Today’s Key Market Drivers: 23rd October 2018
“US 10 Year Treasury Yields climb to 3.2% again pushing up the US Dollar.”
My opening comment in this report yesterday came as a question. Can the S&P 500 stock index continue to stay above its 200 EMA on the daily chart? The answer on Monday was no with the S&P closing down 0.5% on the back of a very weak banking sector lead lower by one of the world’s largest banks – Bank of America.
The Pound was the biggest loser of the majors on Monday with traders again selling off the Queen’s currency as Brexit negotiations continue to drag on without resolution. According to CNBC, Prime Minister Theresa May on Monday said that 95% of Britain’s Brexit deal has been agreed to but repeated her opposition to an EU proposal for the Irish border, according to excerpts from her statement to Parliament. The GBP v USD slipped below a key technical level against the US Dollar, which I point out in my daily video update. The Euro also fell on Monday as traders continue to be concerned about Italy’s budget.
Asian stock indexes were higher with the Shanghai index in China up a whopping 4% which helped the Aussie and Kiwi Dollar higher. The rally in China can be attributed to a report that said the Government pledged to support the Chinese economy. Gee, what a revelation that is! The trend higher on the Aussie Dollar continued in the first few hours of the European trading session, however, the rally reversed through the US session with a strengthening in the US Dollar as the 10 Year US Treasury Yield rose to 3.2% again.
There is no high impacting economic news scheduled for Tuesday and with a weak lead from Wall Street I suspect the rally we saw yesterday across Asian stock markets may subside. Unlike Monday’s gains any fall on Asian markets today will likely mean any attempted rally on the AUD and NZD may struggle to get going. The next piece of noteworthy news for the market to watch is a speech by Bank of England Governor Carney. He is due to speak at 2.20am AEST Wednesday morning and his comments have the potential to influence the Pound.
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About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
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