Date : 26th September 2022.

Market Update – September 26 – Sterling Slumps.

Trading Leveraged Products is risky

*USDIndex – surged to 114.40 before settling at 113.64. 10-year yields jumped 5.5 bp in Australia and are currently 7.6 bp higher in the US. 2-year Treasury yields broke above 4.3% to a new 15-year high.
*EUR – The Eurozone and the wider EU are also facing the challenge of a new right-wing government in Italy, with Draghi’s likely successor not only the first woman, but one with far-right convictions that could bring her in conflict with Brussels and Frankfurt. EURUSD at 0.9635.
*JPY Japan’s Finance Minister threatened further intervention today, but the Yen was again under pressure and fell about 0.6% to the weaker side of 143.86.
*GBP dropped to an all-time low against the USD (at 1.033) as Friday’s mini-budget intensified concern about the fiscal situation. Speculation of an emergency response from the Bank of England, as confidence evaporated in Britain’s plan to borrow its way out of trouble, spooked investors piling into US Dollars. Currently settled at 1.0615.

*Stocks: Eurozone stock futures are selling off in tandem with US futures, while the UK100 future has found a footing as the slump in Sterling lends a helping hand. Across Asia the Nikkei closed -2.6% lower, the ASX declined -1.6% and Hang Seng and CSI 300 have lost -0.02% and -0.52% respectively so far.
*USOil plunged to $77.58 as recession concerns mount. Attention turns to OPEC+, on Oct. 5, after agreement to cut output modestly at their last meeting.
*Gold – drifted to $1636, with next floor at $1560.
*BTC – hovering around 2-month low at $18k area.

Overnight & Today – China steps up fight to support the Yuan. The PBOC announced today that it will impose a 20% risk reserve requirement on banks’ foreign-exchange forward sales to clients. The currency is heading for the lower end of the allowed trading band against the Dollar, despite stronger than expected fixings since August. Officials also reduced the banks’ foreign-currency reserve requirements earlier this month to boost the Yuan, but so far, the measures haven’t really halted the slide in the currency and today’s move is also not expected to do much more than slow the slide.

Biggest FX Mover @ (06:30 GMT) EURGBP (+2.19%). Topped at nearly 2-year highs at 0.9250, before correcting back to 0.9045. Intraday MAs aligning lower, MACD histogram & signal line hold positive, RSI declines to 61, H1 ATR 0.0065, Daily ATR 0.0094.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.