AUD/JPY stalled at a previous high of 81.312 for the third time today. The cross has traded in a 77.897-82.028 range since July. 

AUDJPY D1 10 07 2021 1504

 

The price is above the 20-day, 50-day and 200-day simple moving averages (EMAs), which might normally be bullish. However, the 50-day EMA is above the 20-day EMA and the gradient of both lines is yet to turn positive. These factors may put bullish momentum in question.

Resistance could remain at the recent high of 81.312 and a previous top at 82.028. On the downside, support might be provided by lows at 80.009, 78.846 and 77.897.

 


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U.S. stocks plummeted at the start of the week, dragged by technology shares, as the recent rise in Treasury yields led investors to flee high-flying companies. At the same time, concerns about the debt ceiling, persistently elevated inflation, fresh U.S.-China trade worries and the possibility of higher corporate taxes also weighed on sentiment.

When it was all said and done, the Nasdaq 100 plunged 2.16% to 14472, losing its 100-day moving average, pulled lower by outsize losses in mega-caps such as Amazon, Microsoft, and Apple. Meanwhile, Facebook, the fifth most valuable company, was hit the hardest, dropping almost 5%, after an insider whistleblower accused the social media company of facing no oversight, betraying democracy, and choosing profits over public safety.
With stretched and frothy valuations, the technology sector faces several near-term risks, but one of the main threatsappears to stem from the prospect of tighter monetary policy as the Fed prepares to taper its asset purchase program, a process that could start as soon as next month (November). 

NAS100 D1 10 05 2021 1035

 

After breaking below its 100-day simple moving average on Monday, the Nasdaq 100 has fallen rapidly towards support in the 14365 area. If sellers manage to breach this floor in the next few trading sessions, the tech index could retreat towards cluster support in the 13950 region. On the flip side, if bulls reassert upside pressure and prices manage to pivot higher, the first resistance appears near 14775. Should buyers reclaim this level, there could be scope for a move towards 15150.

 

The FTSE 100 is making a strong comeback these days after hitting the bottom of a multi-month range and the 200-day moving average. The spring back has in focus a trend-line running lower from the January 2020 high created just before the pandemic roiled markets.

In confluence with this trend-line, and perhaps more importantly, is the top-end of the range that has been developing since June. The two combined could create a ceiling that proves too difficult to climb through, at least on an initial attempt. 

UK100 D1 09 30 2021 2316

 

A turnabout in momentum after thoroughly testing resistance from around 7172 up to 7225 could provide a decent risk/reward opportunity for those looking to play for a continuation of range conditions. A quick turn lower looks likely, at the least.

Momentum pick up as resistance comes into play, then perhaps we will see a breakout scenario unfold. It would take a daily and maybe even a weekly close outside the range to garner further interest from the long-side of the tape.

For now, risk/reward from either side of the tape doesn’t appear favorable until we see how resistance is handled.

 

GBP/USD is struggling to break above a key level despite continued support from buyers. The pair has managed to stage a good comeback since last Thursday as the US Dollar has come off slightly from its impressive rally last week but there isn’t a clear path higher as resistance looms close by.

The area between 1.3577 from the February 2021 highs and the 1.36 mark is the key challenge up ahead and with a lack of data on the calendar for today’s session and a pretty quiet start to the week in markets we could expect GBP/USD to remain around current levels throughout the day, with possible sideways consolidation in the coming sessions. Last week’s bounce does seem to have gotten a bit ahead of itself and with the pair trading below its key moving averages, the short-term buying momentum seems to be pressured.

GBPUSD D1 10 04 2021 1229

 

The calendar is pretty weak for the UK this week with only some PMI data coming out over the next few days. The focus will be on the jobs data for the US on Friday, which has had a lot of emphases put on it as the Fed has signaled that a strong reading would likely lead to the start of monetary tightening in its November FOMC meeting. The data will also draw a lot of attention as fears of stagflation have started to mount, with a strong jobs reading likely pushing back those fears about growth stagnating anytime soon. 

 

 

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EUR/USD attempts to halt a five day decline as the Federal Reserve sticks to the sidelines, and the exchange rate may stage a larger recovery over the remainder of the month as it appears to be reversing ahead of the yearly low (1.1664).
EUR/USD bounces back from a fresh monthly low (1.1684) as the Federal Open Market Committee (FOMC) retains the current course for monetary policy, and the lack of urgency to taper the quantitative easing (QE) program may continue to produce headwinds for the US Dollar as market participants push out bets for higher interest rates.


Looking ahead, it remains to be seen if the federal election in Germany will sway EUR/USD as the European Central Bank (ECB) plans to carry out “a moderately lower pace of net asset purchases under the pandemic emergency purchase programme (PEPP) than in the previous two quarters,” but it seems as though the Governing Council will continue to utilize its emergency tools throughout the remainder of the year as “there remains some way to go before the damage to the economy caused by the pandemic is overcome.” 

EURUSD D1 09 23 2021 2305

 

EUR/USD sits below 1.1980 for the first time since April as the advance from the March low (1.1704) failed to produce a test of the January high (1.2350), with the exchange rate trading to a fresh yearly low (1.1664) in August as the 50-Day SMA (1.1786) established a negative slope.
EUR/USD may trade within a defined range as it appears to be reversing ahead of the yearly low (1.1664), with lack of momentum to push below1.1670  to 1.1710  bringing the 1.1780 to 1.1810  region back on the radar.
Need a break above the July high (1.1909) to open up the 1.1950  to 1.1970 region, with a move above 1.1980 opening up the overlap around 1.2080 to 1.2140.

 

 

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