Market Summary
Asian markets were mostly higher Friday, with investors setting up their positions ahead of the week-long Chinese National Day holiday that will see several market closures in the coming week, including the mainland remaining closed for the entire week. Japan’s Nikkei ended September with its best performance of the year, while Australia’s S&P/ASX 200 saw a fifth consecutive monthly decline.
European markets finished September with their seventh consecutive winning session, and September was the best month of the year for broad-based European indices. Banking shares were the leaders Friday, and investors got more signs of strong growth in the European Union as Germany reported its lowest ever unemployment rate. London’s FTSE posted its second best day of September, but was lower on a monthly basis.
U.S. markets continued to extend gains into record territory, with the Russell 2000 continuing to lead markets higher. The Russell 2000 closed at a new record high for the 21st time in 2017, and the S&P500 and Nasdaq also had record closing highs.
Today’s Assets
GBP/USD
The pair fell on Friday, even as the USD was weaker against most rival currencies. The drop came off the 1.3400 level, which has now been resistance for the pair in three consecutive sessions. It looks as if this level may be the new short-term ceiling for the pair as investors belief in a U.K. interest rate hike has waned. It may be possible for the pair to test the 1.3200 level for support later this week.
Gold
The daily chart clearly shows gold in a downtrend, and zooming out to the weekly chart clearly shows the weakness of the precious metal at this time. While there could be some bounces, we think that gold is so out-of-favor that it could soon be testing support around the $1,200-$1,210 level.