• The dollar index's overnight breakdown sent USD/JPY sharply lower

• Prior October lows near 105 broken, with 104.345 the EBS low since

• Pair oversold intraday and steadying near 76.4% Fibo @104.50 nL1N2HC0ZE

• The $2 bln of 104.50 expiries on Friday might also cushion the fall

• Sep's 104 low and 100% Fibo off 106.11-5.04 drop at 103.97 are next props

• A close well below the lower 21-day Bolli, last at 104.89, is bearish

• And 21-day Bolli bands are widening from Tuesday's tightest since 2014

• Fear of more negative Tsy-JGB real yield spreads off relief bill, Fed policy

• Relief bill, whenever, seen dimming demand dollar as a haven, upping sales

  For more click on FXBUZ

• GBP/USD ending NY +1.63% at 1.3160; NorAm range 1.3177-1.3045

• Pair up on USD weakness, upbeat Brexit tones, BoE move away from neg rates

• Sterling gains on upbeat Brexit, negative rate views fragile nL1N2HC13A

• Trump ready to deal, Pelosi optimistic on further COVID aid nW1N2G500C

• GBP res just abv Sep 8 high 1.3173, next res 1.3291 76.4% of 1.3481-1.2676

• Support at fmr resistance daily cloud top 1.3082, then 10-DMA 1.2986

• EUR/GBP -1.23% at 0.9023; Wed range 0.9139-0.9016; broad risk rally stirs long EUR unwind

Bank of America Global Research warns that the number of new covid-19 cases is climbing at an alarming rate across a majority of the US.

"Since our last update, new virus cases in the US have continued to rise and indicators of economic activity appear to be moderating...The 7-day average of new daily cases has increased by 72% from the September trough to 58.3k as of yesterday. This has outpaced the 44% rise in testing over the same period and as a result the positive rate has increased by 0.6pp to 5.5%. Hospitalizations and deaths have also started to trend higher," BofA notes. 

"With the economic data pointing to a moderation in activity, we remain very concerned that the recent surge in new virus cases will hinder the economic recovery. Moreover, we fear that states that have experienced relatively stronger economic recoveries are those currently experiencing the most severe virus outbreak . This could lead to an increase in voluntary social distancing in these states or government mandated measures to restrict activity," BofA adds. 

• EUR/USD rally off the Oct 15 low extends, trades to a 25-day high

• Bull clear key impediments, daily cloud top, 61.8% Fib of 1.2014-1.16125

• Close above those resistances should bolsters bulls' confidence

• Daily, monthly RSIs are rising which implies bull momentum is in place

• Sep 2 & 10 highs, 76.4% Fib of 1.2014-1.16125 are impediments above market

• Break of those resistances should drive a test of September's monthly high

• For more click on FXBUZ

TD discusses the coming US elections and believes that investors are now largely pricing in a Democrat sweep — the so called Blue Wave.

"We think this is reflected in the bear steepening in the Treasury curve, weaker USD and higher equities. This is also consistent with the polls and betting odds that show Biden's lead beyond the margin of error," TD notes. 

"A Blue Wave can extend the recent bear steepening move in rates, reinforce the market's existing short USD bias, led by EMFX, and the focus on a large Green New Deal should be a tailwind for copper. A split government creates a tenuous relationship for risk given it could come with an expectation of less fiscal easing and likely longer uncertainty to get an outcome, bull flattening the curve," TD adds. 

GBP/USD surged to a six-week high by 1.3147 on Wednesday, breaking through resistance at the daily cloud top and upper 30-day Bolli above 1.3080, which should put higher levels on the agenda if conciliatory Brexit talk produces tangible results.

Cable's gains tracked a broad risk move higher as markets eye U.S. relief aid, which is expected to lift global growth nL1N2HB0H1.

The pound received an added boost in early U.S. trade after BoE Deputy Governor Dave Ramsden reiterating the MPC's view that now was not the time to use negative rates nS8N2GL02T and optimistic comments by EU negotiator Michel Barnier on Brexit nS8N2H5011.

Sterling bulls should be cautious.
Short-sterling futures still project negative rates beginning in early 2021 0#FSS:.
Further, the upbeat Barnier comments nL8N2HC2JR fall far short of noting progress on a deal, touting the need for both sides to work constructively and compromise.

The break above the daily cloud puts the Sept. 7 high at 1.3173 in focus.
Without a Brexit deal todamp negative-rates speculation, recent GBP/USD gains are likely to be short-lived.

For more click on FXBUZ

MUFG Research maintains a bearish bias on GBP/USD, expressing that via holding a short position targeting a move towards 1.2630.

"The rates market is slowly pricing in a greater chance of negative rates in 2021. By the August 2021 MPC meeting, OIS market pricing implies a 90% probability of Bank Rate falling to -0.10%. First to come is likely to be more QE highlighted yesterday in comments by Gertjan Vlieghe that the outlook for monetary policy was “skewed towards adding further stimulus”. Indeed, more QE in November is looking likely now," MUFG notes.

"In many ways, Brexit is somewhat of a side-show to the building risks as COVID spreads that clearly will increasingly undermine GBP performance. We continue to see downside risks, reflected in our FX trade idea from last Friday," MUFG adds. 

Credit Suisse discusses EUR/USD technical outlook and maintains a medium-term bullish bias targeting a move towards 1.2140/55.

"EURUSD has surged higher over the past three days, breaking clearly above the potential downtrend from the September high, 55 -day average and the 9th October high at 1.1775/96. With the EUR TWI also on the cusp of negating its small top, this ends thoughts of a short term correction lower and should finally reassert the core bull uptrend, further reinforced by the fresh cross into bullish territory for daily MACD momentum," CS notes. 

"Next resistance is then seen at the 1.1918/26 corrective price high and 78.6% retracement of the September fall, before the 1.2011 high. Bigger picture, our medium term objective remains the ‘neckline’ to the 2018 top at 1.2140/55. Short term support at 1.1800/1795 now ideally holds to maintain the upside risks. Below here on the back of a hold below 1.1864/73 would quickly turn the short term risks back lower," CS adds.

EUR/USD has risen on hopes for U.S. stimulus and the greater unity in Europe that resulted from the coronavirus crisis.
It's likely to rise further, but recent gains have happened at the wrong time and will probably be reversed nL1N2HC073.

More stimulus is likely, but not until U.S. election have been decided.
With a new administration on the cards, stimulus is more likely early next year than late this year.

EUR/USD has been driven up just ahead of the European Central Bank's monetary policy meeting on Oct.
29, making a negative reaction more likely.
Inflation is far below target and a strong EUR is central to ECB's problems.
The ECB may not target FX, but it does target inflation, and it must boost CPI to meet its objective.

There's a high probability profit-taking will weigh on EUR/USD before the end of the year.
Trader's bets on a rise are massive.
Some adjustment is inevitable and the big CNH rise will hamstring EUR nL1N2HC05R.

That said, a EUR/USD dip is one that traders should look to take advantage of.
The uptrend is solid and 1.15-1.16 drop would clear the decks before a likely 2021 rally on the back of more U.S. fiscal stimulus.

For more click on FXBUZ

• AUD/USD met headwind pre-0.71 after pushing recovery envelope from 0.7021

• 0.7103 is the 100DMA. 0.7021 was Tuesday's three-week low nL1N2HB05M

• Ascent to threaten 0.71 influenced by yuan's rise to 27-month high vs USD

• See: nL4N2HC15V. Other majors up against USD, including CHF nL1N2HC06I

• 0.7072 (Tuesday's NY session high) is now an AUD/USD support point

• Monday's high of 0.7114 is a resistance level beyond the 100DMA

• Trend breakout topside: GBP set to test key resistance points nL1N2HC05X

• Upper 30DMA Bolli and cloud top 1.3081, ties in with recent 1.3080-83 highs

• We offer by 1.3080 but might consider stop and reverse at 1.3175

• 1.3173 is the 61.8% Fibo of the 1.3481-1.2676 move

• Converging daily trend lines gives a triangle base at 1.2890 today

• Patchy weekly bull run resumes above 1.3083: risk to bear plays

  
  

• Today EUR/USD traded just above daily Ichimoku cloud by virtue its decline

• Daily cloud is 1.1635-1.1849. Today's high 1.1863 EBS, last 1.1857

• Last major rally followed a break above cloud in May

• Two vital differences. Then few traders long and rally came from below cloud

• Today many traders are long and there's a cloud twist 1.1760-77 to concern

• Cloud twists attract. This one occurs Nov 6, close U.S. election result

• Trend bullish but new ground more likely next year then this nL8N2HB1UU

• 
  

• Cable rises to 1.3001 after UK CPI as expected, +0.5% YY nL8N2HB6KI

• 1.3001 = two-day top. 1.2984 was pre-UK inflation data release high

• Resistance levels include 1.3024/30 (Monday/Thursday high) and 1.3083

• 1.2979 (Tuesday's high) is now a support point. 1.2911 was Tuesday's low

• BoE's Ramsden, speaks at 1210GMT; he is against sub-zero rates nL1N2HB09W

• 10-year U.S. Treasury yield rises to highest level since June 9 nL4N2HC1CP

• EUR/USD has breached the top of the thick cloud, that spans 1.1635-1.1849

• The key 1.1861 Fibo, 61.8% of the 1.2014 to 1.1613 drop, is under threat

• The market has not traded outside the daily cloud since Sept 22

• A daily close above the cloud would likely lead to a surge in tech buying

• However, a failure to perform a close above could see a market relapse

• Spot is on a knife-edge. EUR/USD Trader TGM2334. Previous nL1N2HB03Q

• AUD/USD resurrected after falling six out of last seven days

• Tentative rally could provoke short-covering toward 0.7125

• Wed close above 0.7067 nullifies Bollinger downtrend channel

• Profit-taking could then drive it up to 20 DMA resistance

• Risk appetite returns with optimism for US stimulus nL1N2HB0H1

• US stock futures rise 0.5%, US10y yield spikes to 0.826%

• For more click on FXBUZ

  
  

• AUD/USD rallies 0.4% in Asia, buoyed by positive risk sentiment & yuan rally

• Optimism over pre-election U.S. fiscal stimulus lifts risk mood nL1N2HB0H1

• Traders take a respite from selling on perception drop overextended

• AUD had lost 3% from 0.7243 Oct 9 high on rising expectations of RBA easing

• Solid rise in quarterly retail sales lifts hopes of an economic recovery

• Resistance 0.7100-05, 0.7120-25, support 0.7045-50, 0.7010-20

• Related nL4N2HC092

• For more click on FXBUZ

• +0.1%, USD led on U.S. aid package optimism - E-mini S&P +0.5% nL1N2HB0H1

• Cable trades towards the top of a low key 1.2952-1.2970 range

• Johnson's 3-year UK spending master plan set to be ditched - FT nL4N2HB4A4

• Brexit end game, coronavirus, US election - big move is coming nL1N2HB2HC

• Charts; momentum studies, 5, 10 & 21 DMAs conflict, which is a neutral setup

• Close below 1.2909 21 DMA would be bearish - targets a 1.2709 200 DMA test

• 1.3079/87 major resistance, 50% Sep fall, October top and upper 21 day Bolli

• Earlier 1.2952 low and London 1.2979 top are initial support-resistance

For more click on FXBUZ

• AUD/USD is up 0.43% from the opening level at 0.7049 in risk-on Asia

• Hopes an agreement can be reached on US aid bill supporting risk

• E-mini futures and the AXJ equity index are both up 0.45%

• Market shrugging off report Republican Senators are opposed to passing bill nL1N2HB0H1nL4N2HC0DQ

• High so far for AUD/USD has been 0.7079 and range has been 0.7047/79

• Resistance is at the 100-day MA at 0.7103

• Support is found at the Sept 25 trend low at 0.7006

• Heading into the afternoon the AUD/USD is settled around 0.7075

• For more click on FXBUZ

• E-mini futures are up 0.40% on report aid talks moving closer to a deal nL1N2HB0H1

• AUD/USD slightly better bid early Asia, as an agreed deal would boost risk

• Resistance is at yesterday's 0.7072 high and 100-day MA at 0.7102

• An agreement between Hose Democrats and White House would have to pass Senate nL1N2HB1F4

• For more click on FXBUZ

• Touch firmer after closing little changed with an inside day - range extends

• No move on EU 'level playing field' or UK 'sovereignty' issues nL8N2HB24U

• Johnson's 3-year UK spending masterplan set to be ditched - FT nL4N2HB4A4

• Brexit end game, coronavirus expansion, US election - big move is coming

• Charts; momentum studies, 5, 10 & 21 DMAs conflict - neutral setup

• Close below 1.2908 21 DMA would be bearish - targets a 1.2709 200 DMA test

• Major resistance around 1.3080, 50% Sep fall, upper 21 day Bolli & Oct top

• NY 1.2911 low and London 1.2979 top are initial support-resistance

  For more click on FXBUZ

• AUD/USD opens 0.28% lower at 0.7048 after choppy US session

• It traded as low as 0.7021 before hopes of US aid deal led to risk bounce nW1N2GK03K

• It bounced back to 0.7072 before Wall Street halved early gains in last hour

• AUD/USD support at Sept 25 trend low at 0.7006 with buyers around 0.7020

• Resistance at the 100-day MA at 0.7102 with sellers tipped at 0.7080

• US aid deal in focus and if it passes AUD/USD will get some relief

• Upside limited due to dovish RBA expectations ahead of their Nov 3 meeting nL4N2HB09Y

• For more click on FXBUZ

TD Research discusses GBP outlook and warns of sharp swings in market's mood over the coming days.

"For now, we think that 1.2860/65 should provide solid support in cable. The next major reassessment point to the upside does not come in until last week’s high at 1.3083, suggesting we have plenty of room to extend higher — as long as sentiment remains firm," TD notes. 

"We note, however, that with the final days running down to a whole host of top-tier risk events and still a lot at stake, we are in a particularly mercurial and capricious time right now. This suggests the potential for sharp reversals and abrupt swings in the market’s mood are higher than usual," TD adds. 

The euro rose to a one-month high versus the dollar on Tuesday as signs of progress toward U.S. COVID-19 relief spending nL1N2HB0H1nW1N2G5009 diminished the U.S. currency's safe-haven appeal, while record demand at a sale of EU bonds added to the single currency's attraction nL8N2HB23F.

The record 233 bln euros in bids for the EU's inaugural SURE bonds nL8N2HB23F reinforced the euro-bullish notion that the bloc's 750 bln euro recovery fund slated for 2021 would also find plenty of funding support nL1N2HB10D.

Added fuel for risk-on flows and dollar sales came from New York Fed executive vice president Daleep Singh, who said the Fed could buy both corporate bonds and ETFs if there was significant market stress nW1N2GW03H.

EUR/USD rallied to 1.1841 on EBS, its highest since Sept.
21 and near the daily cloud top at 1.1849.

A clear EUR/USD breakout above the daily cloud could squeeze out shorts premised on a potential breakdown below 1.1700 toward the cloud base and 100-day moving average supports near September's 1.16125 low nL1N2HB0VO.

The flip side is CFTC data showing a sizeable net speculative long EUR/USD position remains, tempting sales into rallies.

GBP/USD was little changed as Brexit trade deal debate groaned on amid rising COVID-19 cases in the UK and EU nL8N2HB24U, which eroded the pound's linkage to the S&P 500.

Pound bulls were stung by Monday's bearish rejection from the 55-day moving average, resulting in Tuesday's indecisive inside day, while EUR/GBP climbed to its highest since this month's peak on Oct.
7.

USD/JPY popped above 50% and 61.8% Fibos of the recent 106.11-5.04 drop at 105.575/70, but the early U.S. rise was rebuffed by offers at the 55-day moving average line at 105.75 nL1N2HB15B.

Broader dollar slippage on relief bill hopes and 10-year Treasury yields again running into resistance at 80bp ushered in a retreat to the 10-DMA by Monday and Friday's highs at 105.50 and then below.

AUD/USD struggled in the wake of dovish RBA minutes, but reversed hard upward after nearing September's lows, taking its risk-on cue from rebounding U.S. stocks and relief bill prospects nL1N2HB17I.

The Fed's beige book report Wednesday is the last substantive event risk ahead of Thursday's jobless claims report and the presidential debate.

For more click on FXBUZ

• The dip below the 10-DMa was short lived, a rally ensues

• The lift see the 55-DMA get pierced while daily & monthly RSIs rise

• Bears lean against the daily cloud top currently at 1.18487

• Break of the cloud top could lead shorts to exit their positions

• Test of 1.1910/30 resistance zone is then a possibility

• For more click on FXBUZ