A Factsheet on the Key Drivers for the Market Volatility
The Previous trading session was extremely volatile as U.S. dollar appreciated outstandingly against major peer. The most affected pairs were Gold, Silver and BTC. U.S. started the thin vacation on a subdued note but ended it with the lower note. Let me clear it out that fundamentally there was not any negative news in respect to the intense volatility into the FX markets, most possibly mass liquidation looks like the reason behind the tremendous volatility at this point.
- BTC cracked more than 18 pct in a single day and touched $42,900 mark, the day when El Salvador became the first country in the world to adopt BTC as a Legal Tender.
- Several trading platforms were saying they experienced performance issues, although it was not clear if these were a contributor to, or a result of, the volatility.
- Goldman Sachs cut U.S. GDP forecast in the 4th quarter to 5.5 pct from 6.5 pct previously predicted.
- Morgan Stanley cut its rating on U.S. stocks to underweight, pointing to risks related to economic growth, policy and legislation, and warning it expects the next two months to be “bumpy.”
- Australia Dollar was one of the sufferers for unusual market volatility. AUD strengthened sharply after RBA’s Monetary Policy Statement but ended lower at the end of the day.
- Just like AUD, CAD too heavily sold off by the investors ahead of BOC’s Interest Rate Decision due today.
- U.S. government bond yields rose for a second straight day on Tuesday. The benchmark 10-year Treasury note rose as high as 1.385% on Tuesday for the first time since mid-July, a climb of almost 6 basis points from Friday’s close.
- Oil prices fell on Tuesday, pressured by a strong USD and concerns about weak demand in the United States and Asia, although ongoing production outages on the U.S. Gulf Coast capped losses.
Take a look and do trade wisely!