<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/broader-market-sentiment-is-holding-up-so-far-today-20220927/“>Broader market sentiment is holding up so far today</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/feds-evans-getting-inflation-under-control-is-the-priority-20220927/“>Fed’s Evans: Getting inflation under control is the priority</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/feds-evans-says-expects-to-raise-rates-further-and-hold-stance-for-quite-a-while-20220927/“>Fed’s Evans says expects to raise rates further and hold stance for quite a while</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/ecbs-centeno-rate-hike-cycle-will-continue-20220927/“>ECB’s Centeno: Rate hike cycle will continue</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/nord-stream-operator-says-three-offshore-pipelines-have-sustained-unprecedented-damages-20220927/“>Nord Stream operator says three offshore pipelines have sustained „unprecedented“ damages</a></li></ul><p>Markets:</p><ul><li>NZD leads, USD lags on the day</li><li>European equities higher; S&P 500 futures up 1.3%</li><li>US 10-year yields down 7 bps to 3.811%</li><li>Gold up 1.1% to $1,639.73</li><li>WTI crude up 1.2% to $77.65</li><li>Bitcoin up 5.8% to $20,215</li></ul><p style=““ class=“text-align-justify“>We’re seeing a bit of a breather in markets as the broad selling everywhere hits pause for a bit of a correction. The dollar is lower as it retraces a small part of its recent gains and the pound capitalised on that, with GBP/USD climbing up over 1% on the day as the rout in gilts also encounter a pause. That said, cable is still only settling just above 1.0800 at the moment. Pain. 🤕</p><p style=““ class=“text-align-justify“>EUR/USD is up 0.4% to 0.9645 with the high earlier touching 0.9670 but the gains aren’t anything to shout about as the single currency is still reeling after having hit a 20-year low against the dollar. Meanwhile, USD/JPY is down 0.3% to 144.30 but buyers are still in a good spot to try and contest the 145.00 mark again – where the BOJ/MOF intervened last week.</p><p style=““ class=“text-align-justify“>Commodity currencies are holding higher as the more positive risk mood today is also helping. That said, the moves pale in comparison to the recent selling with USD/CAD at 1.3675 even though down 0.4% and AUD/USD near 0.6500 even with a 0.6% advance. NZD/USD is a decent mover, up 1.2% to 0.5705 but that comes after having hit its lowest levels since the early days of the pandemic yesterday.</p><p style=““ class=“text-align-justify“>Equities are finding some relief from the recent selloff but I would say a lot of this can be attributed to calmer tones in the bond market as the heavy rout stalls for the time being. 10-year gilt yields are down 12 bps to 4.13% while 10-year Treasury yields are down 7 bps to 3.81% and that is providing broader markets with some reprieve – at least for now.</p><p style=““ class=“text-align-justify“>European indices and US futures are showing a modest bounce but it doesn’t take away from the downside pressure in recent weeks. And as is the case in familiar times such as these, it doesn’t take much for sentiment to go cowering again.</p>

This article was written by Justin Low at forexlive.com.

<ul><li>There is no de-anchoring of inflation expectations in Europe</li></ul><p style=““ class=“text-align-justify“>We already know that the ECB will at least hike again in October but the question is how much? There’s still a debate between 50 bps and 75 bps that needs to be settled.</p>

This article was written by Justin Low at forexlive.com.

<ul><li>DAX is an equity market index that tracks the performance of the 40 most important blue chip businesses based in Germany that trade on the Frankfurt Stock Exchange.</li><li>Some traders follow the DAX as a „tell“ and signal for US equities, as well, among other primary signals.</li><li>In the following DAX technical analysis video, and trade idea, I show an anticipation for a low probablity but high reward vs risk potential trade, whereby a support that many others (mainly trading algos) are watching.</li><li>When a support is broken, new bears start taking shorts, and previous bulls get stopped out. All of this means more selling. But when they sell, they need to sell their contracts to another participant. So who is buying? Mostly institutional firms, many of which see the retail traders as fish and themselves as sharks that want to eat them. The big sharks are even <a target=“_blank“ href=“https://www.investopedia.com/terms/p/paymentoforderflow.asp“>buying order flow data</a> from platforms like <a target=“_blank“ href=“https://robinhood.com/us/en/“ target=“_blank“>RobinHood</a></li><li>When most retailer traders see a support broken, they go short. many of the others that held on to their Long, sell and exit. This means that we can assume that new sell orders will be accumilating by the herd. Now, they may be right, and the might be wrong. No one really knows, and I do not know, either. But what we can assume is that those sharks have a temptation to take the chips from the fish, and, thus, are motivated to manipulate the price to the other direction. That other direction means to be a contrarian.</li><li>But do not get the wrong idea, this concept still goes against the trend. If buying pressure was so strong for a variety of reasons, then buyers would not wait for price to cross down the support. Buyers would be rushing in to buy, beforehand.</li><li>Accordingly, going against this trend implies that the probablity of winning in this trade is lower than 50%. Sometimes, much lower. How low? Nobody knows. This is where trading becomes a mix of an art and science rather than just art or science.</li><li>If a trade presents a relatively low probablity, then it must demonstrate a relatively high reward vs risk ratio. Otherwise, why take it?</li><li>Here is a situation, IMHO, that merits this concept, as I aim for a 4 to 1 reward vs risk</li><li>This DAX trade idea still allows a healthy room for the stop, as the following DAX technical analysis video shows</li></ul><p>Trade the DAX at your own risk and follow ForexLive.com for additional ideas and perspectives in <a target=“_blank“ href=“https://www.forexlive.com/technical-analysis“>technical analysis</a>. Last but not least, let me know what you think of the DAX or this trade idea in the comment section below, where possible updates to this technical analysis may be provided in the near future. Thank you.</p>

This article was written by Itai Levitan at forexlive.com.

<ul><li style=““ class=“text-align-justify“>My outlook is roughly in line with Fed median assessment of rates at 4.25% to 4.50% at year-end</li><li style=““ class=“text-align-justify“>At some point, it will be appropriate to slow the pace of rate increases and hold rates for a while to assess the impact on the economy</li><li style=““ class=“text-align-justify“>Our actions will result in below-trend growth and softening of labour market</li><li style=““ class=“text-align-justify“>But fialing to restore price stability would result in far greater costs</li><li style=““ class=“text-align-justify“>Many of the risks to the Fed’s outlook appear to be on the downside</li><li style=““ class=“text-align-justify“>Expects <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_1″ class=“terms__main-term“>inflation</a> to cool substantially over the next couple of years</li><li style=““ class=“text-align-justify“><a target=“_blank“ href=“https://www.chicagofed.org/publications/speeches/2022/september-27-omfif“ target=“_blank“ rel=“nofollow“>Full speech</a></li></ul><p style=““ class=“text-align-justify“>All of this isn’t anything new and with Evans saying that his view is more or less in line with the general FOMC outlook, there isn’t much to really look too much into the remarks above. The only thing perhaps is the soft landing versus hard landing debate but then again, the Fed is in a much, much better position to avoid that argument for now as compared to the likes of Europe and the UK at least.</p>

This article was written by Justin Low at forexlive.com.

<p class=“MsoNormal“>Bitcoin is down 4.1% over the past week,
ending near $18,900. Ethereum lost 5.8% to $1290. Other leading altcoins in the
top 10 showed mixed dynamics, ranging from a 3.7% decline (Cardano) to a 27% increase
(XRP). </p><p class=“MsoNormal“>
Total crypto market capitalisation, according to CoinMarketCap, declined by
2.4% over the week to $928bn. Cryptocurrency Fear & Greed Index fell by 3
points over the week to 24 („extreme fear“).</p><p class=“MsoNormal“>
Meanwhile, the cryptocurrency market became a safe haven compared to the
collapse of major currencies and stock indices.</p><p class=“MsoNormal“>
The beginning of the week raises the question, what is behind the relative
resilience of cryptos? This market could be forgotten for a while, as all the
attention and capital flows are on flagship assets. Alternatively, it could
manifest traders‘ inner confidence that peak fear is near and cryptocurrencies
are already cheap enough for long-term investors.</p><p class=“MsoNormal“>News background</p><p class=“MsoNormal“>Former MicroStrategy CEO Michael Saylor said
that bitcoin would surpass the $69K reached in November 2021 in the next four
years. BTC could trade as high as $500K in the next decade if its market
capitalisation equals that of gold. Judging by bitcoin’s simple four-year
moving average, its bottom is at $20K, Sailor suggested.

Bitcoin’s bear market has yet to reach its final stage, and investors should
prepare for further declines. Some participants expressed this opinion in a
Cointelegraph poll on Twitter.</p><p class=“MsoNormal“>
Ethereum co-founder Vitalik Buterin said all cryptocurrencies should switch to
the Proof-of-Stake (PoS) algorithm. He believes that over the next 18 months,
ETH will become much more scalable, which will significantly reduce transaction
fees.</p><p class=“MsoNormal“>Ripple CEO Brad Garlinghouse disagreed with the SEC that Ethereum could be
considered unregistered security after the move to PoS.</p>

This article was written by ForexLive at forexlive.com.

<p>From the news statement:</p><p>“A statement is expected from the Bank of England today, Sky News understands. It comes after a morning of unprecedented turbulence for the pound, which has fallen to historic lows. There are concerns that this could fuel inflation, something the Bank of England is tasked with keeping under control.“</p><p style=““ class=“text-align-justify“>Keep your eyes and ears peeled. GBP/USD is now down 0.8% on the day to 1.0770, very much steadier after having plunged to a record low earlier in Asia trading of 1.0357.</p>

This article was written by Justin Low at forexlive.com.

<ul><li>Have seen positive reaction from business groups to fiscal statement</li><li>Finance minister will come forward with medium-term fiscal plan in the coming months</li><li>Do not know when the next conversation between BOE and Kwarteng will be</li></ul><p style=““ class=“text-align-justify“>When asked about any plans to change measures set out in the „mini budget“, the spokesperson responded with a ’no‘. I guess the ball is over in the BOE’s court now then. With intervention via FX reserves not a sound option, it seems like the central bank can only intervene through raising interest rates substantially – that is if they see fit to step into the market.</p>

This article was written by Justin Low at forexlive.com.

<p style=““ class=“text-align-justify“>The pound may be stealing the spotlight but the dollar is continuing to go about its own business as it is pushing higher across the major currencies board once more in trading today. GBP/USD is now down 1.3% to 1.0710 after <a target=“_blank“ href=“https://www.forexlive.com/news/cable-recovers-some-poise-now-down-only-a-little-over-1-20220926/“ target=“_blank“>a bit of a bounce</a> from the lows earlier but the pressure valve is still not turned off yet with no word from the BOE so far.</p><p style=““ class=“text-align-justify“>Elsewhere, EUR/USD is down 0.4% to 0.9655 but at least off earlier lows of 0.9570 while USD/JPY is up 0.5% to 144.00 again as buyers stay poised in search of another potential test of 145.00 following the BOJ/MOF intervention last week.</p><p style=““ class=“text-align-justify“>Commodity currencies are also staying pressured as equities are slumping. USD/CAD is up 0.3% to 1.3635 while AUD/USD is down 0.4% to 0.6500 as the dollar continues to hold firmer across the board.</p><p style=““ class=“text-align-justify“>S&P 500 futures briefly pared losses in early European morning trade but are now back down by 0.9%. The June lows are in the crosshairs of sellers and a break below that will heap added pressure on risk sentiment to start the new week:</p><p style=““ class=“text-align-justify“>In Europe, <a target=“_blank“ href=“https://www.forexlive.com/news/uk-bonds-are-imploding-20220926/“ target=“_blank“>UK bonds are imploding</a> and regional indices are also down across the board. The rout is very much a continuation of the sell everything mood in markets from last week, with 10-year Treasury yields also seen up 8 bps to 3.778% currently.</p>

This article was written by Justin Low at forexlive.com.

<p style=““ class=“text-align-justify“>That’s roughly $25 billion and eats into the country’s FX reserves of about $1.29 trillion at the end of August, according to official reserves data. In any case, the final figure will be made available on Friday when the Ministry of Finance announces the total it spent for intervention this month.</p>

This article was written by Justin Low at forexlive.com.

<p>The dollar is king with the EURUSD trading to the lowest level since 2002. The GBPUSD traded to the lowet level since 1985. The AUDUSD, NZDUSD and the NZDUSD traded to the lowest level since the 2020 pandemic plunge. Even the USDCHF rallied despite the 75 basis point hike. The USDJPY rebounded Friday and is back at neutral short term technical levels even after a BOJ intervention this week. </p><p>The trend to the upside in the USD is strong but corrections can be brutal. So I look at the technicals that might take some of the tarnish off the greenback in the new trading week. It is important to know the trend, but it is important to know the enemy as well. The enemy is a technical bounce. </p><p>The pairs I look at technically in the video, and the start times for each:</p><ul><li>EURUSD 8:55</li><li>GBPUSD 12:22</li><li>USDJPY 15:30</li><li>USDCHF 18:00</li><li>USDCAD 20:00</li><li>AUDUSD 22:11</li><li>NZDUSD 24:22</li></ul>

This article was written by Greg Michalowski at forexlive.com.