The growing risk appetite among market participants has been evident since the beginning of the week, following news that the US House Speaker, "Nancy Pelosi," is optimistic that the proposed stimulus package will be finalized this week after discussions with Treasury Secretary "Steven Mnuchin."

Mnuchin, in an interview with Fox Business News, stated that he rejected the $2.2 trillion stimulus package proposal put forward by the Democratic Party, instead favoring around $1.5 trillion. Mnuchin mentioned that an agreement on the stimulus amount has been reached and hopes it can be disbursed in the near future.

“Both sides have come a long way to reach an agreement. The rhetoric is decent and I think we are getting closer to getting a stimulus package passed,” said Sean Callow, FX strategist at Westpac.

Callow added that the stimulus package agreement will improve the mood of market participants to return to risk assets, including the emerging market currency market, thus weakening the Greenback. At the same time, the market's risk appetite is further emphasized by the positive report of September private sector employment data which increased better than expected and the surge in Chicago manufacturing which reached the highest level in recent years.

In addition, the release of several other US economic data, such as GDP and core inflation, was not as bad as initial expectations, raising hopes for a faster US economic recovery from the pandemic's impact. The following are the economic data to be released on Thursday, October 1, 2020:

  1. The US economic stimulus bill has not yet reached an agreement, with spokespeople from both parties requesting more time for further discussions, causing the US Dollar to weaken overnight.
  2. The report of shrinking US crude oil reserves helped boost prices overnight.
  3. USDJPY seems to be rising after the Tankan manufacturing index report showed poor results earlier this morning.
  4. USDCHF has the potential to move following the release of the CPI and Retail Sales report at 13:30 WIB and the manufacturing index at 14:30 WIB.
  5. EURUSD also awaits a series of manufacturing index data from its member countries, which will be released from 14:45 - 15:00 WIB. Followed by the PPI report and unemployment rate at 16:00 WIB.
  6. GBPUSD also awaits the manufacturing index report at 15:30 WIB.
  7. USDCAD gets its turn for the manufacturing index report at 20:30 WIB.
  8. The US Dollar has the potential to move due to the release of personal spending data and weekly jobless claims at 19:30 WIB, followed by the ISM Manufacturing Index report at 21:00 WIB.

Daily Pick

grapik 1 okt 20 Dollar AS

Today's prediction is on the GU pair (GBPUSD) is expected to continue its increase, and the recommended OP is BUY at level 1.29400. With a profit target of 10 - 20 points and a stop loss of 5-10 points.

  • BUY 1.29400
  • TP 1 = 1.2950 (10 Point)
  • TP 2 = 1.2960 (20 Point)
  • SL 1 = 1.2935 (5 Point)
  • SL 2 = 1.2930 (10 Point)

Always prioritize Money Management and Risk Management.

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