Erik Schafhauser Zürich

Morning Brew September 8 2021

Morning Brew 1 minute to read
Erik Schafhauser

Senior Relationship Manager

Summary:  USD rises on higher yields and technical failure to break resistance.


Good Morning,

Yesterday proved to be more interesting that initially anticipated, we saw The USD gaining across the board but Crypto, Gold and Silver particularly hard hit. Bitcoin fell to near 42.000 before recovering to 46500 and Ethereum dropped to near 3.000- Gold and Silver fell to 1791 and 24.15 before recovering to 1797 and 24.35. US 10 year rates rose to almost 1.40 yesterday supporting the USD, the USD index gained to 92.6 from a low of below 92 just Friday. EURUSD is trading at 1.1830.

With regards to Gold, Ole Hansen states that the repeated failure to breach the 1835 and the relatively limited interest by money managers a strong rally seems not to be imminent. Positive  impact comes from central banks and investors moving away from cash to avoid negative interest rates.

The Stock market remained calmer than FX with US Indexes closing mixed, Tech curiously gained (the Nasdaq ended up 0.07%),  the S&P 500 and the Dow fall 0.34 and 0.76% respectively. The Dax dropped from neat 16000 to 15840.

The moves are particularly interesting before the ECB meeting tomorrow where it is possible that that the ECB begins the tapering process before the Fed does. I had mentioned this before, the Bundesbank is not happy with the elevated inflation levels. It is worth to note that while the ECB may reduce the PEPP that was launched to alleviate the impact of the Pandemic, the older APP remains in place.

El Salvador introduced adopted Bitcoin as official tender yesterday and picked a bumpy day for it. Rumors state that IT issues it the country sparked sharp drop while other sources cite technical with the market failing to reise above 53k sparking profit taking and compounding sales. The U.S. SEC is threatening to sue Coinbase if the company launches a program allowing users to earn interest by lending crypto assets.

Japan reported a better than expected GDP at 1.9% vs 1.3% expected.

Today the only economic event of note is the Canadian rate decision at 16:00 CET. Watch out for nervousness like we saw yesterday on any hint on ECB or US policy adjustments.

 

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank (Schweiz) AG
Beethovenstrasse 33
CH-8002
Zurich
Switzerland

Contact Saxo

Select region

Switzerland
Switzerland

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved, we have put together a general Risk Warning and a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed here or within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.