Bearish Reversal Looms as Head and Shoulders Pattern Takes Shape

Central Bank

Economic

Summary:

If this historical price action is repeated, short positions would be favored from this resistance zone, targeting 0.7984, the next local support level.

SELL USDCHF

Close Time

CLOSED

0.80553

Entry Price

0.79850

0.81150

0.80280 -0.00175 -0.22%

8.2

Pips

Profit

0.79850

0.80471

Exit Price

0.80553

Entry Price

0.81150

The latest labor market data from the U.S. continues to signal deceleration. The ADP report indicated that U.S. private payrolls recorded a weekly average decline of 2,500 in the four weeks leading up to November 1st, a notable improvement from the steeper 11,250 average loss observed in the preceding period. Separately, August Factory Orders expanded by 1.4% month-over-month (MoM), which met consensus estimates and successfully reversed the 1.3% contraction recorded in July.

Federal Reserve Governor Christopher Waller adopted a distinctly dovish tone on Tuesday, characterizing the U.S. labor market as "weak" and "near stalling speed." He suggested that the current restrictive policy appears to be dampening economic activity and reiterated his view that a 25 basis point (bps) rate cut at the December 9-10 meeting would provide "additional assurance" for the stability of the labor market.

Adding to the complexity, President Donald Trump reversed previously imposed tariffs on over 200 consumer products, including coffee and orange juice. This decision was reportedly driven by an acknowledgment of the inflationary impact resulting from increased import costs. Despite the economic rationale, the immediate market reaction to this tariff news remained marginal.

Commentary from other Federal Reserve officials remains highly divergent. Vice Chair Philip Jefferson offered cautious, slightly dovish remarks on Monday, acknowledging growing risks to employment. Conversely, Kansas City Fed President Jeffery Schmid argued that the current policy stance is "moderately restrictive," which he deems appropriate to counter demand growth. St. Louis Fed President Alberto Musalem suggested that rates are now closer to neutral than restrictive, emphasizing the limited scope for easing without risking an overly accommodative stance.

In contrast, the Fed’s Thomas Barkin offered a more balanced evaluation, noting that "it’s hard to declare victory on either mandate" and emphasizing that inflation, while above target, is unlikely to re-accelerate. Barkin acknowledged that the labor market is weakening but argued that it may not weaken much further, adding that the job market appears "somewhat softer than the data suggests."

Meanwhile, the Swiss National Bank (SNB) continues to grapple with the headwinds of a strong Franc, weak domestic inflation, and modest economic growth. In comments made earlier this month, SNB Board Member Petra Tschudin stated that the central bank is "in a good position with the current interest rates," noting that inflation projections remain within its target range of 0-2%. She also indicated that the SNB does not currently see a case for cutting rates below zero, though such a move cannot be ruled out if conditions change. Bearish Reversal Looms as Head and Shoulders Pattern Takes Shape_1

Bearish Reversal Looms as Head and Shoulders Pattern Takes Shape_1

Technical Analysis

The USD/CHF pair is displaying a significant technical formation on the candlestick chart known as a Head and Shoulders (H&S) pattern.The appearance of this pattern is a strong indication of a potential trend reversal to the downside. The price recently rallied to 0.8076, a level previously touched on October 9th. On that prior occasion, the price reacted sharply downward from this exact point. If this historical price action is repeated, short positions would be favored from this resistance zone, targeting 0.7984, the next local support level. This target zone is particularly critical as it aligns closely with the 0.618 and 0.50% Fibonacci retracement levels, which often act as magnet targets for significant market pullbacks.

Furthermore, the Relative Strength Index (RSI) has reached a high of 72.97, moving clearly into overbought territory. This extreme reading suggests that bullish momentum is exhausted and could invite bears to take control of the next price movement. The 100-period and 200-period Moving Averages (MAs) are situated at 0.8022 and 0.7998, respectively. These levels sit near the midpoint of the price's recent range since early October, making them a natural magnet for the price toward the primary support zone. Conversely, a strong move above the current local high would invalidate the bearish H&S setup and open the door for a renewed move to the upside.

Trading Recommendations

Trading direction: Sell

Entry price: 0.8053

Target price: 0.7985

Stop loss: 0.8115

Validity: Dec 03, 2025 15:00:00

Risk Warnings and Disclaimers

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Eva Chen

Forex

Summary:

Australia’s wage price index rose 0.8% QoQ in Q3, with the private sector lagging. RBA officials have sounded a hawkish note, and the cash rate is now expected to remain unchanged until 2026.

BUY AUDUSD

Close Time

CLOSED

0.64360

Entry Price

0.66780

0.63700

0.66480 +0.00097 +0.15%

78.9

Pips

Profit

0.63700

0.65149

Exit Price

0.64360

Entry Price

0.66780

Fundamentals

AUDUSD retained its corrective bounce near 0.6464 through the Asian and European sessions on Thursday after printing a five-week low of 0.6450. Persistent hawkish push-back from Reserve Bank of Australia (RBA) officials continues to undergird the currency.

Wednesday’s data showed the wage price index (WPI) advancing 0.8% QoQ in Q3, in line with consensus and unchanged from Q2.

The headline stability masks modest sectoral divergence: private-sector wages grew 0.7% QoQ while public-sector wages rose 0.9% QoQ extending their recent out-performance.

In annual terms, wages were 3.4% higher than a year earlier, matching Q2. Public-sector pay growth ticked up to 3.8% YoY (vs. 3.7% in Q2), whereas private-sector growth slowed to 3.2% YoY from 3.5% in Sep-2024—marking a third consecutive quarter in which public-sector wage momentum has outpaced the private sector.

Market insight: Australia’s YoY wage momentum remains elevated against a backdrop of tight labour markets and anaemic productivity growth, implying that disinflationary progress could be protracted and complicating the policy calculus for the RBA.

RBA has delivered rate cuts on three occasions this year, taking the cash rate to 3.60%, but it retains a data-dependent, cautiously balanced stance. With the labour market still tight and productivity subdued, the policy debate is shifting toward the extent of further easing space. Yet with unemployment near historic lows, tentative signs of inflation re-acceleration and consumer spending running ahead of expectations, the Board is closely monitoring corporate pricing behaviour.

Governor Michele Bullock has hinted that near-term policy easing is unlikely. Our base case is for the RBA to keep the cash rate on hold through 2026.

Still-Elevated Wage Growth and the RBA’s Hawkish Tilt Underpin the Aussie Rebound_1

Technical Analysis

AUDUSD has staged a mild intraday recovery. A break below the 0.6413 region (38.2% Fibonacci retracement of the 0.5913–0.6706 range) would expose the 0.6403 handle and open the door to a deeper bearish extension.

On the upside, a sustained move above the near-term resistance at 0.6517 would neutralise the intraday bearish bias.

Trade Recommendations

Trade Direction: Buy

Entry Price: 0.6436

Target Price: 0.6678

Stop Loss: 0.6370

Valid Until: December 5, 2025, 23:55:00

Support: 0.6464/0.6450/0.6413

Resistance Levels: 0.6492/0.6517/0.6537

Risk Warnings and Disclaimers

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Eva Chen

Forex

Summary:

A Policy Board member signals the Bank of Japan (BoJ) could lift rates "as early as December," while Chief Cabinet Secretary urges vigilance against "one-sided, abrupt FX moves."

SELL USDJPY

EXP

EXPIRED

160.000

Entry Price

153.250

162.500

155.149 -0.196 -0.13%

Pips

EXPIRED

153.250

155.345

Exit Price

160.000

Entry Price

162.500

Fundamentals

Amid the JPY pair falling to its lowest level against USD in roughly ten months, Bank of Japan (BoJ) Policy Board member Junko Koeda on Thursday signaled that a rate hike could come as early as next month and underscored the need to advance interest-rate normalization.

Speaking to local business leaders in Niigata, Koeda said: "Given that real interest rates are currently at a significantly low level, I believe the Bank must proceed with normalizing policy rates."

Following her remarks, JPY extended its decline against USD, suggesting investors may be awaiting a more unambiguous tightening signal. The market consensus now expects the BoJ to raise rates no later than January, while Koeda's comments have reinforced the possibility of a December move.

Separately, Chief Cabinet Secretary Kihara Minoru told reporters on Thursday that the recent one-way, rapid moves in the yen are "a source of concern" and warrant close monitoring. "We need to be vigilant against excessive and disorderly exchange-rate fluctuations," he said, speaking after JPY breached the 157.00 against USD handle to hit its weakest level since January.

A key driver of the stronger dollar and weaker yen has been the ebbing market conviction that the Fed will cut rates in the near term. Kihara stressed that exchange-rate stability grounded in economic fundamentals is essential, opposing sharp moves fueled by speculative flows or market sentiment.

Market watch: The cabinet secretary's warning about "one-way yen volatility" is likely to raise bets on imminent FX intervention. Each time Japanese officials issue such language, traders speculate that the authorities are poised to step in, prompting both longs and shorts to add size in an effort to test the government's threshold. Rather than deterring speculation, this dynamic often fuels two-way whipsaw moves as investors probe "where Tokyo draws the line."

BoJ Hawkish Talk and Government Warning Spark Yen Whipsaw_1

Technical Analysis

USDJPY accelerated to the upside today. The intraday bias remains bullish, with the initial target at the key structural resistance of 158.85, followed by the 161.8% extension of the 149.37–153.26 range at 160.17.

On the downside, a break below the minor support at 155.72 would neutralize the intraday outlook and trigger a consolidation phase before another potential leg higher. The trading strategy for this phase is to position for the next directional move.

Trade Recommendations

Trade Direction: Sell

Entry Price: 160.00

Target Price: 153.25

Stop Loss: 162.50

Valid Until: December 5, 2025, 23:55:00

Support: 158.88/156.76/154.81

Resistance Levels: 158.91/160.21/161.78

Risk Warnings and Disclaimers

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Warren Takunda

Forex

Traders' Opinions

Summary:

The US Dollar strengthened broadly on Thursday as markets slashed expectations for a December rate cut, with hawkish Fed minutes reinforcing a bullish technical setup and positioning the USD Index for a potential breakout toward medium-term resistance.

BUY USDX

Close Time

CLOSED

100.300

Entry Price

102.000

99.000

98.740 -0.210 -0.21%

130.0

Pips

Loss

99.000

Exit Price

100.300

Entry Price

102.000

The US Dollar advanced firmly across major currency pairs on Thursday, lifted by a sweeping repricing of Federal Reserve expectations and a technical landscape that continues to skew in favor of the bulls. The USD Index (DXY) climbed into the 100.35–100.50 region — a critical ceiling that capped upside attempts in May, August, and early November — as investors increasingly retreat from earlier assumptions that the Fed will cut rates again in December.

The move follows the release of hawkish minutes from the Federal Reserve’s latest meeting, which fueled renewed USD demand already supported by risk-averse market sentiment earlier in the week. While the Fed delivered a quarter-point rate cut on October 29, the minutes revealed a surprisingly divided committee, with “many” officials opposing the decision — a signal that policymakers remain hesitant about easing too aggressively while inflation risks linger.

For investors, the message was simple: the Fed is nowhere near unanimous on additional easing, and the December meeting could be far less dovish than the market had priced in. As a result, rate-cut odds receded sharply, giving the Dollar fresh momentum at a time when global growth concerns and softer equity sentiment already favored safe-haven flows.

The Fed’s internal disagreement has forced traders to reassess the policy outlook going into year-end. While October’s rate cut was largely seen as part of a dovish pivot, the minutes suggest the central bank is not prepared to commit to a multi-step easing cycle without more evidence of economic cooling.

The next major catalyst arrives Friday with the long-delayed September Nonfarm Payrolls figures. Economists expect the US economy to have added 55,000 jobs — an improvement from August’s meager 22,000, yet still well below the 2024 monthly average. A stronger-than-expected print would further complicate the case for easing and could embolden USD bulls ahead of the December 10 Fed meeting.

Technical Analysis

From a technical perspective, DXY continues to trade within a well-defined ascending channel, carving out higher lows while maintaining structure above mid-channel support. This pattern has held steady throughout the autumn, with the October rate-cut reaction generating a clean bullish leg that may now be developing into a broader impulsive wave.

The current pullback is unfolding precisely at a key demand zone that aligns with channel support — a confluence typically associated with continuation setups rather than reversals. Higher-timeframe supply remains overhead, yet with structure intact, the narrative increasingly favors additional USD appreciation.

For conviction of a sustained breakout, traders are watching the daily resistance at 100.54. A clean move above this zone — which has repeatedly rejected bulls since May — would open a relatively unobstructed path toward 102.00, a major daily resistance level reinforced by the 50-month SMA. This confluence serves as a clear medium-term target for Dollar bulls and could define the next phase of the USD’s broader recovery.

TRADE RECOMMENDATION

BUY DXY

ENTRY PRICE: 100.30

STOP LOSS: 99.00

TAKE PROFIT: 102.00

Risk Warnings and Disclaimers

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Warren Takunda

Economic

Summary:

EUR/USD extends its losing streak to five sessions, pressured by a surging U.S. Dollar after hawkish Fed minutes slashed expectations for December rate cuts.

SELL EURUSD

Close Time

CLOSED

1.15150

Entry Price

1.14670

1.15700

1.16707 +0.00281 +0.24%

55.0

Pips

Loss

1.14670

1.15701

Exit Price

1.15150

Entry Price

1.15700

EUR/USD extended its decline for a fifth consecutive session on Thursday, sliding to 1.1525 during the European trading hours after failing to hold above the 1.1600 handle on Wednesday. The renewed weakness in the euro comes as the U.S. Dollar continues to assert dominance across the FX board, bolstered by a hawkish tone from the Federal Reserve’s October meeting minutes and a cautious market mood ahead of the September Nonfarm Payrolls (NFP) release.

The Fed minutes, published late Wednesday, reaffirmed policymakers’ strong reluctance to cut interest rates prematurely. According to the document, many officials expressed concern that easing too soon could undermine progress in the inflation fight and risk eroding public confidence in the central bank’s credibility. This marks one of the more hawkish shifts in tone seen in months, effectively cooling a wave of dovish bets that had built up through October and early November.

Market pricing adjusted swiftly. The probability of a 25-basis-point cut at the December 10 FOMC meeting plunged below 30%, down from 50% just a day earlier and more than 90% only a month ago, according to the CME FedWatch tool. The sharp repricing has revived the Greenback’s bullish momentum, with traders re-entering long-dollar positions as U.S. yields stabilize at elevated levels.

The euro, meanwhile, faced its own headwinds. Eurozone Construction Output data revealed a deepening contraction in September, amplifying concerns about Europe’s weakening growth profile. The bloc continues to struggle with feeble industrial activity and softening labor-market indicators, all while inflation trends lower at a pace that underscores policymakers' concerns about stagnation.

Later today, investors will scrutinize Germany’s Bundesbank Monthly Report for fresh insight into the Eurozone’s largest economy, which has been battling persistent manufacturing weakness. Markets will also monitor the European Commission’s preliminary November Consumer Confidence data—figures that could influence sentiment toward the euro should households signal deeper pessimism heading into the winter months.

Across the Atlantic, focus is locked squarely on Friday’s NFP report, with markets looking for clearer signals on the resilience of the U.S. labor market. A stronger-than-expected print would likely reinforce the Fed’s hawkish stance and add further downside pressure on EUR/USD, while a softer figure may offer temporary relief for the pair. The Philadelphia Fed Manufacturing Survey is also on traders’ radar as a secondary risk catalyst.

Technical Analysis

EUR/USD attempted a brief intraday rebound on Thursday, but the bounce appears shallow and primarily driven by oversold conditions on momentum indicators rather than genuine buying conviction. Relative Strength Index (RSI) readings show tentative positive signals, yet the pair continues to trade below a minor descending trendline that has guided price action throughout November.

The broader structure remains decisively bearish. The sustained inability to hold above 1.1600 confirms sellers’ control, with the next notable support zone located near 1.1467. A decisive break below that level would open the door to deeper losses, particularly if U.S. data continues to outperform Eurozone figures.

TRADE RECOMMENDATION

SELL EURUSD

ENTRY PRICE: 1.1515

STOP LOSS: 1.1570

TAKE PROFIT: 1.1467

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

GBP/JPY holds firm near multi-month highs above 205 as the Yen weakens amid fading intervention fears and expectations of a large fiscal stimulus in Japan, while softer UK inflation raises questions about the Bank of England’s rate-cut path.

BUY GBPJPY

Close Time

CLOSED

205.782

Entry Price

208.000

204.500

207.063 -0.037 -0.02%

128.2

Pips

Loss

204.500

204.496

Exit Price

205.782

Entry Price

208.000

The British Pound extended its advance against a broadly weaker Japanese Yen on Thursday, with GBP/JPY holding comfortably above the 205 handle as mounting policy divergence and renewed fiscal speculation in Tokyo kept the Japanese currency under sustained selling pressure.

The cross, which briefly touched a fresh 16-month high just above 206.00 earlier in the week, has since eased slightly but remains supported near 205.75 at the time of writing. The pair found strong buying interest around 205.35—its previous year-to-date peak—suggesting that bullish sentiment is still firmly anchored despite a temporary loss of upside momentum.

The Yen’s latest depreciation continues a trend seen over the past several sessions, driven primarily by waning concerns about foreign-exchange intervention and renewed expectations of aggressive fiscal action in Japan. Investors, who had previously speculated that Tokyo might step into markets to curb rapid Yen weakness, appear more confident that authorities are currently reluctant to act.

That view was reinforced on Wednesday when Finance Minister Satsuki Katayama stated that she had not discussed currency matters during a meeting with Bank of Japan Governor Kazuo Ueda. Markets interpreted the remark as a sign that policymakers remain comfortable with the current exchange-rate dynamics, even as the Yen trades near historically weak levels against major peers.

At the same time, Japanese media reports suggesting that Prime Minister Sanae Takaichi is preparing a stimulus package worth roughly $21 billion added further downward pressure on the currency. The proposed measures—intended to help households manage persistent cost-of-living pressures—would come as Japan grapples with rising inflation and limited fiscal room. For traders, the prospect of an additional fiscal boost implies further strain on public finances and the possibility of sustained monetary-policy accommodation, both of which weigh on the Yen.

In contrast, the macroeconomic backdrop in the United Kingdom remains mixed. UK inflation data released Wednesday showed consumer prices slowing to 3.6% year-on-year in October, easing from the 3.8% pace recorded over the previous three months. While still above the Bank of England’s 2% target, the continued deceleration bolsters expectations that policymakers may proceed with additional rate cuts over the coming months. That prospect has capped some of the Pound’s upside momentum, though the currency remains well supported against the Yen given Japan’s comparatively more dovish stance.

Technical Analysis

GBP/JPY continues to show a constructive technical profile, having already met the 2.00% Fibonacci extension level at 205.25—an initial upside target highlighted in earlier analyses. The pair’s recent consolidation appears to reflect a temporary pause as markets await renewed bullish momentum.

A sustained break and daily close above the current resistance zone would strengthen the case for a continuation of the uptrend, potentially opening the path toward 206.70 and ultimately the next medium-term target around 208.00. Failure to overcome this resistance, however, could trigger short-term volatility or a corrective pullback, with 203.70 acting as a key support to watch.

For Thursday’s session, the expected trading range is projected between 204.45 and 205.70, with the broader trend bias remaining firmly bullish.

TRADE RECOMMENDATION

BUY GBPJPY

ENTRY PRICE: 205.80

STOP LOSS: 204.50

TAKE PROFIT: 208.00

Risk Warnings and Disclaimers

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Alan

Cryptocurrency

Summary:

Recently, institutional outflows from Bitcoin have surged, while technical indicators have broken downward. In the short term, Bitcoin is likely to continue its decline.

SELL BTC-USDT

Close Time

CLOSED

92141.6

Entry Price

78000.0

96000.0

91250.0 +1695.2 +1.89%

7960.6

Pips

Profit

78000.0

84181.0

Exit Price

92141.6

Entry Price

96000.0

Fundamentals

The most significant fundamental change for Bitcoin is the large-scale outflow from institutional investors.

According to reports by Reuters and CoinDesk, BlackRock's flagship Bitcoin ETF (IBIT) recorded a record single-day net outflow of $523 million. This exacerbated the cumulative net redemptions seen throughout the month, pushing the total ETF outflows to the billions of dollars level. The shift to net outflows directly weakened spot market buying power, causing the price to briefly break below the key psychological level of approximately $90,000. The pace of institutional outflows has also exposed previously marginal long positions—those that entered the market via ETFs—to selling pressure. Data from Bloomberg also shows that the average entry cost for recent new investors is around $89,600. This means that as prices fall, it could trigger a cascade of stop-loss and short-selling orders, further amplifying volatility.

In addition, macroeconomic factors are compounding sentiment: the Federal Reserve's interest rate outlook isn't noticeably dovish, and the U.S. dollar remains strong, reducing the appeal of risk assets. At the same time, concerns over an "overheated capital withdrawal" and deleveraging force some short-term arbitrage and leveraged positions to close, contributing to the downward momentum. While large-scale redemptions from ETFs are the immediate trigger, the broader macro capital flows are the key determinants of Bitcoin's medium-term direction.

Technical Analysis

After Breaking Below $99,000, Where Will Bitcoin Go Next?_1

Based on the daily chart, Bitcoin broke below the key support level of $99,000 last Friday, opening up further downside potential. The first major downside target may be around the $75,000 support level. Moreover, the continued downward trend over recent trading sessions indicates that bearish sentiment currently dominates the overall market.

At present, the key resistance zone is around $95,000. If Bitcoin fails to hold firmly above this area, it will be difficult for bulls to regain control in the short term. The near-term support zone lies between $86,500, and a break below that could see the next historical buying zone near $80,000 reactivated. Trading volumes have expanded during declines but remained weak during rebounds, suggesting that current rallies are more likely to be technical pullbacks after forced liquidations, rather than signs of sustained buying by capital inflows.