<p style=““ class=“text-align-justify“>The early gains have evaporated and equities have tilted lower in European morning trade. S&P 500 futures are now down 12 points, or 0.3%, holding near the lows for the day while European indices have also nudged lower. The DAX is down 0.6%, CAC 40 down 0.7%, and UK FTSE down 0.1% upon returning from the long weekend.</p><p style=““ class=“text-align-justify“>This is keeping the pressure on commodity currencies with the dollar holding firmer alongside higher Treasury yields today. That said, we’re still sitting in the confines of key technical levels as mentioned <a target=“_blank“ href=“https://www.forexlive.com/news/dollar-up-against-the-apex-20220920/“ target=“_blank“>here</a>.</p>

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

<ul><li>2-year Treasury yields +2.2 bps to 3.968%</li><li>5-year Treasury yields +1.6 bps to 3.709%</li><li>10-year Treasury yields +2.9 bps to 3.518%</li><li>30-year Treasury yields +3.8 bps to 3.543%</li></ul><p style=““ class=“text-align-justify“>It looks like the rates market is still siding with a more hawkish Fed ahead of the main event tomorrow. Yields are continuing to push higher on the week with 2-year Treasury yields hitting 3.97% – its highest since November 2007. The dollar didn’t take much cue from bonds yesterday but is looking steadier so far today with USD/JPY also up 0.3% to 143.65 at the moment.</p><p style=““ class=“text-align-justify“>The Fed remains the driving force for the next key move but with markets already inching towards 4% rates, it will take some added convincing from Powell & co. to drive another push higher surely – same might be said for the dollar as well.</p>

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

<p class=“MsoNormal“>During the last few months, the crypto
market has been keeping traders on the edge of their seats. Unfortunately, it
has not been the best year for <a target=“_blank“ href=“https://xpromarkets.com/product-specifications/“ target=“_blank“>popular cryptocurrencies</a>, as assets such as
Bitcoin and Ethereum have reached record-breaking lows. However, what seems to
keep traders invested in maintaining their trading positions in the crypto
market is that despite the extreme volatility experienced in 2022, the booming
crypto market still manages to have a solid presence among traders around the
world. </p><p class=“MsoNormal“>At <a target=“_blank“ href=“https://xpromarkets.com/“ target=“_blank“>XPro Markets</a>, we’ve
gathered the latest data and most important highlights of the crypto market’s
movements so far this year, so you can get a better understanding of what is
happening to your crypto CFDs and what are the reasons behind this volatility.
Keep reading to find out more!</p><p class=“MsoNormal“>Crypto
Market Overview Q2 2022</p><ul><li>During the second quarter of 2022,
Bitcoin drops 56%, its worst performance in a decade.</li><li>A cumulative change of -$501.8 billion
was recorded in crypto market capitalization, falling to $337.5 billion.</li><li>A record decline of eleven weeks led to
a 67.4% decline for Ethereum in Q2. As a result, Ethereum’s cumulative market
cap declined by $265.79 billion, to $128.62 billion.</li></ul><p class=“MsoNormal“>Currently, cryptocurrencies are holding
on, trying to stay above average-price levels. If you consider that in 2021
Bitcoin’s price had surpassed 65,000 USD and now it is struggling to maintain
its ground over the 20,000 USD barrier, you can understand how challenging this
year has been for this trending crypto.</p><p class=“MsoNormal“>Top
Reasons the Cryptocurrency Market Is Crashing</p><ol><li>The effects of inflation: As prices
rise across the board, people might be pulling their savings from non-essential
investments – which, for many, include cryptocurrencies. Q3 also enhanced
recession fears, making crypto traders even more sceptical when it comes to
investing in such assets.</li><li>Russia-Ukraine War: In times of major
geopolitical uncertainty, people tend to invest in safe, conventional, and
consistently reliable assets. This has resulted in increased volatility in the
cryptocurrency market, turning traders away from the challenge of crypto
trading.</li></ol><p class=“MsoNormal“>Will
it ever go up again?</p><p class=“MsoNormal“>If you’re a crypto CFD trader you’re
probably wondering what you should be doing in these turbulent times. We’ve got
good news and bad news. The bad news is that you can never be 100% sure about
what’s going to happen to the markets in the future, as every <a target=“_blank“ href=“https://xpromarkets.com/economic-calendar/“ target=“_blank“>economic event</a> can impact your
assets. </p><p class=“MsoNormal“>The good news is that there are ways to
be more prepared when things go sideways. In every challenge, it’s important
for traders to maintain their discipline and not lose confidence in their
skills. Therefore, what can keep you one step ahead of the markets? Patience –
Practice – Perseverance.</p><p class=“MsoNormal“>Keep <a target=“_blank“ href=“https://portal.xpromarkets.com/login“ target=“_blank“>boosting your trading
skills</a> and discover ways to enhance your <a target=“_blank“ href=“https://xpromarkets.com/trading-ebooks/“ target=“_blank“>trading strategies</a>, while also
staying up to date with economic events that could impact your trades. </p>

This article was written by ForexLive at forexlive.com.

<p style=““ class=“text-align-justify“>The implied odds of a 100 bps rate hike by the Fed this week have crept back up a little to ~19% now, roughly where it was before the UMich report at the end of last week <a target=“_blank“ href=“https://www.forexlive.com/news/umich-september-us-prelim-consumer-sentiment-595-vs-600-expected-20220916/“ target=“_blank“>here</a>. Those are still relatively paltry odds but the fact is that markets are leaning towards expecting more from the Fed – with the baseline set at a 75 bps rate hike.</p><p style=““ class=“text-align-justify“>I reckon that might say something about the reaction to the policy decision later in the week, with markets seemingly leaning towards a more hawkish message to cover for the extra that is being priced in above.</p>

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

<ul><li>German economy is already contracting</li><li>Situation to get worse as gas consumption is cut or rationed</li><li>The economy is likely to shrink even if outright rationing is avoided</li><li style=““ class=“text-align-justify“>Economic activity may pull back somewhat this quarter and shrink markedly in autumn, winter months</li></ul><p style=““ class=“text-align-justify“>The bright spot is that they do not expect the adverse scenario published in June, which saw the economy contracting by 3.2% next year, to materialise at least. But nonetheless, a looming recession will keep the dark clouds hanging over the euro in the months ahead and the gas/energy crisis will only be amplified again next year.</p>

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

<ul><li>Monetary policy always tries to act to fight inflation</li><li>Further interest rate increases will depend on economic data</li></ul><p style=““ class=“text-align-justify“>There’s still some time before next month’s policy meeting decision on 27 October, so I reckon we might get a better sense of what the ECB wants to do then. Another 75 bps rate hike is plausible as money markets have priced in roughly ~70 bps for both October and December, though rate cuts are already being priced in as well for late next year.</p>

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

<p style=““ class=“text-align-justify“>The recipe for what is needed to bring things under control in the US, without incurring a recession that is:</p><p style=““ class=“text-align-justify“>The question now is whether we will see a soft landing or hard landing when it comes to how much the economy is going to slow down as lawmakers and policymakers try to bring inflation under control. Ideally, they’d like the former but there are many moving parts to determining that – not to mention factors outside their control such as China’s situation.</p><p style=““ class=“text-align-justify“>In some sense, central banks are in the driver’s seat as their management of tighter policy is akin to shifting through the gears in determining the speed in which we are going to be dealing with said economic challenges. Goldman Sachs‘ take is that they see the Fed hiking by 75 bps this week followed by two more 50 bps rate hikes in November and December:</p>

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

<ul><li>Prior -1.2%</li></ul><p style=““ class=“text-align-justify“>Looking at the details, building construction increased by 0.3%, while civil
engineering decreased by 0.6%. It’s a decent recovery after the drop in June but other areas of the euro area economy are less optimistic basing off Q3 figures so far.</p>

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

<p>A Goldman Sachs note from later Friday (info via Reuters) has analysts at the bank making more pessimistic forecasts ahead due to a more aggressive Federal Reserve tightening policy through the rest of this year:</p><ul><li>“higher rates path combined with recent tightening in financial conditions implies a somewhat worse outlook for growth and employment next year“</li></ul><p>Goldman Sachs have revised their projection for next week’s Federal Open Market Committee (FOMC) meeting. GS expects the FOMC to hike 75 basis points, up from 50 basis points previously.</p><ul><li>sees 50 bp hike in November</li><li>sees 50 bp hike in December</li><li>sees the fed funds rate peaking at 4-4.25% by the end of 2022</li></ul><p>-</p><p>Economic forecasts:</p><ul><li>sees GDP growth of 1.1% in 2023 (down from its preivous tip of 1.5% growth from the fourth quarter of 2022 to the end of 2023).</li><li>unemployment rate at 3.7% by the end of 2022 (from prior call of 3.6%), to 4.1% by the end of 2023 (from 3.8%)</li></ul><p>Sep, Nov, & Dec dates below:</p>

This article was written by Eamonn Sheridan at forexlive.com.

<p>Breakout or Fakeout? There are reasons to see the USD moving even higher after 4 currencies made new multi-year lows vs the USD last week. Can the USD buying momentum continue in the new trading week?.</p><p>In this video, Greg Michalowski, talks of the breaks and why they occurred and then looks at the technicals that will keep the momentum of the break going OR fakeout the dollar buyers – at least in the short term. </p>

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