NORWAY: Manufacturing IP Momentum Fading In Line With Surveys
Manufacturing industrial momentum has fallen in line with the signals from Statistics Norway’s industrial confidence survey. There are other data that are more consequential for Norges Bank than industrial production, but it still fits with the theme of a modest softening in domestic demand. Next week’s data are very important, with November CPI and the Q4 Regional Network Survey due.
- Manufacturing IP fell 0.9% M/M in October, with a 3m/3m growth at -0.4% for two consecutive months. Although headline IP fell 2.8% M/M (vs +3.7% prior), 3m/3m growth is still positive at 3.4% (vs 2.7% prior).
- In levels terms, it is clear to see a pullback in non-petroleum related manufacturing in recent months, with petroleum-related activities remaining resilient.
- Note that a fading offshore tailwind from next year should see those petroleum-related manufacturing items start to level off in the coming months.
- On a sequential basis, intermediate goods production fell 1.2% M/M (vs -0.3% prior), while capital (0.5% M/M) and consumer goods (0.4% M/M) saw modest upticks after negative prints in September.
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JPY: Mimura Headlines Don't Suggest Intervention An Imminent Risk
Comments crossing from Japan's top currency official Mimura in recent minutes. Seems to have helped USDJPY inch away from session highs.
However, while the comments suggest officials are concerned/are monitoring FX movements, they do not indicate intervention is an imminent risk.
- "*JAPAN'S MIMURA: RECENT YEN MOVES DEVIATE FROM FUNDAMENTALS" bbg
- "*MIMURA: YEN LONG POSITIONS HAVE BEEN SHRINKING AFTER SUMMER"
- "*MIMURA: SPECULATION, GEOPOLITICS, TRADE ALL AFFECTING MARKET"
- "*MIMURA: FX EXCESSIVE VOLATILITY, NOT LEVELS, MAIN CONCERN"
Prior examples of "intervention risk" type comments to watch out for: "We can't tolerate speculative moves."...."We will take appropriate action if needed." ...."We're ready to take action at any time."
BTP TECHS: (Z5) Pullback Appears Corrective
- RES 4: 123.14 1.764 proj of the Sep 3 - 11 - 25 price swing
- RES 3: 122.81 1.618 proj of the Sep 3 - 11 - 25 price swing
- RES 2: 122.53 1.500 proj of the Sep 3 - 11 - 25 price swing
- RES 1: 121.94 High Oct 17 / 22 and the bull trigger
- PRICE: 121.35 @ Close Nov 4
- SUP 1: 120.74 High Aug 5 and a recent breakout level
- SUP 2: 120.60 50-day EMA
- SUP 3: 120.13 Low Oct 10
- SUP 4: 119.48 Low Oct 7
The trend conditions in BTP futures remains bullish and recent weakness is - for now - considered corrective. Note the moving average studies are in a bull-mode position, highlighting a dominant uptrend. The bull trigger is 121.94, the Oct 17 / 24 high. Initial firm support to watch is 120.74, the Aug 5 high. The contract is overbought, a deeper retracement would allow this condition to unwind.
USDJPY TECHS: Trend Needle Points North
- RES 4: 155.89 High Feb 3
- RES 3: 155.53 2.00% retracement of the Jan 10 - Apr 22 bear leg
- RES 2: 154.80 High Feb 12
- RES 1: 154.48 High Nov 4
- PRICE: 153.52 @ 07:08 GMT Nov 5
- SUP 1: 152.96 High Oct 10
- SUP 2: 152.21 20-day EMA
- SUP 3: 150.41 50-day EMA
- SUP 4: 149.38 Low Oct 17
The trend condition in USDJPY unchanged, it remains bullish despite the recent fade off highs. The break higher last week confirmed a resumption of the uptrend and note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 154.80, the Feb 12 high. First important support to watch lies at 152.21, the 20-day EMA. A deeper pullback would be considered corrective.
