Currencies
EUR/USD – reached the support around the 1.085 level before moving up again. The strong German data yesterday was only able to cause for a short upwards move before sliding down towards the support. The weaker US data (consumer confidence) however, was able to lift the EUR a bit and we closed at around the level reached after the German data.
USD/JPY – was trading up for a long time and midday, when there was an overall strengthening of the USD, we broke through the resistance around the 104.5 level and we were headed and eventually reached the next resistance just under the 105 level (around the 104.9 level). We can see that this is exactly where we stop and subsequently moved down, although we were able to close above the 104 level. This morning we are moving up again and are trading close to the resistance around the 104.5 level.
GBP/USD – moved down and is trading below the 1.22 level as the USD strengthening caused a sharp drop in the GBP. We are getting closer to the psychological 1.20 level which we could see tested in the coming days. The weaker US data yesterday was able to lift the GBP a little but from its lows, but this morning we are heading down again. We will be looking forward to the GDP data tomorrow out of the UK.
Indices
Nikkei 225 – is trading at a 6 month high after breaking through resistance around 17087 as the JPY keeps on weakening.
S&P 500 – started moving down when oil began to slide as well, and continued to do this after some weaker earnings reports, especially Apple (NASDAQ:AAPL) weighted on the S&P due to its weight on the index. We could be trading in a triangle, but for that to be the case we would need to find support on the upwards line, so that would be an interesting point to look at.
Commodities
Gold – with the USD weakening a bit, we could see gold move higher, also due to increased physical demand due to the Diwali in India. We can see that we are currently trading near the resistance around the 1276 level and at the highest level since the start of the month.
Natural Gas – we are able to see a nice long-term upwards trend line. With oil prices moving down, we can expect to see the same thing happening with natural gas, but it will be interesting to see if we are able to find support on the trend line again.
Oil – started to drop as Russia has said that it does not agree to cut production and thus will not join OPEC, and production out of Nigeria is on the rise. In addition, the fact that Iraq is trying to get out of cutting production is creating serious doubts on the agreement reached by OPEC, especially since also Venezuela is in disagreement with the amount it produces. OPEC is supposed to reach a final agreement and specific quota for each country when it convenes again at the end of November. But with Iraq opting out, Iran, Nigeria and Libya already exempted and now also Russia (non OPEC) not willing to join, it is unlikely that anything meaningful will come out of this.
We saw a further drop overnight after the API crude stock showed a build of 4.8 million barrels which is much more than the expected 1.7 million barrels. Today we will be looking to see if yet again we get a large difference between the API and EIA inventories and also whether production in the US kept on increasing last week.
Stocks
Apple – while slightly more iPhones were sold than expected and the forecast for Q1 are a bit better than expected, shares were trading down in afterhours trading. This is due to the fact that the price of the iPhone was lower than previously and also the profit margins have been declining. Furthermore, and maybe most importantly, with Samsung (KS:005930) struggling due to its problems with the Note 7, it was expected that Apple would be able to benefit in a meaningful way, but the guidance of Apple is not showing any significant boost which is disappointing many. On the positive side, they say that demand for the iPhone 7 is so high that they do not have enough supply on hand, so that is a good sign.
Boeing (NYSE:BA) – will be reporting its earnings before the market opens today.