significant risk.
On the macro side, bond yields climbing again on strong US data could pressure Bitcoin. Higher yields tightening financial conditions could reduce the appeal of risk assets, while broad-based buying in the crypto market signals that investor demand has not yet significantly deteriorated.
The 87K level stands as the first key resistance, while 82K can be followed as the first support point on any pullback.
| Resistance | Support |
|---|---|
| 87K | 82K |
| 89K | 80K |
| 91K | 78K |
