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Forexlive Americas FX News Envelope: 2-10 Years Approaching Reversal.  Nasdaq 200W MA review


Markets started the New York session with a wall of worry and pain at elevated levels.

  • The S&P was looking to open in bearish territory (-20%).
  • The Nasdaq was down more than 32% from its all-time high.
  • Yields rose further as a weekend of reflection on the CPI and what it might mean for Wednesday’s FOMC decision pointed further and further towards 75 basis points (do I mean 100? ).
  • The dollar was rising
  • Bitcoin was in shock after a bitcoin lender Celcius announced over the weekend that it was closing redemptions. Does the house of cards fall?

Things didn’t improve as the day progressed.

  • In US stocks, the Nasdaq index traded below its 200-week MA for the first time since the pandemic. This 200 week MA comes in at 10795. The low reached 10775 before bouncing off the close to finish at 10809.24. The 200-week MA will be a key barometer for Wednesday’s Fed decision. The Nasdaq is down -33.3% from its all-time high.
  • For the S&P, it indeed closed in bearish territory at -22.18%. All 11 S&P sectors are now down for the month. For today, the best performing sector was Consumer Staples at -2.18%. The worst performing sector was energy with -5.13%. This is despite the rise in the price of crude oil by around $0.16. Luckily crude oil is not falling that day.
  • The Vix volatility index rose from 27.75% to 35.05% from Friday. Traders look for volatility up to 40+. At least it’s within earshot as traders start to panic a bit.
  • McDonald’s was the only Dow stock that was positive for the day. at +1.16%. The top 10 losers in the Dow today looked like this:
Today’s Top 10 Dow Losers
  • In the US debt market, yields rose about 12 basis points in early trading. At the end of the day, the 2-year was up almost 30 basis points to 3.37% and the highest level since November 2007. The 10-year yield is trading up 22 basis points at 3.379%. It’s his highest level since April 2011. The 2-10 year old flaunted his back a screaming inverted distance for the 2nd time this year. A Wall Street Journal article contributed to the rise by saying: “A series of worrying inflation reports in recent days is likely to lead Federal Reserve officials to look at surprising markets with an increase in interest rates. Interest was 0.75 percentage points higher than expected at their meeting this week,” Barclays and JP Morgan have since raised expectations for a 75 basis point hike on Wednesday from 50 basis points.

Forexlive Americas FX News Envelope: 2-10 Years Approaching Reversal.  Nasdaq 200W MA review

US yields jumped with a 29 basis point rise over 2 years

In forex, the USD moved higher against all major currencies (including the JPY which is up late in the day in the USDJPY). The dollar made new session highs against the EUR, GBP, CHF, CAD, AUD and NZD in the past hour of trading. The USD was virtually unchanged against the JPY (as troubled traders always turn to the JPY), but rose 0.92% (against the CAD) and 1.8% (against the to AUD).

Forexlive Americas FX News Envelope: 2-10 Years Approaching Reversal.  Nasdaq 200W MA review

Strongest to weakest major currencies

In other markets:

  • spot gold fell -$51 or -2.74% to $1,819.69
  • Spot Silver fell -$0.78 or -3.53% to $21.08
  • WTI Crude Oil is trading up $0.16 or 0.13% at $120.83
  • Bitcoin is off its low of $22,600, but is still significantly below $23,260


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