Important events today:

17.00 UTC – US: ISM Non-Manufacturing Index.

US 10-year government bond yields are storming to new multi-year highs, which is favourable for dollar strength. On Friday, we will get the labour market release for September, which may come out better than the median forecasts, as US job openings are rising, indicating continued strong demand for staff.

The job vacancy/unemployment ratio has remained virtually unchanged at 1.5x over the past couple of months, indicating an overheated labour market. Against this backdrop, we may see a further rise in long-term government bond yields as strong data will signal an increase in inflation.

Recommendations: Sell 1.0479/1.0520 and TP 1.0380.