RECAP

In a trend observed every day this week, S&P futures are slightly in the red ahead of a post-open ramp with the VIX rising to 9.91, as Asian shares climb, European stocks are little changed. WTI crude pares recent gains, slipping below $51 after API showed an unexpected crude build.

The Fed minutes released Wednesday showed officials debated hard last month over whether forces holding inflation down were persistent or temporary, with several policymakers looking for stronger evidence of price gains before supporting a third interest-rate increase this year.

European equities kicked off the session on a relatively tame footing with very little seen in the way of direction. In terms of sector-specific performance, things are also relatively contained with some very modest underperformance seen in financial names in the wake of yesterday’s slightly more dovish than anticipated FOMC minutes release.

In the U.K., sterling rose for a fourth day even as the fifth round of Brexit negotiations draws to a close with seemingly little progress. When Barnier, the EU chief negotiator, expressed that the Brexit talks have reached a deadlock and with no end in sight, the pound lost all its gains for the day and is trading in the red as of this post.

In FX markets, the USD has regained some ground against its major counterparts that was seen in the wake of the aforementioned FOMC minutes with ranges overall relatively tight. This is likely as a by-product of a quiet European calendar and macro news flow with a bulk of today’s releases and speakers not due until the latter half of the session.

Gold continued its rally to climb above its 21-DMA, rising 0.2% to $1,294.66 an ounce, the highest in more than two weeks. West Texas Intermediate crude declined 0.7 percent to $50.93 a barrel.

OUTLOOK

Looking at the day ahead, in the US, the big focus will be on the September PPI report (0.2% mom; 2% YoY expected for core), while the latest weekly initial jobless claims will also be released. Onto other events, today is a busy day for speakers with the ECB’s Draghi and Fed’s Brainard due to take part in a monetary policy panel in the afternoon, while the Fed’s Powell will speak shortly after at a conference in Washington. President Trump is also tentatively scheduled to give a speech on US policy towards Iran.

TRADERS VIEW

The major currencies stayed within tight ranges before a series of speeches by policymakers and U.S. data. The Bloomberg Dollar Spot Index erased an early loss as the euro failed to hold onto gains. Gold continued its rally to climb above its 21-DMA and the MSCI Asia Pacific Index rose to the highest in about 10 years. Treasury yields dropped as the market looks to inflation data out of the U.S. due Friday.

Investors will be focusing less on the today’s Economic data and more on the actual speeches by ECB President Draghi and FOMC members Brainard and Powell, where they will be participating in a discussion panel about Monetary Policy. Not to mention, the President of the United States Donald Trump is scheduled to speak on Iran Nuclear Agreement decision.

GBPUSD – There goes the positive momentum that the pair has been gaining over the past couple of days. The pair has dropped to 1.3141 after the Brexit talks have reached an impasse with each of both parties unwilling to budge.

USDJPY – For the past couple of days the pair has been caught in a consolidation as the RSI continues to print between the 60- and 40-Level and the MACD is pointing towards an increase in momentum over the short term.

EURUSD – The positive momentum over the short term is starting to fade after the MCAD has started to point to lower levels as it starts to indicate some consolidation. The RSI has dropped below the 60-Level and sits right at 50-Level representing consolidation.

AUDUSD – After managing to rise to a day high of 0.7835, effectively breaking above the 0.7800 psychological resistance, the pair is poised to continue higher over the medium terms. RSI shows a slight dip below the 60- Level, yet price movement indicates that the 200-1HourMA at 0.7800 will offer some support.

USDCAD – Back below the 55-DMA, the pair seems to be reacting to the positive rise in the price of oil. RSI is showing that the pair has still some room to go lower as it prints in the high 40s, close to 50-Level.

Dow Jones – The futures index keeps rising upwards as it reached an all-time of high of 22820 and seems to continue to rise ahead of Economic Figures and FOMC speakers.