The Currency Market Is Getting Ready For A Recovery

Decline In Market Volumes Will Lead To A Strong Increase In Volatility

Markets collapsed on Tuesday after the release of consumer inflation data in the US. The report has indicated that inflation increased by 0.1% m/m and 8.3% y/y in August, instead of a decline that economists have been expecting.

Of course, traders reacted negatively to the news, primarily because it is likely that the Fed will continue raising rates aggressively in order to curb high inflation. But if the figure declines, albeit gradually, the Fed may consider not a 0.75% rate hike, but a 0.50%. That would return risk appetite and lead to a decrease in both Treasury yields and dollar.

So, positive market sentiment will return, perhaps starting today as an upward movement is seen in European and US stock indices. A rebound is also brewing in the forex market, prompted by the slight weakening of dollar.

That being said, attention should be paid to the data on manufacturing inflation in the US as a slowdown will increase positive market sentiment.

Forecasts for today:

Exchange Rates 14.09.2022 analysis
Exchange Rates 14.09.2022 analysis

AUD/USD

The pair is trading below 0.6725. If negative trends continue in the markets, the quote will continue to decline towards 0.6685.

EUR/USD

The pair is consolidating above 0.9965. Further buying pressure will push it to 1.0100.

Relevance up to 08:00 2022-09-16 UTC+2 Company does not offer investment advice and the analysis performed does not guarantee results. The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Read more: https://www.instaforex.eu/forex_analysis/321648

Decline In Market Volumes Will Lead To A Strong Increase In Volatility

InstaForex Analysis

Instant Trading EU Ltd. is the CFD broker regulated by CySec with license number 266/15.

 

Besides CySEC, Instant Trading EU Ltd. is also supervised by the Czech National Bank (CNB), the Slovak National Bank (SNB), and the Polish Financial Supervision Authority (KNF). Consequently, InstaForex has branches in the Czech Republic, Slovakia, and Poland, where it provides support in local languages. InstaForex is a member of the Investor Compensation Fund (I.C.F) which is an additional security for the client's funds. Besides, the broker ensures the Negative balance protection. So, the reliability and trustworthiness of this broker raise no doubts.

 

Instaforex offers access to more than 2,500 instruments (Stocks CFDs, ETFs, IPOs, Indices, Commodities, Forex, Cryptocurrencies, US Synthetic Stocks) and the MT4 and MT5 platforms, trading accounts in EUR, USD, PLN, CZK, GBP.

 

More information at: www.instaforex.eu

Follow InstaForex on:

Twitter | LinkedIn