The overall market sentiment is risk-on. The S&P 500 index (US 500) is getting close to the all-time high. Oil is recovering quickly from its recent losses.
News to trade on October 31
- The Bank of Japan announced no changes to its monetary policy in its statement. The interest rate remained at -0.10%, as it was widely expected. The economy of the country will continue to expand moderately. In addition, Japan made downward revisions to GDP (1.4% vs. 1.5% projected in July), CPI (1.4% vs. 1.5% projected in July) for 2019. Following the statement, USD/JPY rose above the resistance at 112.719. More positive comments on the outcome of the US-China trade war can support the USD and the pair can stick above the resistance at 113.569. If the JPY is stronger, the pair will fall below 112.719.
- Chinese manufacturing PMI fell to 50.2 in October. Also, the headline CPI for Australia declined to 1.8% reaching lower than the expected level. It made AUD/USD to test the support at 0.7077. The strong US dollar can make the pair to fall below 0.7077 to the next support at 0.7029. Otherwise, the pair will rise to the resistance at 0.7134.
- The US dollar index was supported by the higher-than-expected level of consumer confidence. The indicator increased to 137.9 vs 135.3 expected. It made the price to test the resistance at its August highs at 96.76. Up to now, the currency is trading in the red zone. Positive news for the USD can make the price stick above 96.76. In case of negative news, the US dollar index will wall downwards to the support at 96.00.
- As for Canada, there are two important events for today: the release of monthly GDP and the speech of the Bank of Canada Governor. GDP is anticipated to stay at the same level, however, the BOC governor Mr. Poloz can make hawkish comments which will support the currency. Recently, the BOC increased the interest rate to 1.75%, so the Governor can throw some hints on the current monetary policy of the bank. Today USD/CAD is rising towards the resistance at 1.3185. If the CAD is supported by today's news, the pair will be able to fall below the support at 1.3076.
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