This is what you need to know to trade today Thursday September 29:
The US dollar index DXY lost more than 1% on Wednesday, the 10-year Treasury yield fell 5.5% and Wall Street’s main indexes gained between 1.9% and 2%. However, the market correction appears to be over now, with the DXY index rising above 113.50 and US stock index futures trading in negative territory. The Eurozone business and consumer sentiment data and German HICP figures will serve to give a new impetus during the European session. In the second half of the day, the US Bureau of Economic Analysis will release the final reading on growth in the Annualized Gross Domestic Product of the second trimester.
During the Asian session, Reuters has reported that the China’s Ministry of Finance had planned to issue some 2.5 trillion yuan ($347.4 billion) in government bonds. in the fourth trimester. This news has helped the Shanghai Composite Index to limit its losses on Thursday, but markets remain risk averse in the early hours of the European session.
The EUR/USD he gained more than 100 points on Wednesday, but has already retraced much of the previous day’s rally. Several people responsible for the monetary policy of the European Central Bank (ECB) indicated that a rate hike of 75 basis points in October would be convenient. However, the sour sentiment in the markets and the renewed strength of the dollar do not allow the pair to shake off the downward pressure. At time of writing, EUR/USD is down 0.9% on the day, trading at 0.9645.
Behind the Bank of England (BoE) intervention in the Gilt market, GBP/USD moved sharply and ended up closing the day in positive territory above 1.0800. The BoE said it would carry out temporary purchases of long-term UK bonds to restore orderly market conditions. However, the UK central bank said the Monetary Policy Committee’s annual target of reducing securities by £80bn would not be affected. Meanwhile, various media outlets reported that the British government had no plans to reverse its fiscal policy and that Finance Minister Kawsi Kwarteng would not resign. Asked about the markets’ reaction to the mini-budget early on Thursday, British Prime Minister Liz Truss said she believed the government had done the right thing. As the markets closely follow the latest developments in the UK Gilt markets, the GBP/USD down 1% on the day below 1.0800.
With the market’s attention focused on the British pound and the bond markets, the USD/JPY posted small daily losses on Wednesday. Supported by the rebound in US yields, USD/JPY is positioned in positive territory slightly below 145.00 on Thursday.
The Prayed took advantage of the sharp drop in US yields on Wednesday and rose nearly 2%, posting its biggest one-day gain since March. With the US 10-year yield up more than 3% in early Thursday, gold is unable to consolidate Wednesday’s gains and is now down 1% on the day at $1,643.
The Bitcoin It was up nearly 2% on Wednesday, but lost its upside momentum before testing $20,000. At the time of writing, BTC/USD is trading in a tight range above $19,000. The ethereum it struggled to make a decisive move in either direction on Wednesday and closed the day largely flat. ETH/USD remains under modest downward pressure and is now trading just over $1,300.
Source: Fx Street