In This Issue

• FX Recap: Fed holds with two dissents for a hike, euro at lowest since May 2025, USD/JPY rebounds

• EUR/USD: New low since May 2025, bullish divergence

• USD/JPY: Back above the 50-day, volatility compressed, momentum neutral

• Gold: Broke the double bottom, new low, momentum still lower

• Crude: Sells off on Iran peace talks to the 50% Fibonacci, uptrend intact

• BTC: Below the 50-day, testing the 100-day

• Week Ahead: RBA and US midterms Tuesday, BoE Thursday, US payrolls Friday

FX Recap

The dollar finished the week little changed. The Fed held at 3.75% to 4.00% on a 10–2 vote, with both dissents wanting a hike. Warsh didn’t commit to a December hike, and markets price about an 80% chance of one. US Q3 GDP grew 3.4% against 3.2% expected, and September core PCE was in line.

The ECB held, and Lagarde said a December hike is still likely. EUR/USD hit its lowest level since May 2025 at 1.1104 on Thursday and finished the week near 1.1157.

The BoJ held at 1.25% and raised its inflation forecast. USD/JPY recovered to about 157.6. The BoC hiked to 2.50%.

Tech stocks fell again, led by Alphabet on Thursday, and Treasury yields dropped. Crude sold off on Monday on positive developments toward peace talks with Iran, after making a new high on Friday.

EUR/USD

EUR/USD traded down to its lowest level since May 2025 at 1.1104 but ended the week mostly unchanged from the start of the week. The key thing to watch is the bullish divergence printed on the new low, with momentum noticeably higher than on the previous new low in mid-October. The new low came on October 29, which also printed a bullish engulfing pattern. EUR/USD looks to be running out of steam on this move lower and may be due for a bigger retracement.

Key Levels

Resistance

• 1.1264 upper Bollinger Band

• 1.1338 38.2% Fibonacci (August high to last week’s low)

• 1.1379 50-day moving average

Support

• 1.1128 lower Bollinger Band

• 1.1104 last week’s low

USD/JPY

USD/JPY also finished last week close to where it started, at 157.58. It’s now back over the key 50-day moving average and held on a closing basis on both Friday and Monday. Monday rallied up to the next key level at 157.93 (20-day moving average). Volatility remains compressed, so watch for price action to stay bound within the Bollinger Bands (157.00 to 158.86). Momentum is also showing no bias, sitting right at neutral and pointing sideways.

Key Levels

Resistance

• 158.57 200-day moving average

• 158.86 upper Bollinger Band

• 159.20 100-day moving average

Support

• 157.42 50-day moving average

• 157.00 lower Bollinger Band

• 156.07 last week’s bullish reversal bar low

Gold (GCZ6)

Gold broke the double bottom flagged last week at 3,989.1, making a new low of 3,879.3. Momentum is still oversold and pointing lower, and volatility is expanding, suggesting there’s still room to test lower.

Key Levels

Resistance

• 4,097.2 last week’s high

• 4,108.4 20-day moving average

Support

• 3,931.0 lower Bollinger Band

• 3,879.3 Friday’s low

Crude (CLZ26)

Positive developments on a potential peace agreement with Iran drove a selloff in crude on Monday after it made a new high on Friday. The selloff went down to the 50% Fibonacci level (95.50) of the move from the October 6 low to Friday’s high. The key moving averages (50/100/200) are all still trending higher, suggesting the supportive big picture is still intact even with the current weakness.

Key Levels

Resistance

• 98.84 last week’s channel bottom/support

• 104.99 Friday’s high

• 106.22 upper Bollinger Band

Support

• 95.50 50% Fibonacci

• 93.25 61.8% Fibonacci

• 91.28 50-day moving average

BTC

The 50-day moving average has been pivotal for BTC. Price crossed back below it and closed below on October 22 for the first time in 2 months. Since then it has acted as resistance. Last Wednesday price had a bearish engulfing candle after touching the 50-day moving average at 81,881. It’s now testing the next support at 76,731 (100-day moving average). This level is also near the 38.2% Fibonacci support.

Key Levels

Resistance

• 78,757 Sunday’s reversal bar high

• 81,366 50-day moving average

• 84,769 October 21 high

Support

• 76,731 100-day moving average

• 72,589 50% Fibonacci (July low to September high)

• 69,102 61.8% Fibonacci

Week Ahead

The main focus this week is the Bank of England on Thursday and US payrolls on Friday. A BoE hike is widely expected, so the vote split and guidance matter more than the decision. Payrolls matter for December Fed pricing, with hike odds near 80%.

The RBA decides Tuesday, the same day as the US midterm elections.

Meridian Compass is brought to you by Mark Schaefer, a portfolio manager specializing in systematic global macro and FX strategies, with experience across institutional trading platforms, major banks, and hedge funds.

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This newsletter is for educational purposes only and does not constitute investment advice, trading recommendations, or solicitation to buy or sell any financial instruments. All content represents the author's personal opinions and experiences and should not be construed as professional financial advice.

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