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MTrading Team • 2022-10-25

NZDUSD outshines in dormant markets ahead of crucial data/events

NZDUSD outshines in dormant markets ahead of crucial data/events

Global markets remained dicey during early Tuesday, fading the week-start optimism, as traders await the key central bank decisions. Even so, the yields remained pressured amid fears of recession, especially emanating from China and Europe. 

With this, the US dollar struggles to defend the previous day’s rebound while NZDUSD ignores downbeat comments from an RBNZ official. On the other hand, the Chinese Yuan refreshed a record low while GBPUSD remains mildly bid to welcome Rishi Sunak as the UK Prime Minister.

Prices of crude oil portray economic slowdown fears by extending the week-start losses whereas gold also remains pressured amid the recently firmer US dollar.

Early signals of Terra Luna-type crypto plunge weighed on the BTCUSD but ETHUSD appears defensive as Ethereum’s Merge probes bears.

Following are the latest moves of the key assets:

  • Brent oil extends the week-start losses to $93.00, 0.91% intraday at the latest.
  • Gold price also remains pressured, down 0.25% around $1,645 by the press time.
  • USD Index picks up bids to tease buyers around 112.00, mildly bid of late.
  • FTSE prints mild losses but Eurostoxx and DAX are both positive around 0.60% intraday by the press time.
  • Wall Street closed with mild gains, led by Dow Jones.
  • BTCUSD and ETHUSD are both on the bear’s radar while declining to $19,300 and $1,330 at the latest.
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Unclear markets test traders

A record low of the Chinese yuan and downbeat global PMIs joined geopolitical fears to challenge the optimists early in the week. However, the softer yields and mildly positive equities portrayed mixed markets. With this, the sentiment remains sensitive as traders await monetary policy decisions from the ECB, BOC and BOJ. Also important to watch are the numbers for the US Consumer Confidence, Australian CPI and the US Q3 GDP.

It should be noted that the latest talks in the markets aren’t fulfilling the US dollar bull’s demands as traders sense easing rate hikes and the start of the Quantitative Tightening (QT). Even so, the money market wagers on a 75 bps rate hike at major central banks keep the risk aversion in play.

Overall, a lack of clarity could challenge the traders ahead of the top-tier data/events.

Elsewhere, a $100 million rug pull by Freeway joins Apple’s tough crypto rules to challenge the BTCUSD and ETHUSD bulls. However, optimism surrounding Merge and hopes of more investments from Asia favor some of the cryptocurrencies.

⏫ 🟢 Strong buy: USDJPY

⏬ 🔴 Strong sell: ETHUSD

⬆️ 🟢 Buy: USD Index, USDCAD, Nasdaq, EURUSD

⬇️ 🔴 Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD

US Consumer Confidence eyed

While risk catalysts are the key to gauging the market’s next moves, today’s US CB Consumer Confidence numbers may help traders to overcome the early-day inaction. Also important will be the bond market moves and the US dollar’s reaction to the same.

Overall, the sluggish markets are in fashion as bears flex their muscles before the crucial catalysts.

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