Stock futures gain as Bitcoin nears key moving average; dollar and oil slip

U.S. equity futures are pointing to a firm open for the new trading week. After last week's declines, the major indexes recovered some ground on Friday, with the Nasdaq 100 leading the rebound. The Dow Jones Industrial Average did not participate in that bounce and is now set to add roughly 559 points at the opening bell. The key question is whether buyers can extend those gains once cash trading begins.

Crude oil has moved back under $90 a barrel after President Trump played down the likelihood of fresh military action against Iran so long as diplomatic efforts continue. Reuters reported recent attacks on vessels near the Strait of Hormuz, leaving supply risks intact. Treasury yields are climbing across the curve this morning. Equities are benefiting from cheaper oil, while the bond market is looking ahead to Tuesday's U.S. CPI release, with the 10-year yield hovering near 4.87%.

The U.S. dollar is losing ground against all seven major currencies tracked here. The New Zealand dollar leads the gains, rising 1.15% against the greenback, followed by the British pound at 0.50%, the Australian dollar at 0.47% and the euro at 0.39%. The dollar's losses are more modest against the yen, Canadian dollar and Swiss franc. The kiwi began strengthening in Asian trading after New Zealand's closely contested election, with special votes still uncounted and a final outcome expected by November 27.

In a technical review of EURUSD, USDJPY and GBPUSD, I outline the directional bias, key risk levels and targets that could shift control between buyers and sellers for each pair.

The technical outlook

EURUSD. Buyers hold the intraday advantage. The pair is trading at 1.1186, above the midpoint of today's range near 1.1168 and right at the 200-hour moving average. The 100-hour moving average at 1.12046 is another key objective that would strengthen the bullish case.

USDJPY. Sellers have the upper hand after the price broke below the 100-hour moving average at 158.178 and the 200-hour moving average at 157.973. Staying below those levels would keep the bias in favor of sellers.

GBPUSD. Buyers are seeking greater control as the price rebounds above the 100-day moving average at 1.3392, the 200-hour moving average at 1.3400 and the 50% retracement at 1.35056. The pair is testing the 200-day moving average at 1.34177 but remains below the 100-hour moving average at 1.3432.

Currency ranges

Using the latest session highs and lows against the 22-day average ranges:

• EURUSD — 1.1138 to 1.1197, 59 pips or 72% of average.

• USDJPY — 157.86 to 158.53, 67 pips or 78% of average.

• GBPUSD — 1.3350 to 1.3422, 72 pips or 97% of average.

• USDCHF — 0.8175 to 0.8212, 37 pips or 55% of average.

• USDCAD — 1.4078 to 1.4138, 60 pips or 105% of average.

• AUDUSD — 0.6856 to 0.6905, 49 pips or 98% of average.

• NZDUSD — 0.5550 to 0.5616, 66 pips or 138% of average.

USDCHF has the most room to extend on this metric. EURUSD and USDJPY also have upside potential if their session extremes are breached. GBPUSD and AUDUSD have already covered nearly a full day's average range, while USDCAD and NZDUSD have exceeded theirs. A pair can continue trending after reaching its average range. I use that figure to gauge how much ground has already been covered before deciding where to place risk.

Stocks are higher in US and Europe while bond yields are modestly higher

US stock futures

• Dow +559 points

• S&P 500 +68 points

• Nasdaq 100 +226 points

Friday’s close

• Dow −0.46%

• S&P 500 +0.31%

• Nasdaq Composite +1.09%

• Nasdaq 100 +1.35%

European equities are broadly higher, with Italy recording the strongest gains. Benchmark 10-year yields are lower across major European markets, diverging from the rise in U.S. yields.

• Germany’s DAX +1.08%

• France’s CAC 40 +0.79%

• UK’s FTSE 100 +0.65%

• Spain’s IBEX 35 +1.52%

• Italy’s FTSE MIB +2.13%

US Treasury yields

• 2-year 4.5469%, up 2.49 basis points

• 5-year 4.6661%, up 1.81 basis points

• 10-year 4.8718%, up 1.28 basis points

• 30-year 5.2645%, up 0.45 basis points

Crude oil falls helping equities, while metals move higher

U.S. crude oil is trading at $88.31, down $2.52 or 2.77%, after hitting a low of $87.54. Spot gold has risen 1.27% to around $4,122, silver is up 1.67% near $52.77, and copper is 1.71% higher at $6.3440. Gold's advance alongside higher Treasury yields is notable, particularly given the broadly weaker dollar.

Bitcoin approaches its 200-day moving average

Bitcoin fell to $73,650, its lowest since August 21, before recovering to roughly $74,821. That low was just $497 above the 200-day moving average of $73,153. August 21 was also the last time bitcoin traded below that moving average.

The first downside target is back at $73,650. A break below that would put the 200-day moving average in focus. That level is a key gauge for both buyers and sellers. If the price tests the average and bounces, buyers gain a level to lean against with defined risk. A sustained break below would give sellers more control. Should the price break below and quickly reclaim that level, I will watch for a failed breakdown.

Binance is also in the spotlight. The exchange announced Saturday that CFO Kaiser Ng is leaving for another opportunity and that Justin Yek, formerly with Airwallex, will succeed him. Co-CEO Yi He said the transition had been planned for six months. The announcement came after the October 29 theft of roughly $6.3 billion in cryptocurrency. Binance stated that attackers compromised employee computers via malicious downloads and fake recruiting efforts targeting engineers, and the exchange committed to fully reimbursing affected customers. The FBI attributed the theft to a North Korean group, though Pyongyang denied involvement.

The breach puts Binance's security measures and reimbursement process under scrutiny. For bitcoin, the key question is whether buyers can defend the August low and the 200-day moving average if the price declines again.

North American calendar

• 8:40 AM ET – Fed Vice Chair for Supervision Michelle Bowman speaks.

• 10:00 AM ET – US September wholesale inventories – Forecast +0.6% – Previous +0.5%.

• 10:00 AM ET – Chicago Fed President Austan Goolsbee speaks.

• 11:00 AM ET – New York Fed Survey of Consumer Expectations.

• 12:15 PM ET – Richmond Fed President Thomas Barkin speaks.

• 1:00 PM ET – US Treasury 3-year note auction.

The main test for the dollar and yields comes Tuesday at 8:30 AM ET with the U.S. October CPI release. Today I am watching whether the dollar remains under pressure even as U.S. yields rise. A move through the session highs in EURUSD and GBPUSD would indicate that buyers are still willing to push that trade ahead of the inflation data.