Fundamental Analysis
Focus on Private Data
With the government shutdown and the suspension of official BLS figures, markets are turning to private indicators. ADP showed a loss of 32,000 jobs in September, JOLTS reported 7.227 million vacancies with weaker hiring and lower quits, and the ISM manufacturing employment index came in at 45.3, while the services employment component in August was 46.5.
Labour Market Outlook
Reduced hiring and lower labor rotation are easing wage pressure, even though hourly earnings rose 0.3% m/m and 3.7% y/y. This suggests an orderly slowdown: wage inflation could gradually ease, limiting pressure on rates and resulting in mixed movements across risk assets and safe havens, such as equities and gold. If the White House proceeds with mass layoffs of federal employees, unemployment would likely increase further, intensifying pressure on the Fed to cut interest rates.
Shutdown Risks and Fed Outlook
If the shutdown extends beyond October 12, October’s NFP data would be compromised. This could lead to falling payrolls and consumption, more volatility, and temporary USD strength. The Fed is unlikely to act “blindly”: without reliable official data, it will likely keep rates steady in October while monitoring labor conditions and the broader economy. Under this scenario, the USD could strengthen until clarity on the labor market emerges and the need for monetary easing is reassessed.
Technical Analysis
DXY | H4
Supply zones (sellers): 97.87 | 97.73
Demand zones (buyers): 97.26
After bouncing from a weekly demand zone, the index consolidates with a final POC around 97.73. A move below 97.73 may trigger declines toward 97.38 and 97.00, maintaining bearish pressure on USD majors. A recovery above 97.73 and 97.87 could push the index toward 98.11 (weekly open), extending gains to 98.55 and 98.78.
USDJPY | H4
Supply zones (sellers): 147.94 | 148.57
Demand zones (buyers): 147.16 | 146.34
The pair is trading above the weekly volume concentration at 147.16, a demand zone offering support for a potential rebound toward 147.94. A breakout above this level could extend buying toward 148.57 and the weekly open at 149.49.
*Exhaustion/Reversal Pattern (ERP): Before entering trades at key zones, always wait for confirmation of an ERP on M5, as shown here 👉 https://t.me/spanishfbs/2258
*POC explained: Point of Control (POC) is the price level where the highest volume concentration occurred. If followed by a bearish move, it is treated as resistance; if followed by a bullish move, it acts as support.
