China CPI slowed more than expected to 1.6% in September vs 1.8% expected and resulted in stock markets falling once again in Asia. CPI now slowed 3 straight months indicating a reduction in prices and a slowdown in the economy. AUD, CAD and NZD dropped versus the USD.
EURUSD reached a 3 week high at 1.1400 as currency traders continue to weigh whether the Federal Reserve could raise interest rates at some point this year. Investors also continued to digest relatively hawkish comments from a host of central bankers over the weekend at the International Monetary Fund’s Annual Meeting in Lima, urging the Fed to stop putting off an initial rate hike.

GBPUSD dropped broadly after data showed that UK inflation turned negative again in September. GBPUSD had just hit 1.5388 earlier in the session yesterday but is trading over 150 pips lower.

GOLD increased its gains for a 3rd day in a row and broke the all significant resistance at 1170. “Gold is continuing to benefit from the weakness in U.S. dollar and safe-haven buying due to growing uncertainty about the direction of the stock markets.

Today’s main event is the US retail sales for September. Consensus is looking for a 0.3% m/m increase but there are some downside risks to that expectation.

Trading quote of the day:

It’s better to lose your opinion, than to lose your money

EURUSD
Pivot: 1.134
Likely scenario: Long positions above 1.134 with targets @ 1.141 & 1.144 in extension.
Alternative scenario: Below 1.134 look for further downside with 1.1295 & 1.126 as targets.
Comment: The RSI is mixed to bullish.

GBPUSD
Pivot: 1.52
Likely scenario: Long positions above 1.52 with targets @ 1.53 & 1.533 in extension.
Alternative scenario: Below 1.52 look for further downside with 1.517 & 1.5135 as targets.
Comment: The RSI is well directed.

AUDUSD
Pivot: 0.73
Likely scenario: Short positions below 0.73 with targets @ 0.72 & 0.716 in extension.
Alternative scenario: Above 0.73 look for further upside with 0.7345 & 0.738 as targets.
Comment: As long as 0.73 is resistance, look for choppy price action with a bearish bias.