Fed meeting, OPEC Plus and PMI data in focus

On Monday, the dollar was up closer to a two-week high as traders bet on a sooner-than-expected rates hike by the Fed. Eurozone markets outperformed in early trade on Monday, and European stocks rose to record highs on the back of upbeat earnings reports.

This week, eyes will be on the Federal Reserve's two-day policy meeting, concluding on Wednesday. Most of the attention will be on whether it will begin to taper its bond-buying. This meeting could also shed light on when the central bank will increase interest rates.

Dollar index heading for annual peak?

In the Monday trading session, the US Dollar Index (DXY) maintains its gains from Friday beyond 94.00, rising to 94.20.

On a further rise, it appears likely that the US Dollar Index will challenge 94.55, which is the year high. After that, DXY buyers will face the next hurdle at 94.75.

The price of crude oil rose Monday as risk assets experienced a broad-based rise that lifted European stocks to new year-to-date highs. The oil market is awaiting the Nov. 4 meeting of OPEC, Russia and their allies, known jointly as OPEC+, with expectations that they will stick to a plan to add 400,000 barrels per day of supply in December.

The US Commodity Futures Trading Commission (CFTC) reported that money managers reduced their net long positions in US crude futures and options in the week ending Oct. 26.

Last week, oil prices rallied to multi-year highs as OPEC+ kept its planned output rather than respond to global supply concerns.

Events of the day

November's nonfarm payroll report will be a key gauge of the recovery's strength following October's disappointing jobs report and the muted GDP number. Approximately 385K new jobs are projected after the NFP missed expectations twice in a row.

There are several PMI reports coming out this week. China already kicked off with the private-sector Caixin PMI, which rose to 50.6 from 50.0 in September, bringing some comfort. Nevertheless, junk bond yields rose to their highest since 2009, and iron ore futures dropped as much as 4% amid ongoing concerns about the outlook for the housing market. The US, UK, Germany and other Euro Zone countries will all report PMIs this week.