Equities Tumble on a Cocktail of Negative Developments

Inflation, Debt Ceiling, and Evergrande Concerns Weigh on Sentiment

The US dollar traded higher against all the other major currencies on Tuesday and during the Asian session Wednesday. The currencies it outperformed the most are GBP, NZD, and AUD, while it eked out the least gains versus EUR.

Nasdaq 100 — Technical Outlook

The Nasdaq 100 cash index fell sharply yesterday and briefly dipped below the low of September 20th, at 14815. That said, the index rebounded somewhat during the Asian session today, returning back above that level. Overall, the index remains below the prior upside support line drawn from the low May 19th, and thus, we would consider the short-term outlook to be negative.

NZD/USD — Technical Outlook

NZD/USD slid yesterday, breaking below the key support (now turned into resistance) zone of 0.6985. This confirmed a forthcoming lower low on the 4-hour chart, and probably the continuation of the short-term downtrend marked by the downside line taken from the peak of September 4th. Thus, we will keep a negative stance.

As for Today’s Events

As we noted yesterday, we have several central bank chiefs speaking at the ECB’s forum on central banking, including ECB President Christine Lagarde, Fed Chair Powell, BoE Governor Andrew Bailey, and BoJ Governor Haruhiko Kuroda. On top of that, it is the second day of Fed Chair Powell’s testimony. He will speak before the House Financial Services Committee. It would be interesting to hear what officials have to say about monetary policy, and whether they will provide any clues or hints with regards to their future plans.

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