Inflation data from UK and US are today’s highlights. UK inflation hit 1.0% in September, the highest since late 2014. Analysts see this as beginning of broader increase in prices, as BOE’s Governor Carney said last week that the central bank will tolerate an overshot against its inflation target at 2%, to help accommodate economic growth and employment.
Pound jumped after upbeat data and remains tall against the US dollar, with strong 1.2270 resistance being cracked post-data move.
US inflation rose by 0.3% in September from 0.2% in August, according to expectation, on rising gasoline and rents prices, suggesting a steady build up of inflation that could keep the Fed on track for rate hike towards the end of the year.
However, underlying inflation showed signs of softening. Core CPI which excludes food and energy costs came at 0.1% in September against 0.3% climb in August that slowed y/y increase of core CPI to 2.2% in September following rise of 2.3% in August.
The US inflation data somewhat disappointed markets, as the dollar fell across the board immediately after data release.
Foreign Exchange

EURUSD Initial attempts to firmly break above 1.1000 barrier run out of steam at 1.1025. Subsequent pullback was contained at 1.0988 that keeps near-term bulls in play for renewed attempts higher. Above 1.1025, good barriers lay at 1.1036/48, ahead of pivots at 1.1085 and breakpoint at 1.1120.
Overall structure remains negative and sees renewed attempts towards key 1.0950 support after completion of corrective phase.

GBPUSD gained momentum on upbeat UK data, but is so far unable to clearly break above key n/y barrier at 1.2270, as upticks so far stalled at 1.2300. Next solid barriers lay at 1.2337 and 1.2377, guarding pivot at 1.2400. Supports start from 1.2245, through 1.2218, towards 1.2174.
AUDUSD maintains strong bullish stance on Tuesday, following 0.87% rally until now. Uninterrupted five-day rally eyes target at 0.7708, with 0.7730/58 seen in extension. First support lies at 0.7660, followed by 0.7646 and 0.7620 pivot.

USDJPY continues to struggle on sustaining break above 104.00 level, which marks significant point. Near-term price action moves around 104.00, with several unsuccessful attempts to clearly break above 104.43 pivot, keeping the downside vulnerable for now. (104.43 Fibo 61.8% of 107.47/99.52 downleg).
Initial support at 103.66 holds for now, with break lower to expose 103.26, ahead of 102.79 pivot.

Commodities

US CRUDE OIL is holding above $50 handle on bounce from Monday’s low at $49.46, which so far guards pivot at $49.36 and breakpoint at $49.14. Near-term recovery attempts are lacking strength for further upside, with $50.50 resistance zone capping for now and keeping the downside vulnerable.
First support is at $50.00, ahead of $49.46/36 and key $49.14. At the upside, $50.50 barrier guards $51.12 and ket $51.58 barrier.

GOLD trades at the upper zone of near-term congestion and probed briefly above range’s top at $1262. Strong 200SMA barrier currently lies at $1265 and only sustained break here would sideline downside risk in favor of extended recovery towards $1277/80 barriers.
Initial support lies at $1257, followed by $1252 and $1250.
Stocks
European stocks opened higher and rallied strongly on Tuesday.
FTSE100 is up 1.23% on bounce from Monday’s low at 6898 and came ticks ahead of psychological 7000 barrier.

German DAX opened with gap-higher on Tuesday and gained 0.85% from opening. Target at 10683 and 10696 are in near-term focus.
French CAC-40 index touched former triple-top at 4515, on bullish extension after Tuesday’s gap higher opening and gained 0.80% so far
Wall Street is expected to open higher on Tuesday, following strong bullish sentiment in European stocks and on stronger-than-expected quarterly reports, including from Netflix and Goldman Sachs, Market Analysis