At the moment we are seeing an upward movement in this pair. Despite the destabilizing factors from the eurozone, the euro continues to strengthen against the Swiss currency after a recent sharp fall. Technical indicators indicate to us an upward movement. The price at the moment is under the moving average MA (89) and is trying to break it.

From a fundamental standpoint, we do not expect any factors contradicting this price movement neither for the franc, nor for the euro. Therefore, we will look for an entrance into long positions near the support lines and exit points near the resistance levels.

Support and resistance levels:
1.1355
1.1435
1.1460
1.1495
1.1525
1.1550

Last week's referendum has brought new tensions to Europe.
The European markets shook this week, as last weekend Catalonia, an autonomous area comprising four provinces in northeastern Spain, held a referendum and voted in support of its independence from Spain. This week we would take a look at what happened and also where that leaves us now.
To begin with, the political status of Catalonia has long been a pressing concern on the Iberian peninsula. The region has long claimed it is a distinct nation, owing to historical evidence that up to the 16th century, it used to be separate from Spain. In modern history, Catalonia has fought for its independence all throughout the 20th century: it first received a status as an autonomous region within Spain in 1932, which was taken away during Franco's rule. The autonomous status of Catalonia was restored in the 1970s when Spain returned to democratic rule. Catalans are allowed to speak their own language and have their own government, though officially it is subordinate to the Spanish government.
Over the last few years tensions regarding Catalan nationality have risen, culminating in last week's referendum. Spain is naturally opposed to losing land and people which have been part of its territory over the last five centuries. Catalonia also happens to be a fairly rich territory. In general, if Catalonia declares independence, this would be perceived by Spanish authorities as an attempt to disrupt Spain's territorial integrity and could even lead to (civil) war.
Is Catalonia independent? Right now, no. The referendum's goal was to assess whether the Catalan population wants to be independent from Spain. They voted 90% in favor, but it is up to the Catalan government to decide whether to act on this vote or not. The referendum itself caused violent clashes with the Spanish police, so the Catalan authorities might bide their time, working out a way to avoid future conflict. The Catalan president Carles Puigdemont has spoken about involving international diplomats to help hold peaceful negotiations.
Naturally, the seriousness of this situation has caused ripples through the financial markets. Spanish stocks lost 2.7% this week, while banks that are based in Barcelona (the capital of Catalonia) were a whole 7% down. Spanish bonds have also decreased.
So, what happens now? Some analysts believe that Catalonia is not fully prepared for independence, in terms of its political organs and readiness for policy making. The region has relied on Spain, and by extension, the European Union for many of its day-to-day activities, so severing that relationship will be hard. If Catalonia declared independence without Spain's approval, it would find itself in a tight spot. Spain's economy will also suffer immensely, and future clashes and protests will hinder business activity. Investors could give up on Spanish assets altogether, which could plunge the government into a recession.
It is more likely that there will be a negotiation, which could win Catalonia additional levels of control over its activities, but would still not be a complete independence from Spain.
Because of the current protests and blocked roads, it has been impossible for some businesses to operate as usual. If things continue to be so chaotic and uncertain, Spain's economic growth would stall.
Right now all eyes are on the Iberian Peninsula. If the King of Spain agrees to meet for peaceful negotiations, the pressure would ease off Spanish assets. However, if Catalonia moves ahead and declares independence, we could see a new crisis in Spain, and consequently Europe.

After breaking the channel, the pair is looking forward to the next support level.
Last week the AUD/JPY declined by more than 130 pips after the negative retail sales from Australia, which came at -0.6% compared to the forecasted at 0.3% and the previous one at -0.2%. As a result, the pair slipped from 88.60 to trade now at 87.30. In our last report about the pair we recommended buying the pair around 88.00 and the prices hit our targets at 89.00 and 90.20.
The pair is trading at the support level 87.38 after it broke the short-term price channel last Friday and closed the candle below it, so it may lead the price to further lows in the next days. The moving average is trading above the price to support the negative movement but we have to see a candle close below the support level. The RSI indicator is ahead of 10 level to make an overbought action.
The Next Few Days
Based on this analysis of the the daily chart, we will look forward to an H4 or daily candle closing below the support level 87.38 to sell the pair below it, keeping our target at 85.80. Then we will stay out of the market to see what will happen and the lower limit of the long-term channel. On the other hand, if we see the price back to trade above 88.25 we can buy it till the next resistance level.
This week the markets don't have any important news from Australia or Japan but we will trade carefully regarding any uncalendared news because of the political tensions between the USA and North Korea.

After breaking the channel, we are still looking forward new highs, despite the downward movement this month.
In our previous report about the GBP/CAD pair last month we mentioned the channel breaking and recommended buying the pair after the break. We saw the prices rose last month but they haven't hit our target yet. This month the pair has been declining to reach down the moving average for the last 50 days around 1.6367 - it found a support level there.
The pair is now trading around 1.6500, below 38.2% Fibonacci but we expect the prices will break it up again to resume the correction wave and reach 50% and 61.8% and maybe more, if they break last month's high after forming an inverted head and shoulders pattern. If the prices rose from here directly, the MACD indicator will start giving us a sell signal but the columns are still above the zero level.
The Next Few Days
The plan from here is straightforward. In case of any downward movement we will buy the pair to our main target at 50% - we can take a buy position now around 1.6500 and close part of the trade at 1.5710, and the rest of orders at 1.6850. That is in case the pair is still trading above 1.6223.
The manufacturing production was released from the UK and came in positive numbers at 0.4%, compared to the forecasted 0.2%. This week we don't have any important news elsewhere from the UK or Canada but we have to look at the chart periodically even once a day in anticipation of any uncalendared news.

The strong USD and the high probability of a rate hike this year put pressure on the GOLD. However, the geopolitical situation can change everything.
The situation on the market changed last month and the upward trend turned into a downward one. Until September the dollar had been under pressure due to geopolitical conflicts, the failure of Donald Trump's reformS and weak economic statistics. Consequently, a further increasing of the interest rate this year was doubtful for investors. All these negative factors followed one by one and put pressure on the dollar. Therefore, investors chose safer assets. This led to the Gold rising in price since the beginning of the year.
This week the dollar came under pressure again due to geopolitical risks because North Korea has announced new tests of ballistic missiles which are capable of reaching U.S. territory. However, the dollar has kept at a good level due to the strong economic statistics. The latest data on the labor market showed a decrease in the unemployment rate to 4.2% - the lowest level since 2001. In addition, the average hourly earnings have grown by 2.9%, which increases the probability of rising inflation. Therefore, a rate hike in the US in December is now expected by investors with a probability of 90%.
The resistance line of the trend is under the threat of moving up due to all of the geopolitical risks, but at the moment the most optimal course would be the short deals in the short-term, which is also confirmed by the MACD oscillator.

Today during the Australian session there were a number of indicators for Australia released, which were generally higher than projected.
At the moment the pair is trading in the corridor between Fibo levels held on the daily chart. We observe that the price breaks through the "body" of the candle into our levels and often returns to the previous range.
If we view our graph from the point of view of wave analysis, then we can observe the completion of the medium-term downward movement and the formation of the second upward wave.
This is why today's trading recommendation is to look for points to enter long positions in the area of ??the mark of 0.7810 with the expectation of the formation of an upward wave.

 
The latest events in the US, OPEC, and China have helped stabilize the oil market, but where is it really going?
To anyone interested in the financial markets it is hardly a secret that crude oil has been really far away from its usual glamour over the past few years. What started off as competition between the OPEC states (chiefly led by Saudi Arabia) and the United States exacerbated and led to a dramatically oversupplied oil market, bringing prices down to record lows. Now, more than two years later, is oil finally recovering?
First off, if we look to the United States, generally speaking, they have consistently increased their oil extraction activities. Thanks to shale oil, the US is able to extract oil in a cost-effective manner that allows them to make a profit even at low oil prices. This is why throughout the oil crisis the United States remained undeterred and kept up with their schedule as if nothing out of the ordinary is going on. Towards the end of this summer, however, the US was forced to put some of its activities on hold due to a series of natural disasters along its coastlines, which caused huge damages and disrupted the work of oil extraction facilities. This allowed the markets to ease off somewhat, but there was no reason to assume that the United States would decrease their oil production anytime soon.
On the other hand, last year OPEC member states managed to agree to start cutting their oil production in order to fight the oversupply on the market. With an unbelievably committed compliance with the agreement of up to 90% OPEC managed to decrease their exports and gradually bring oil prices up past the psychological level of $50 per barrel. They were also helped by non-OPEC countries like Russia who willingly joined the reduction effort in order to stabilize the oil market. Investors perked up recently amid news both from OPEC and Russia that everyone is willing to continue with this approach into 2018 in an attempt to restore the market to how it used to be.
Nevertheless, yesterday data on the US oil reserves was released which showed a decline in the number of barrels available. This allowed oil prices to climb up to $51.01 (WTI) and $56.58 (Brent).
In addition, China entered into play again. At the beginning of the oil crisis, China (the biggest oil importer in the world) was quite important – due to its slowing economic growth, it simply didn't demand as much oil as before, so it left the market oversupplied. Now China has started buying oil again, though according to reports, it is not consumer demand, but rather to fill its security reserves. Still, this helped ease the market further.
Another important factor for the oil market right now is the Iran deal. It has to be renewed every 90 days and it's widely expected that Donald Trump would not renew it this week. If he does not renew it, US Congress has two more months to decide on sanctions for Iran, which could block some of the oil supply coming from there. If this happens, supply will decrease and oil prices will move up.
According to the International Energy Agency, 2018 would generally shape to be a balanced year for oil. They report steady increases in demand, which would lead to a healthier oil market, provided the current production levels are met. However, this means that OPEC would need to extend its agreement on production cuts past March 2018, when it is set to expire. If a new agreement is reached and we do not see massive natural disasters, then next year we could finally see the oil market recover.

There is no news from Sweden, so the USD/SEK rate is depending on the situation in the USA. Investors are focused on news about choosing a new FED Head.
Over the last month the situation for the USD/SEK currency pair has not changed. The rates continue in the frames of a downward trend with signs of consolidation. The range of the consolidation phase at the moment is 8.0249-8.1862 SEK.
This week the rates were under the influence of the situation in the United States. The U.S. dollar strengthened against most currencies amid the unstable political situation in the EU. Investors are focusing on the appointment of a new head of the Federal Reserve. This week it was reported that Donald Trump would like to see a supporter of tight monetary policy fill the position of Fed Head. On Monday he met with one of the candidates for the post, John Taylor, who was in favor of active interest rate increase and the achievement of a level three times the current one. Donald Trump was pleased with the meeting, but at the moment it is unknown who will finally be chosen in February 2018. Investors are expecting Trump's decision by November 3.
In any case, the current head of the Federal Reserve, Janet Yellen, also expressed there is a high probability of a rate hike despite the low inflation indicator. She said that the U.S. economy is currently strong enough and the good situation on the labour market allows for an increase in the interest rate in the near future.
The Stochastics oscillator signals reaching the overbought zone and the probability of a price correction in the near future, which allows us to make a profit with short deals. Nevertheless, it should be noted that the USD has the potential for further strengthening in the medium term perspectives. Therefore, pay attention to the point of entry 8.1862 SEK, which may indicate not only the completion of the consolidation phase, but also the trend reversal in favor of USD. On the other hand, the achievement of the level 8.0249 SEK confirms the continuation of the current downtrend.

The pair continues its bullish movement.
Today we would direct our attention to the EUR/JPY currency pair. It has been moving in an upwards direction since May this year, and despite some fluctuations here and there, this still remains the general trend.
The pair is currently seeing some volatility because we are awaiting a speech by the ECB chief Mario Draghi, as well as the CPI release from the eurozone. In Japan we received news that the Bank of Japan is firmly supporting a dovish policy for the near future, which would allow the yen to ease on most currencies.
Right now we have a pivot point for the price located at 132.86. Below the pivot lie the support levels of 132.6, 132.21, and 131.56. Just above the pivot we have the nearby resistance levels at 133.25, 133.52, and 134.17. Here we can apply the general rule for price movements: if the price falls below the pivot, expect it to touch the support levels; if it goes above the pivot, then the resistances might be overcome.
As of the moment of this article's publication the EUR/JPY is trading around 133.08, which is above the pivot and close to the first resistance level. Although the various technical indicators are giving us some mixed signals, most favor taking a sell position right now. Our general outlook for the pair is bullish.

Speculations around the Federal Reserve and positive statistics support the USD. The NZD continues to fall.
The rates continue in the frames of a downtrend. The New Zealand dollar still cannot find enough incentives for strengthening and a trend reversal in its favor. The situation may change if the RBNZ makes a decision to raise interest rates at their next meeting which will be held on November 8. There are reasons for the increase, such as inflation growth in Q3 to 1.9%, which not only exceeds the expectations of investors, but also exceeds the forecast of the RBNZ. Given that at the moment the interest rate is at a historic minimum and has not changed for a long time, the RBNZ may revise the rate at their next meeting, although it had previously planned to do that in 2019.

This week the rates were influenced by speculations about who would be the new head of the Federal Reserve. Initially, it was predicted that Donald Trump wants to choose a supporter of tight monetary policy, but the latest information on the market is that the biggest chances are currently for a supporter of less "hawkish" policy, Jerome Powell. The U.S economic statistics were positive enough: the manufacturing PMI for the state of New York in October jumped to 30.2 points. The index of business activity from Philadelphia's FED also unexpectedly increased in September. There was also positive data on the labor market. All of this has led to the dollar's strengthening against the NZD.
After the publication of the recent data about inflation in New Zealand, the NZD managed to strengthen a bit against the dollar, but then the rates went down due to positive economic data and the speculation around the FED in the USA. Nevertheless, now the NZD has all chances to strengthen in the near future. Oscillators (Stochastics, MACD, RSI) unanimously point to the rates in the oversold zone, suggesting the expediency of opening the deals to buy against the trend to make a profit based on the price correction.

To prepare your trades for this week, pay attention to this kind of important news happening this week.
It is Monday, which means it's time for traders to plan their moves for this week. Many things are going on around the world right now, but here is a brief overview of some of the key events to focus on during the week.
Without a doubt the most important piece of news you need to be wary of this week is the ECB policy meeting this Thursday. This event is keenly awaited by investors who have been speculating for many months now that the ECB will switch its policy focus and begin tightening its stimulus program. ECB president Mario Draghi will give a speech after the announcement, which would be another great opportunity to look for hints for the end of the stimulus measures. Analysts are currently hoping to hear that the stimulus amount will decrease from 60 to 40 billion euro from January, and that the program will not last longer September next year. If this is announced this Thursday, expect new interest in the euro.
Across the Atlantic we are awaiting news on the American GDP for the 3rd quarter of 2017. This would cover the period when the United States were repeatedly hit by hurricanes, had their oil extraction activities interrupted, engaged in verbal conflict with North Korea, and more. In other words, it was a turbulent period and the GDP report will provide an objective assessment to how the country's massive economy handled it. The GDP will be published this Friday and will be an important pointer for the Federal Reserve to decide whether to increase interest rates in December.
We also expect the third quarter GDP for the United Kingdom this Wednesday, together with news on the Brexit negotiations.

For the moment we are seeing an upward movement in the pair and the fact that at the moment it is trading near the Fibo level of 50% is drawn on the daily chart.
In connection with Donald Trump's appointment of the new head of the Federal Reserve and the imminent adoption of the budget for 2018, we expect that the growth of the reserve currency will continue.
The price has moved away from the Fibonacci level and soon will test it again. So the point of entry on the long positions will be sought at our level, to 40 points.
Our RSI and Stochastic  indicators confirm the entry of the purchase.
When the correction happens, it is recommended to enter into long position.
0.9800
0.9840

There're a high volatility today. Investors are waiting for the decision of the Bank of Canada about raising the interest rate. Probably this issue will be postponed until December.
The AUD/CAD rates continue in the frames of a weak downward trend. The only thing that has changed over the last month is a shift of the support line down. The resistance hasn't changed for a while despite a number of signs of a new uptrend that can be seen on the chart.
Today is full of events for the AUD/CAD currency pair, which led to a sharp increase in volatility on the market. Since the beginning of the day the Australian dollar has come under pressure due to recent negative news about the Australian economy: the inflation rate in the 3rd quarter was only 0.6%, which does not match the expectations of analysts. The inflation rate in annual terms was 1.8% against the expected 2%. The weighted average consumer price index was also below the forecasted level. Therefore, the value of the AUD fell sharply against major currencies.
At the moment investors are waiting for the decision of the Bank of Canada about the interest rate. Though, investors suppose that increasing them will be postponed until December. Also important is the report of the Central Bank about further monetary policy. Last week the CAD was under pressure due to a decreasing of the retail sales volume of 0.7%, while economists were expecting growth of retail sales in 0.3%. The rate of inflation has slowed down. The Australian dollar, in contrast, received support, mainly due to recent data about the economy of China.
The Stochastic oscillator indicates the rates are in the oversold zone, so there's a high probability of a price correction soon. In this situation the deals to BUY against the current trend would be the most effective. It can be assumed that the most likely decision of the Bank of Canada is to leave interest rates unchanged, temporarily negatively affecting the value of the CAD, which confirms the efficiency of the deals to BUY. However, it's too early to speak about the formation of an upward trend. It should be noted that the price of oil has a tendency to grow. Increasing oil prices support the Canadian dollar, so the downward trend has all chances to continue.

At the moment, we see that the pair is trading in a downward channel.
At the moment we see that the pair is trading in a downward channel.
Today we expect the ECB press conference at which Mario Draghi will announce the amount of reduction of asset redemption, which will undoubtedly impact the single currency. At this point the market has already played the expectations of strengthening and if the volumes amount to 30 billion, as we do not expect, it is assumed that significant fluctuations will occur.
The growth rate of the reserve currency continues to be affected by a number of factors that are encouraging to investors. It's possible that there will be an adoption of Trump's tax reform and the expectations of higher interest rates are steady as well.
Now, our pair found resistance level around the 1.1825 mark and is trying to get back in the downstream channel.
The Stochastic indicator came out of the overbought zone and gave us a sell signal.
The RSI strayed from level 70 and also shows a downward movement.
This is why we need to look at the short positions near the entry point marks 1.1825 and the upper border of the channel 1.1815. The targets will be 1.1790 and 1.1745.
In the case of a smaller decline in bonds repurchase, at the level of 40 billion euro, we should expect a positive trend for the Euro and then these levels will serve as support. Then our objectives in long positions will be 1.1850 and 1.1875.
At the time of the press conference entrance into the market is risky.

The euro slumped after the ECB announced its decision regarding stimulus measures yesterday.
Throughout this week news headlines were dominated by one thing: Thursday's press conference of the European Central Bank. Despite losses for the euro over the past few weeks, largely due to the political tensions between Spain and Catalonia, the single currency managed to recover some of its losses this week, on the expectation that the ECB would finally announce a plan to phase out of its ambitious stimulus program. Did that happen? It seems that the answer is somewhat complicated.
Let us take a step a few years back first. Amid the fallout of the economic crisis of 2008 the global recession reached Europe and we saw massive economic slowdowns even in the most developed countries in the world. This prompted a new dovish trend among central banks: buying government bonds on a massive scale in order to promote growth and inflation. We saw this happen in the United States, in Japan, and even in Europe.
This is why the European Central Bank has been buying 60 billion euro worth of bonds per month over the past few years. Their efforts have shown results – economic data from all over the eurozone comes in consistently positive, European countries are enjoying economic growth of 2-3%, and inflation has increased, compared to 2008. This positive effect has prompted investors to hope for an end to the stimulus measures, which would allow the euro to start increasing in value against major currencies.
Yesterday's press conference of the ECB, however, brought mixed results. The central bank finally showed a willingness to move away from stimulus by announced a reduction of the package in half – from 60 down to 30 billion euro per month. That would have been good news for investors and for the euro, had it not been for one addition – the ECB plans to continue with the measures well into 2018, possibly until September. The stimulus package is still needed, according to the ECB, because the healthy inflation rate of 2.0% has not been achieved yet (it is at 1.5% currently).
The markets were hoping for something more short-term, rather than the nine months of bond redemption planned for 2018. As a result, the euro dropped dramatically overnight, falling to trade around 1.1626 today. While investors were hoping to awake to a stronger euro, it seems that the ECB prefers it this way: by preventing the euro from appreciating, the ECB is ensuring exports from the EU are not going to suffer.
So, what's in store for the euro? The ECB has shown an ability to act flexibly. They would keep a close eye on data from the EU, particularly to wage growth and inflation. It is possible that they would revise their expectations at their next meeting in December. Most importantly, investors need to understand that the ECB is trying to move very slowly, as sudden changes in the financial markets could have a harmful effect and undo all the good the stimulus program has achieved so far. In general terms, this means we are not likely to see a much stronger euro within the next year – unless there are external reasons, such as problems with the American dollar, for example.