Trading Central--MORNING MARKET UPDATE

Market Wrap: Stocks, Bonds, Commodities

On Wednesday, U.S. stocks rebounded following a sharp sell-off in the prior session. The Dow Jones Industrial Average rose 127 points (+0.39%) to 33,129, the S&P 500 climbed 34 points (+0.81%) to 4,263, and the Nasdaq 100 jumped 210 points (+1.45%) to 14,776.

The ADP jobs report showed that the U.S. economy added only 89,000 private jobs in September (vs +160,000 expected). 

The Institute for Supply Management (ISM) services index dropped to 53.6 in September (vs 53.7 expected), while factory orders grew 1.2% on month in August (vs +0.3% expected).

The U.S. 10-year Treasury yield retreated 6.5 basis points to 4.731%.

Automobiles (+4.98%), software & services (+1.7%), and media (+1.48%) stock sectors gained the most, while energy (-3.36%) and telecoms services (-0.62%) sectors were under pressure.

Tesla (TSLA) rebounded 5.93%, and Rivian Automotive (RIVN) jumped 9.22%.

Carnival (CCL) rose 2.75%.

RPM International (RPM), a maker of specialty chemical products, gained 6.26% on upbeat first-quarter results.

On the other hand, energy stocks were weighed down by falling oil prices. Marathon Oil (MRO) dropped 4.98%, and Occidental Petroleum (OXY) slid 3.87%.

European stock markets closed mixed. The DAX 40 added 0.10%, while the CAC 40 closed flat, and the FTSE 100 was down 0.77%.

Oil prices fell sharply on signs that fuel demand in the U.S. declined. U.S. WTI crude futures plunged $5.01 (-5.60%) to $84.22 a barrel, and Brent crude futures sank $5.11 (-5.60%) to $85.81 a barrel.

The U.S. Energy Department reported that crude-oil stockpiles dropped 2.22 million barrels (vs -0.45 million barrels expected), but gasoline stockpiles surged 6.5 million barrels (vs +0.16 million barrels expected).

Gold price dipped a further $2 to $1,820 an ounce.

Market Wrap: Forex

The U.S. dollar softened against other major currencies. The dollar index eased to 106.76.

EUR/USD gained 39 pips to 1.0506. In the Eurozone, retail sales declined 1.2% on month in August (vs -0.1% expected), while producer prices fell 11.5% on year in August (vs -11.6% expected).

USD/JPY added 9 pips to 149.11. Market participants reported that there were no signs of Japanese authorities intervening in the forex market.

GBP/USD climbed 62 pips to 1.2139.

AUD/USD increased 24 pips to 0.6326. This morning, Australia's data showed that trade surplus widened to A$9.64 billion in August (vs A$8.50 billion expected).

USD/CHF fell 40 pips to 0.9170.

The Canadian dollar was dragged by plunging oil prices. USD/CAD climbed 36 pips to reach 1.3744.

Bitcoin gained 1.3% to $27,780.

EUR/USD Intraday: bullish bias above 1.0480.

Pivot:

1.0480

Our preference:

Long positions above 1.0480 with targets at 1.0530 & 1.0545 in extension.

Alternative scenario:

Below 1.0480 look for further downside with 1.0465 & 1.0450 as targets.

Comment:

The RSI calls for a bounce.

GBP/USD Intraday: the bias remains bullish.

 Pivot:

1.2105

Our preference:

Long positions above 1.2105 with targets at 1.2160 & 1.2175 in extension.

Alternative scenario:

Below 1.2105 look for further downside with 1.2090 & 1.2070 as targets.

Comment:

Technically the RSI is above its neutrality area at 50.

USD/JPY Intraday: choppy.

Pivot:

149.30

Our preference:

Short positions below 149.30 with targets at 148.70 & 148.50 in extension.

Alternative scenario:

Above 149.30 look for further upside with 149.50 & 149.70 as targets.

Comment:

As long as 149.30 is resistance, look for choppy price action with a bearish bias.

Crude Oil (WTI)‎ (X3)‎ Intraday: the downside prevails.

Pivot:

85.50

Our preference:

Short positions below 85.50 with targets at 83.50 & 82.45 in extension.

Alternative scenario:

Above 85.50 look for further upside with 86.90 & 87.80 as targets.

Comment:

The RSI has broken down its 30 level.

Gold Intraday: intraday support around 1815.00.

Pivot:

1815.00

Our preference:

Long positions above 1815.00 with targets at 1827.00 & 1833.00 in extension.

Alternative scenario:

Below 1815.00 look for further downside with 1810.00 & 1805.00 as targets.

Comment:

A support base at 1815.00 has formed and has allowed for a temporary stabilisation.