Bitcoin staged a genuine rally on Monday, rapidly breaking above $87,000 and peaking at $87,381 during the U.S. session — the highest level since late January. Although the coin corrected to about $85,500 at the start of Asian trading on Tuesday, the surge completed a 13% advance over four days and pushed total crypto market capitalization back above the symbolic $3 trillion mark — for the first time this year. But what underlies this bullish triumph: real fundamentals or merely technical inevitability?

The immediate fuel for the rocket was a massive wave of forced liquidations. According to Coinglass data cited by CoinDesk, more than $1 billion of leveraged crypto positions were wiped out in 24 hours.

Bears took the brunt: about 82% of liquidated volume (roughly $840 million) came from short sellers. Some 135,000 traders were forced to lock in losses. The most painful hit was a nearly $21 million Bitcoin liquidation on the Hyperliquid platform.

"It looks like mechanics did it rather than conviction. Bitcoin pierced the upper boundary of its September range and entered a dense zone of short-liquidation levels, and forced buying finished the rest," notes Rachel Lucas, an analyst at BTC Markets.

She adds that $84,000 has now become a critical support level. It will show "whether this is a genuine trend reversal or just a short squeeze." However, blaming everything on a mechanical squeeze would be a mistake. The market also caught a powerful macroeconomic and regulatory tailwind:

Institutional Hunger

Spot Bitcoin ETFs in the U.S. drew about $1 billion on Monday — the largest single-day inflow since October.

Deregulation by the SEC

Last Thursday, the regulator granted a five-year exemption allowing trading of tokenized U.S. equities on blockchain platforms. That sparked euphoria among crypto-related companies: Coinbase shares rose 3.5%, and MicroStrategy gained 9.5%.

Geopolitics and Oil

WTI fell more than 2%, dipping below $90/bbl on news that Iran may be willing to reopen the Strait of Hormuz. Cheaper oil reduced inflation fears and reignited risk appetite.

Wall Street Triumph

The Nasdaq Composite closed Monday at a record high.

Corporate Purchases

MicroStrategy resumed Bitcoin buying for the first time in three weeks, acquiring 950 BTC for $75.7 million. Their treasury now holds a colossal 846,000 BTC.

The rally lifted the entire market. Ethereum neared a 10-month high at $2,800, XRP gained over 9%, Dogecoin jumped 15%, and meme-coin PEPE led the pack with a 22% rise. The Fear & Greed Index moved into "Extreme Greed."

Open interest in perpetual futures swelled to nearly $160 billion (a peak since late October), despite the short-covering purge. New leveraged positions are actively replacing the old ones.

Experts warn the market is walking a tightrope. Caleb Lin, senior trader at QCP Group, notes that when "leverage outpaces spot prices," even a small pullback can trigger a cascade of liquidations in the opposite direction.

Despite the euphoria, Bitcoin remains far below its all-time high of $126,000 set in October last year. Several analysts urge calm.

"Risk is that this is macro-liquidity trading dressed up as crypto. If so, the slightest wobble in risk assets will put significant pressure on Bitcoin," warns Rich Rosenblum, co-founder of crypto market-maker GSR. Blockchain analytics firm Santiment echoes the concern, recording that optimistic social-media commentary has reached its highest level since 2024.

The main engine of USD/CAD's rise is the monetary-policy divergence between the Bank of Canada and the Federal Reserve. At its September meeting, the Bank of Canada once again left the policy rate at 2.25%, while the Fed raised the federal-funds range to 3.75%–4.00%. The resulting interest-rate gap is already about 150–175 basis points in favor of the US dollar. Moreover, the Fed's updated median projection this month implies a year-end policy rate near 4.1%. A large majority of FOMC members expect at least one more 25-bp hike at one of the remaining meetings this year (likely in December).

One key factor weighing on the loonie is the inflation picture. The September 14 CPI print initially looks stiff: headline CPI in August held at July's level of 3.0% year-on-year, i.e., near the upper bound of the BoC's tolerance. However, the release's structure is much less hawkish. Gasoline inflation eased to 22.8% y/y (from 25.7%), food inflation fell from 3.1% to 2.8%, and the transport component eased to 7.5% (from 7.8%). Apparel and footwear inflation slowed markedly from 2.4% to 1.2%. Importantly, headline CPI was negative month-on-month in August (-0.1% vs a 0.0% forecast).

So the "3.0%" headline in the Canadian CPI is somewhat misleading. The higher overall inflation is largely explained by the energy component, while there is no broad-based, persistent acceleration in price pressures. Core measures remain much closer to target and well below headline CPI: CPI-median is 2.0%, CPI-trim 1.9%, and CPI-common eased to 2.6% (from 2.7%). The inflation impulse is still concentrated in energy and some services rather than spreading evenly across the economy.

This character of inflation is consistent with the Bank of Canada's cautious stance. At the September meeting, the BoC left the policy rate at 2.25%, noting the economy appears to operate with some excess supply and the labor market shows signs of weakness. The Governing Council also acknowledged rising inflation risks and warned that if elevated energy prices pass through more broadly, further tightening may become necessary.

In short, a rate hike at the BoC remains possible but is not the baseline scenario for now. At the same time, the widening policy gap and persistent oil-price uncertainty continue to favor USD/CAD appreciation.

Against this backdrop, the contrast with the Fed's stance becomes even more pronounced. The US central bank not only raised rates but effectively signaled one more hike before year-end. Fed officials noted resilient domestic demand, strong productivity growth and persistently elevated inflation.

Thus, the interest-rate differential works in the US dollar's favor. While the Bank of Canada must weigh a weak economy and excess supply, the Fed has room for further tightening. For USD/CAD, this factor remains the primary driver of the uptrend.

The oil market also works against the loonie on Tuesday. Crude prices are falling on reports of potential restoration of shipments through the Strait of Hormuz and prospects for renewed US-Iran diplomacy. That is negative for the loonie because lower oil prices typically reduce support for the commodity-linked Canadian dollar.

This means USD/CAD buyers receive support from two sides: first, the persistent Fed-BoC policy gap in favor of the dollar; and second, the easing of the oil-driven inflation argument that had helped the loonie.

Moreover, continued de-escalation in the Middle East would likely increase pressure on the loonie, since lower oil prices would remove one of Canada's key supports. Cheaper oil would ease inflationary pressure in Canada and lower the odds of further BoC tightening. In those conditions, the decoupling of Fed and BoC policy positions becomes the main driver of USD/CAD appreciation.

Technically, the pair is at the upper Bollinger-Band on the H4 and D1 timeframes and sits above the Ichimoku lines. On the weekly chart, the pair is between the middle and upper Bollinger-Band. A decisive break above 1.4050 (H4 upper Bollinger-Band) would open the way toward the next barrier around 1.4110 (monthly Kijun-sen). Given the prevailing fundamental backdrop, it is reasonable to consider long positions on south-side pullbacks in USD/CAD.

Housing construction led the expansion after last year's recession; public administration, manufacturing and wholesale trade also made positive contributions.

On the downside, GDP per capita rose only 0.1%, and household disposable income fell 0.4%. Households are cutting trips and eating out to make ends meet, and fuel purchases fell to levels not seen since COVID lockdowns.

Westpac's consumer-confidence index rose to 89.5 in Q3 from a three-year low of 80.4 the quarter before. Formally, this is an improvement, but any value below 100 remains deeply negative.

For the RBNZ, this signal is ambiguous. Weak consumption helps contain inflationary pressure, but if households are already stretched, further tightening risks turning a slow recovery into a new recession.

GDP stronger than the RBNZ's forecast gives hawks an argument for a third consecutive rate hike in October. However, weak consumer sentiment and falling real incomes point the other way.

The RBNZ's September inflation-expectations survey shows one-year expectations at 2.6% and two-year expectations at 2.34% — moderate readings. If next month's data do not surprise on the upside, the RBNZ will probably prefer to pause in October to assess the effects of two hikes and revisit policy in November or December.

The situation in the Persian Gulf remains the main external risk for New Zealand's economy. Market participants at the APPEC conference in Singapore described near-absurd precautions: tankers transiting with AIS turned off, ship names blacked out, crews sheltered in protected areas on the less vulnerable side. For New Zealand, this means a perpetual risk of new fuel-price spikes. VLCC freight rates from the Gulf to East Asia hit a record $161.93/ton, so the threat of a large-scale energy shock remains high.

Positioning: Kiwi is in a net long position of about +$0.57bn; the implied fair price remains above the long-term average.

Technically, NZD/USD has held above the trendline at 0.5640–0.5650, which remains key support. The bearish impulse looks close to exhaustion, and a renewed attempt to rally is expected. A target area would be roughly 0.5820–0.5840, but there is not yet enough evidence for a confident trend reversal. The most likely scenario is range trading with a slow upward bias.

According to ECB Chief Economist Philip Lane, the eurozone economy is facing a second wave of price increases, affecting not only oil but also gas. According to the European Central Bank, this second wave will result in higher and more persistent inflation than previously expected. As a result, CPI will return to the 2% target only in 2027, according to the Governing Council's updated forecasts.

ECB Economic and Inflation Forecasts

Such rhetoric means that the ECB is prepared to continue its monetary policy tightening cycle. Nevertheless, the futures market expects the deposit rate to rise only to 2.63% by October, implying a 50–52% probability of a rate hike. CME derivatives put the probability of monetary tightening by the Federal Reserve by that time at 53%. The risks are comparable. The same applies to December. In other words, based on this factor, neither the U.S. dollar nor the euro has an advantage.

The difference is that the ECB has not lost market confidence, while the Fed has only just regained it thanks to Kevin Warsh's intention to continue fighting inflation until it is brought under control. This allows U.S. assets to benefit from a recovery in demand. As a result, Treasury yields are falling, the Nasdaq Composite is reaching a record high, and the U.S. dollar is strengthening.

Changes in Germans' Confidence in the Chancellor

The flow of capital from Europe to North America is being supported by rising political risks. After the CDU lost three regional elections in Germany, Friedrich Merz's political standing deteriorated sharply, and his position as chancellor became increasingly uncertain. If the party changes its leader, the outflow of capital from the Old World could accelerate, which would weigh on EUR/USD.

The euro "bears'" unsuccessful attempt to break through the local low is related to traders' reluctance to force the issue. Eurozone and U.S. business activity data will be released a day later. A widening gap between the two economies could reactivate the U.S. exceptionalism factor and lead to a further decline in the main currency pair. It is simply a matter of waiting.

Technically, the daily EUR/USD chart is forming a pin bar with a long lower shadow, signaling weakness among the "bears" and creating an opportunity to place a pending buy order near the pin bar's high at 1.148. At the same time, sellers remain in control of the situation, so it is advisable not to become too aggressive with long positions.

Today, Tuesday, gold (XAU/USD) is facing selling pressure for the second consecutive day, with bears seeking to push the price below the $4,300 level. The hawkish stance of the U.S. Federal Reserve continues to support the dollar and is a key factor behind capital outflows from the "yellow metal."

The updated Federal Reserve forecast (Summary of Economic Projections) showed that officials expect at least one more interest rate hike this year. In addition, Boston Fed President Susan Collins and St. Louis Fed President Alberto Musalem have explicitly spoken in favor of further monetary policy tightening, as inflation risks remain high amid a surge in commodity prices.

At the same time, crude oil prices are showing a moderate recovery after falling to a two-week low, once again raising inflation concerns and pushing up U.S. government bond yields.

This is keeping the dollar near its September high, the highest level since late July, and putting pressure on precious metal prices.

In addition, on Monday, Iran's Islamic Revolutionary Guard Corps (IRGC) warned that it would change the geography of the conflict if the United States further escalates tensions. The United States, in turn, is increasing economic pressure on Iran, stating that Iranian airlines could be barred from international flights from September 23. The escalation of hostilities between the Iran-backed Houthis in Yemen and Saudi Arabia is also maintaining a geopolitical risk premium, contributing to a moderate rise in oil prices and supporting the dollar.

This suggests that a decline remains the most likely scenario for gold, increasing the probability of a further price decline during the day. However, the downward potential is limited, as traders are awaiting new developments regarding the crisis in the Middle East and assessments of their impact on inflation. This could affect interest rate expectations and the dynamics of precious metal prices.

In addition, market participants will be closely watching the important meeting between U.S. President Donald Trump and Chinese President Xi Jinping scheduled for Thursday.

Statements from influential members of the Federal Open Market Committee (FOMC) will also affect the U.S. dollar exchange rate and the price of gold. The fundamental backdrop points to the possibility of a return in the precious metal price to the September low.

From a technical perspective, in the short term, XAU/USD is showing a moderately bearish bias while remaining below the 100-day exponential moving average (EMA), which is currently at $4,360 and is limiting further upside. At the same time, the $4,300 level is providing some support. Momentum indicators remain inconclusive: the Relative Strength Index (RSI, period 14) fluctuated near the neutral level of 48.81, while the MACD indicator is at zero, showing a decline in negative momentum. This indicates that selling pressure is weakening, but does not yet signal a sustained recovery.

Nevertheless, a break below $4,300 would open the way toward the September low.

The EUR/USD pair ended last week with an overall loss of 200 points. The new week began with another decline. I would note that the European currency's period of weakness began the week before last as the market prepared for the FOMC key interest rate hike. During this move, the euro fell almost to imbalance 19, which can currently be considered the last line of support for the euro and the bulls. If this imbalance is invalidated, the European currency will not simply continue declining but could also fall below the psychological level of $1.10. At the same time, bearish imbalance 23 was formed, and its very existence makes the bears' prospects considerably more favorable. Now, if the bulls want to launch an advance of their own, they need to break this pattern. Doing so will not be particularly easy under the current circumstances. Nevertheless, there is still some potential for a recovery. Today, the price precisely reached imbalance 19 and rebounded from this pattern, so it is possible to speak of a buy signal forming. It is difficult to say how long the bulls will be able to maintain their advance, but some upside can now be expected.

Last week, the FOMC indicated its readiness to continue tightening policy, which was enough to trigger another wave of selling by the bears. Even after the Fed's monetary policy tightening in September and possible further tightening in November or December, I do not see what other factors could persuade traders to continue buying the U.S. currency. The dollar has indeed performed strongly over the past few weeks, but what factors supported it during this period? FOMC monetary policy tightening and nothing else?

Overall, in my view, the fundamental backdrop continues to favor the bulls. First, it is clearly visible on any chart that the European currency began its advance from relatively low levels, compared with its average price over the past year. Therefore, there is still upward potential. Second, the market continues to question whether the FOMC will maintain a tightening stance over an extended period. Third, U.S. economic data have recently been mostly disappointing. Fourth, geopolitical developments no longer support the bears or the dollar. Fifth, the ECB has already tightened monetary policy twice in 2026. Sixth, the U.S. Treasury has decided to increase its purchases of long-term bonds, which reduces demand for the dollar. Seventh, a trade war has begun between the United States and Canada. Eighth, the U.S. labor market in 2026 is performing only marginally better than in 2025. Thus, I currently see no reason for a bearish advance.

The current chart setup points to a break in the local bullish momentum. Only imbalance 19 can save the bulls. Since the price has reacted to this pattern, the bulls may attempt to initiate a new trend. I repeat: apart from the FOMC's tightening stance, I see no reason for the dollar to strengthen. A new bearish imbalance 23 has also formed, and the price may react to it in the near future. In this case, the decline would resume below imbalance 19.

The economic backdrop on Tuesday was virtually absent, as the consumer confidence reports for the European Union and the U.S. ADP report are unlikely to be considered significant. The EUR/USD pair had already been moving quite actively before their release, so for now, the chart analysis should take precedence over the economic backdrop.

There remain a large number of reasons for the bulls to attack in 2026. Structurally and globally, Trump's policies, which led to a significant decline in the dollar last year, have not changed. At present, I do not see any significant factors supporting the U.S. currency despite the FOMC's hawkish stance. Geopolitical developments, which supported demand for the U.S. currency for most of the first half of 2026, are no longer doing so.

News Calendar for the United States and the European Union:

• Germany — Manufacturing PMI (07:30 UTC).
• Germany — Services PMI (07:30 UTC).
• European Union — Manufacturing PMI (08:00 UTC).
• European Union — Services PMI (08:00 UTC).
• United States — Manufacturing PMI (13:45 UTC).
• United States — Services PMI (13:45 UTC).

The September 23 economic calendar contains six entries, and I would recommend paying attention to the European PMIs. The economic backdrop may influence market sentiment on Wednesday.

EUR/USD Forecast and Trading Tips:

In my view, the pair remains in the process of forming a bullish trend that has paused for an entire year. The fundamental backdrop shifted sharply in favor of the bears six months ago, but the trend cannot be considered canceled or complete. In the long term, I would say that the pair is trading within a range. However, the range does not invalidate the broader bullish trend. Thus, the bulls may resume their advance in 2026, but their only remaining opportunity is imbalance 19. This imbalance triggered a price reaction on Tuesday, and the next move is now up to the bulls. They urgently need to achieve consolidation above imbalance 23, thereby invalidating it. In this case, traders will have not only a bullish signal but also the invalidation of the only relevant bearish pattern.

The GBP/USD pair has lost its bullish momentum and currently has one final chance to restore it. The price reacted to bearish imbalance 27, which allowed traders to open short positions. This week, the pound declined to imbalance 25, which is a bullish pattern, and reacted to it. At least, this was the situation at the time of writing. Thus, bullish traders have an opportunity to launch a counterattack, and how strong it will be depends entirely on the bulls themselves. Above, the pound now has a strong resistance zone in the form of bearish imbalance 29. It will certainly not be easy to invalidate it quickly. In the most favorable scenario, the price will react to this pattern as well, but the decline will be limited, after which the bulls will regain control. I do not consider a further decline in the British pound to be logical under the current circumstances, as the dollar has no advantages other than the hawkish stance of the FOMC. In my view, a reversal toward 1.3700 and above is a more likely development.

Despite the unfavorable picture for the British pound that has developed in recent weeks, the dollar has also faced numerous setbacks in recent months. If not for the Federal Reserve's decision to raise the interest rate in September and its readiness to tighten policy at least one more time before the end of the year, I would still expect the U.S. currency to decline. I still expect this, but from lower levels. Imbalance 25 plays the same role for the pound as imbalance 19 does for the euro — the role of a last line of support. If both European currencies consolidate below these patterns, nothing will be able to stop the bears. For now, there are still opportunities for the uptrend to resume, supported by the annual ranges and bullish support zones.

Do the bears have further prospects? In my view, there are few, but it should be acknowledged that the dollar has entered a favorable period. The Fed not only decided to raise the interest rate but also signaled to traders its readiness to continue tightening policy. I do not believe that a prolonged decline in GBP/USD can be driven by this factor alone; however, in recent weeks, the market has been almost entirely pricing in the FOMC rate hike. What could prevent it from buying the dollar for several more weeks amid the Fed's monetary policy tightening?

Chart analysis shows that the picture became completely bearish after liquidity was taken from the May highs. The pound also reacted to bearish imbalance 27, which triggered a new decline in prices. The decline was aimed at imbalance 25, and this pattern was reached. A new bearish imbalance 29 was also formed, and the bears may subsequently receive another opportunity to open short positions. However, at present, the price has reacted to a bullish pattern, which means that an upward move should be expected.

There was no economic news on Tuesday. Nevertheless, the pound continues to make attempts to show at least some growth, which provides optimism for the bulls. However, the bulls now need to invalidate imbalance 29 and thereby break the bearish momentum. This will be quite difficult, but not impossible.

The overall fundamental backdrop remains such that, in the long term, I cannot expect anything other than a decline in the U.S. dollar. The war between Iran and the United States has not changed my long-term expectations. Geopolitical developments prompted the market to remember the dollar's safe-haven status for several months, but the conflict has already passed its most active phase. The future of FOMC monetary policy remains uncertain, while the market continues to anticipate only further tightening, which is the main reason for the bears' positive sentiment. In my view, any appreciation of the dollar is temporary and driven by short-term factors. I would also note that GBP/USD has been trading within a range for an entire year. A range allows traders to expect virtually any movement within its boundaries. For now, traders have been unable to break out of the range.

News Calendar for the United States and the United Kingdom:

• United Kingdom — Manufacturing PMI (08:30 UTC).
• United Kingdom — Services PMI (08:30 UTC).
• United States — Manufacturing PMI (13:45 UTC).
• United States — Services PMI (13:45 UTC).

The September 23 economic calendar contains four entries, of which I would highlight the UK PMIs. The economic backdrop may influence market sentiment on Wednesday, but the impact is unlikely to be significant.

GBP/USD Forecast and Trading Tips:

The long-term outlook for the pound remains bullish. In recent weeks, the bears have taken control of the initiative. The liquidity sweep from the May 1 swing allowed the decline to begin; a sell signal formed within bearish imbalance 27, followed by another bearish signal within the same pattern. However, the price reaction to imbalance 25 prompted traders to close their short positions, and bullish traders may now take the initiative. The upward target for the pound is the 1.3404–1.3463 level, where a new sell signal may form. However, in my view, the fundamental backdrop is currently not sufficiently favorable for the dollar for the decline in the pair to continue below imbalance 25.

Today, Tuesday, the US dollar index (DXY), which tracks the greenback against a basket of currencies, is showing a modest pullback after reaching a new high since July 30. However, that advance has not yet found strong follow-through.

Last week, the Federal Reserve raised interest rates for the first time in more than three years, and the dot plot showed officials expect at least one more hike this year. Moreover, Boston Fed President Susan Collins and St. Louis Fed President Alberto Musalem have publicly advocated for further policy tightening as inflation risks remain elevated amid a surge in commodity prices. On top of that, geopolitical uncertainty tends to lift demand for the dollar as a traditional safe-haven asset, which should continue to support DXY in the near term.

Among recent developments, Iran's Islamic Revolutionary Guard Corps (IRGC) warned on Monday that it would change the geography of the war if the US escalates the conflict. At the same time, Washington is ramping up economic pressure on Iran, warning that Iranian airlines could lose access to international air routes from September 23. The dynamic is further complicated by renewed fighting between Iran-backed Houthis in Yemen and Saudi Arabia — all of which underpins a constructive near-term outlook for DXY.

At the same time, Iran offered to reopen the Strait of Hormuz within seven days if the US lifts its blockade of ports and ceases military actions. That optimistic signal pushed crude oil to a two-week low, easing inflation concerns and keeping government bond yields below multi-year peaks.

That, in turn, limits bulls' urge to open fresh long positions in the DXY, so caution remains warranted even against a favorable fundamental backdrop. Before declaring the index at a peak, traders should wait for a convincing continuation of any downward move.

From a short-term perspective, as long as the index holds above the 100-day simple moving average (SMA), it retains a bullish bias.

Key levels: nearest resistance on further upside is at 100.65, followed by a more significant band at 100.80–101.00, with a stronger resistance area near the recent local high around 101.60. On the downside, initial support is at 100.10, followed by the 100-day SMA and other key moving averages. Momentum oscillators remain positive, indicating bulls currently hold the edge.

Brent crude gave back its intraday gains and retreated to about $98/barrel after reports that Iran offered to reopen the Strait of Hormuz in exchange for lifting the US blockade. Positive expectations around possible diplomatic contacts at the UN General Assembly in New York helped reduce inflation fears. Against this backdrop, the 10-year US Treasury yield fell to 4.93%, cooling negative sentiment in the sovereign bond market.

A potential de-escalation in the Gulf removes a large portion of the geopolitical premium from energy prices and reduces inflationary risks for the global economy. Nevertheless, the market remains highly sensitive to any foreign policy headlines. Traders who want to monitor commodity moves and react quickly to trend shifts can use the InstaForex platform. Follow the link for more details.

Wall Street shuns shorts on AI stocks ahead of earnings season

US equity indices held near one-month highs on steady demand for technology names. The AI sector got an extra boost from a positive market reaction to Meta Platforms' new AI agent. With the Q3 earnings season about to begin, most institutional players are avoiding shorts, expecting strong operational results from sector leaders.

Despite lingering macro risks and elevated bond yields, investors continue to trust the fundamentals of the AI theme. Trader attention is gradually shifting to key technical levels on the S&P 500 and the upcoming US–China summit. Follow the link for more details.

Bitcoin surges toward $87,000 as US calls off Red Sea strike

The crypto market saw a sharp rally. Bitcoin pierced $87,000, and Ether held above $2,770 after geopolitical tensions eased. The trigger was US President Donald Trump's last-minute cancellation of a planned strike on Houthi positions in Yemen. The diplomatic turnaround followed emergency consultations with Saudi Arabia's crown prince, after which Houthi representatives publicly pledged to refrain from attacking US vessels in the Red Sea.

The shift in market expectations from military escalation to a local lull triggered a broad short-covering cascade. Buyers are now targeting a break above key resistance near $87,900, which would open the path toward the psychological $90,000 mark. Follow the link for more details.

DXY holds near local highs amid Fed hawkish signals and geopolitical rhetoric

The US dollar index (DXY) remains in bullish territory, trading close to late-July highs despite a short pause. The primary support for the dollar comes from hawkish comments by Federal Reserve officials calling for further interest rate hikes amid persistent inflation risks. Ongoing geopolitical uncertainty in the Middle East and increased US sanctions pressure on Iran also support demand for the dollar as a safe-haven asset.

At the same time, the scope for further DXY gains is being checked by corrections in commodity markets. Tehran's statement that it may reopen the Strait of Hormuz in exchange for lifting the trade blockade pulled oil down to two-week lows, easing inflation worries and preventing US yields from retesting recent peaks. Follow the link for more details.

The causal chain centers on how close the market had come to a fresh wave of military escalation just a day earlier. According to The New York Times and Axios, the US administration had been preparing a strike — bombs were loaded onto aircraft — and Trump decided to cancel at the last minute after calls from Saudi Crown Prince Mohammed bin Salman, who had been pressing for US military action against the Houthis advancing toward the strategically vital Bab al-Mandeb strait. Apparently, the US president did not want to open a second front of tension in the strait while the Strait of Hormuz was already effectively blocked, since that risked another jump in oil prices at a moment when Saudi Arabia itself was expected to bear the brunt of containing the Houthis.

That crossroads — between full US military engagement and diplomatic settlement via intermediaries — determined the market's direction. The decision not to strike signaled that the base case had shifted toward de?escalation rather than an expanded conflict, triggering a rapid short squeeze: shorts opened on the expectation of the opposite outcome were violently closed. The main beneficiaries were holders of long positions in Bitcoin and Ether, while short sellers betting on continued geopolitical tension bore the brunt of cascade liquidations.

I believe the durability of this move will depend directly on whether the Houthis honor their promise not to attack US vessels, since the group simultaneously says it will continue strikes on Saudi targets until blockades of its controlled territories are lifted — meaning a full settlement has not been reached, only one of the most dangerous scenarios has been averted. Traders' attention will also focus on President Trump's speech at the UN General Assembly in New York later on Tuesday: the market is watching whether he meets his Iranian counterpart Masoud Pezeshkian, a meeting that could be a turning point for oil prices.

Technical analysis

Bitcoin

Buyers are now aiming to reclaim $87,900, which would open a straight path to $90,000 and then to $92,100 — a breach of which would signal attempts to restore a bull market. On the downside, buyers may step in at $85,300; a drop below that level could quickly push BTC toward $83,600. The next extended target on the downside is $81,600.

Technical analysis

Ethereum: A clear hold above $2,770 opens the way to $2,872, with a further target at around $2,920 — a break above which would reinforce bullish market sentiment and revive buyer interest. On the downside, support is expected at $2,660; a return below that level could quickly send ETH toward $2,570, with a further downside target near $2,486.

What's on the chart

• The red lines represent support and resistance levels, where the price is expected to either pause or react sharply.
• The green line shows the 50-day moving average.
• The blue line is the 100-day moving average.
• The lime line is the 200-day moving average.

Price testing or crossing any of these moving averages often either halts movement or injects fresh momentum into the market.

Bitcoin is trading around $86,000 after intraday highs above $87,300 the previous day, recovering almost the entire mid?September drop when the price fell to $75,000–76,000 amid the Clarity Act vote failure in the US Senate. Bitcoin dominance remains about 59%, showing that capital is still concentrated primarily in the leading crypto despite the signal flip — it has not flowed into altcoins in volumes large enough to materially reduce BTC's share of the market cap. Ethereum is trading near $2,730, and among other large altcoins, XRP stands out with a roughly 6% gain and Solana with about a 4.5% rise.

The causal link is important for correctly interpreting the signal: Glassnode's indicator measures the relative performance of the top?250 altcoins versus Bitcoin, and its switch to altseason does not always indicate a genuine inflow of new capital into altcoins — historically, such shifts often occurred simply because Bitcoin fell sharply, not because altcoins were strong. Now the situation looks different: Bitcoin is not falling and is making local highs itself, and it is the simultaneous rise across a broad range of assets — not relative BTC weakness — that caused the signal flip, making this instance a more convincing confirmation of capital rotation than previous indicator triggers this year.

I believe confirmation of a true altseason will be the signal's persistence amid a possible stabilization or pause in Bitcoin's ascent expected soon — that scenario, rather than a continued sync rally of all assets at once, is traditionally considered the classic sign of healthy capital rotation within the market.

Bitcoin technicals The price is holding in the $84,900–87,200 range, and the trading plan is built around two mirrored directions with full breakout and rejection scenarios. A breakout above $86,300 triggers a buy targeting $87,200, where profits should be taken and a reversal into short considered on a potential pullback. Mandatory entry conditions: price must remain above the 50?day moving average, and the Awesome Oscillator must be in positive territory. The second buy setup is a bounce play if price approaches the lower band at $85,700, but a downside breakout is not confirmed — this should be treated as a false move and a long opened with targets first at $86,300 and then $87,200 as a wider technical target should the rally extend beyond the near range.

Shorts are structured symmetrically. A confirmed break below $85,700 leads to a short targeting $84,900, with mirror conditions: the moving average above price and the Awesome below zero. The second short works from a rejection at $86,300 if an upward breakout fails to confirm, opening a path to $85,700 and then $84,900.

Ethereum technicals Ethereum is trading in the $2,696–2,781 range, and the logic mirrors Bitcoin's on its own price scale. A breakout above $2,748 signals a buy targeting $2,781 under the same conditions: the rising moving average beneath price and Awesome above zero. The second buy variant is a bounce at $2,730 if a downside breakout is not confirmed, aiming first for $2,748 and then $2,781 as a wider target for continuation.

Sell setups for Ethereum begin with a break below $2,730 targeting $2,696, if the moving average is above price and Awesome is negative. The second sell works from a rejection at $2,748 if an upward breakout fails to confirm, with targets back to $2,730 and then $2,696. Both indicators serve purely as filters to weed out false moves, not as independent reasons to enter early — decisions are taken only after price confirms the specified levels.

That implies a direct chain for the wider market: the more tangible a diplomatic settlement around Hormuz looks, the faster inflation expectations fall — and with them Treasury yields. Ten-year yields eased two basis points to 4.93%, while the dollar hardly budged.

Traders are now focused on US President Donald Trump's remarks to the UN General Assembly in New York later Tuesday: the market will watch closely for any meeting between him and Iranian President Masoud Pezeshkian, which could be a turning point for oil prices. Progress in those talks would benefit energy consumers and the bond market by removing part of the inflation premium, while holders of long oil positions, who twice this week overstated the geopolitical premium, would lose.

AI-related stocks showed mixed performance after Meta Platforms' new AI agent sparked a sector-wide rally in the prior session. It's clear that ahead of the Q3 earnings season, few are willing to short tech or the AI trade. The market appears to be betting on Trump's ability to bring oil prices down before the midterms.

That confidence in the AI theme, however, remains vulnerable to macro risks: yields, though lower this week, still sit near multi-year highs as the market prices in imminent rate increases against a persistent fiscal deficit. Investors are also positioning for a summit between Trump and China's Xi Jinping later this week. Delegations from both sides wrapped a second day of talks in New York on Monday, trying to make progress ahead of Xi's visit. In my view, this mix — an AI rally that the market is reluctant to sell, oil's sensitivity to Iran negotiations, and uncertainty around a trade truce with China — makes markets especially reactive to any geopolitical headlines in the coming days. I wouldn't be surprised if Trump's UN speech, not macro releases, becomes the main driver for bond yields and oil through the end of the week.

Technically, the S&P 500 chart indicates that the immediate task for buyers is to overcome the resistance level of $7,774 to signal further upside and open the path to $7,793. Maintaining control above $7,810 would further strengthen the bulls' case. On the downside, buyers must defend $7,756. A break below that level would likely push the index back to $7,737 and open the way to $7,718.

Chicago Fed President Austan Goolsbee said on Monday at an event in London that the central bank cannot afford to ignore recurring and persistent supply shocks. According to Goolsbee, supply shocks are happening more frequently, hitting the economy harder and lasting longer, and once such shocks to inflation become persistent, the logic behind "looking through" them breaks down. That was the core of his message: whereas central banks historically treated one-off price spikes as temporary, Goolsbee argues these shocks — from pandemic supply chain disruptions to oil prices sitting near $100/bbl for much of the year and escalating tariffs — have become a "regular feature" of the economy rather than an exception.

Goolsbee acknowledged that the response to supply shocks need not be as aggressive as the response to demand overheating, but it will not be painless either. This is the painful trade?off between employment and inflation that stagflationary shocks always force on a central bank, he said, adding that in such circumstances, the path back will be difficult. Speaking to reporters after his remarks, he went further: if price pressure is driven by both supply shocks and demand overheating, then the Fed's median projection for one more hike may not be sufficient to restore price stability.

While Goolsbee discussed principles, St. Louis Fed President Alberto Musalem spoke more bluntly in a Reuters interview on the same Monday. He said that persistent demand and repeated supply-side factors continue to keep inflationary risks elevated, and without further tightening, the probability that inflation will be materially above the 2% target in 18 months is greater than it being on target. Musalem, who does not have a vote on the rate committee this year, added that the current policy range of 3.75–4.00% still looks, in his view, on the easy side and therefore does not sufficiently restrain the economy to slow growth and cool inflation. Moreover, he argued that acting earlier with gradual rate increases will cause less economic disruption than taking sharper steps later, effectively making the case for preemptive action now rather than waiting.

Both speeches landed squarely against the backdrop of the Fed's unanimous decision last week to raise the policy rate for the first time in three years and the promise of another hike before year-end. Fed Chair Kevin Warsh described the move as removing a "dose of accommodation" to help bring inflation back to target, but that measured, technical language now contrasts sharply with the much more alarmed tone of his colleagues. The implication is direct: if both regional presidents are right that supply shocks have become persistent and the current policy range remains too easy, committee pressure will build toward an earlier or sharper next move rather than toward a pause.

The contrast is amplified by the political backdrop. After the Fed's decision last week, Trump economic adviser Peter Navarro wrote that one should not hike into an energy price shock, calling Warsh's action possibly the worst first-rate decision among new Fed chairs in modern history. Such harsh criticism from the White House benefits the president, who gains a convenient argument against the regulator's independence, while Warsh loses, forced to balance administration pressure against the increasingly hawkish stance of colleagues like Goolsbee and Musalem.

In my view, the sum of these two speeches points to one conclusion: a camp is consolidating within the Fed that believes markets and politicians underestimate the persistence of inflation, so the next policy move is more likely to be another hike than a pause or, even less likely, a cut, contrary to White House wishes. I don't rule out that Goolsbee and Musalem's rhetoric is laying the groundwork for a firmer signal at the October meeting, which takes place just days before the midterms. In that scenario, the dollar would receive additional support, while gold and long-dated bonds remain under structural pressure longer than the market assumed a week ago.

EUR/USD technical outlook

Buyers now need to consider how to capture 1.1480. Only that would allow a test of 1.1505. From there, a move to 1.1530 is possible, though doing so without support from major players would be difficult. On the downside, I'd expect significant buyer activity only around 1.1455. If bids are absent there, it would be prudent to wait for a new low at 1.1430 or to open long positions at 1.1410.

GBP/USD technical outlook

Pound buyers need to overcome the immediate resistance level of 1.3370 to target 1.3400, above which further progress will be challenging. The next extended target is 1.3435. On the downside, bears will try to seize control at 1.3335. A break below that level would hit bulls hard and could push GBP/USD toward 1.3300 with a view down to 1.3275.

The timing added weight to the news: US President Donald Trump is expected to speak at the UN General Assembly in New York later on Tuesday and could meet his Iranian counterpart Masoud Pezeshkian on the sidelines. The coincidence of Iran's diplomatic initiative with a possible leaders' meeting was the main trigger for the oil selloff, since the market often reacts less to the fact of talks than to the likelihood they will succeed.

Optimism should be treated cautiously. Attempts to end the war that has rattled energy markets for more than six months have been made repeatedly — including a short summer truce — and have so far produced no lasting result. Since then the US has blocked Iranian ports, cutting vital export revenues, and Iran has responded by attacking ships in the Strait of Hormuz. Although flows through the strait remain measured in millions of barrels per day, they are still below pre?war levels.

Since the start of the year, oil has rallied more than 60% as the Middle East conflict disrupted shipments through the world's most important energy chokepoint, and fuel prices have risen even more sharply. However, even a partial de?escalation around Hormuz would not remove all pressure from the market, because the fuel deficit is not caused solely by Iran but also by the separate Russia?Ukraine front.

Another factor remains the fate of Saudi Arabia's East?West pipeline, idled after a shutdown earlier this month: the kingdom has already told Asian refiners it will soon be able to resume shipments via the Red Sea port of Yanbu. For now, Saudi Arabia appears to have re?directed exports back through the Persian Gulf via Hormuz.

In my view, as long as Iran's offer remains an unconfirmed third?party report rather than an official Tehran statement, the market will trade the news cautiously. I would not rule out a quick rebound of Brent to $100–102 if a Trump?Pezeshkian meeting at the UN yields no concrete agreements. A far more durable factor for prices in the coming days would be the actual reopening of the Saudi East?West pipeline, which could add significant supply regardless of the Hormuz talks' outcome.

On the technical side, buyers need to take the nearest resistance at $96. That would allow a run toward $100, above which further advances would become considerably more difficult. The next extended target is around $104. On the downside, bears will try to seize control of $92; if they succeed, a breakdown of that range would seriously damage bull positions and push oil toward a low of $89 with a prospect of reaching $87.

It is gold's sensitivity to oil swings that is driving its moves now: traders are trying to gauge whether high energy prices will keep inflationary pressure high enough to justify more Fed hikes. The cheaper oil becomes, the fewer arguments the Federal Reserve will have to continue tightening. This would benefit gold — an asset with no yield — while the dollar and short?term interest rates would lose some recent support.

The diplomatic backdrop adds uncertainty on several fronts. President Donald Trump will speak at the UN General Assembly in New York and has indicated he is prepared to meet his Iranian counterpart Masoud Pezeshkian on the sidelines, fueling the prospect of de?escalation and pushing oil down. If such a meeting takes place and produces real progress, oil could fall further, dragging down inflation expectations and providing additional support for gold regardless of Fed decisions.

At the same time, the market is parsing comments from Fed officials after last week's unanimous rate hike — the first in three years. Chicago Fed president Ostan Gulsby said on Monday the central bank cannot ignore recurring and persistent supply shocks and must respond in ways that may hurt the economy. St. Louis Fed President Alberto Musalem went further, saying additional hikes may be needed to reach the inflation target that has been missed for more than five years. The implication is clear: the firmer the rhetoric from regional Fed presidents, the higher the risk to gold through rising real yields — yet the stronger gold's role as a hedge against the threat of prolonged, economy?hurting policy.

Several other Fed officials are scheduled to speak today and should be watched closely.

Structural support for the metal is coming from physical demand: China's gold imports, as the world's largest consumer, have been record?high this year amid falling global prices and a stronger yuan. Customs data, compiled since 2017, show purchases through August exceeded 1,000 tonnes, surpassing the total for all of 2025. Such demand benefits Chinese importers and the global gold market overall, as steady physical buying from Asia offsets potential outflows from ETFs in the face of high Fed rates.

In my view, the key trigger for gold in the coming days will be not so much Fed rhetoric — already largely priced in — but the outcome of a possible Trump?Pezeshkian meeting on the UN sidelines. Real progress on reopening the Strait of Hormuz could continue to drive oil lower and ease inflationary pressure, opening the way for gold back above $4,350. A breakdown in talks and renewed escalation would quickly reverse both oil and gold.

On the technical side, buyers need to take the nearest resistance at $4,372 to aim for $4,424, above which further advances would be difficult. The next extended target is around $4,481. On the downside, bears will try to seize control of $4,304; if they succeed, a breakdown would seriously damage bull positions and push gold toward a low of $4,249 with the prospect of reaching $4,186.

The test of 157.38 occurred when the MACD indicator had just started moving down from the zero line, confirming that it was an appropriate entry point for selling the U.S. dollar. As a result, the pair fell sharply toward the target level of 156.92.

Next, we will have the Richmond Fed Manufacturing Index, which will be released in the second half of the day, but it will most likely be overshadowed by a much more significant event: a series of speeches by FOMC members John Williams, Tom Barkin, and Philip Jefferson. Following the unanimous rate hike and the significant upward revision of forecasts, the market will analyze every word from these speakers in search of confirmation of the regulator's continued commitment to further action. If their rhetoric is consistent with Waller's stance, the dollar may strengthen its gains from the previous day without significant resistance. For the yen, further dollar strength in this context only increases the already significant contrast with the much more gradual and cautious stance of the Bank of Japan.

I would remind you that last week, on September 18, the Bank of Japan raised its interest rate by 25 basis points to 1.25%, its highest level since 1995. This was the third rate increase in the current policy normalization cycle, which began in March 2024. However, the vote was split 7–2, with board members Toichiro Asada and Ayano Sato voting against the increase. It is also worth noting that the interval between this increase and the previous one in June was reduced to three months from six previously, meaning that the central bank is accelerating the pace of tightening. However, for the yen to strengthen, new interventions by the regulator may apparently be necessary.

As for the intraday strategy, I will focus more on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy USD/JPY today when the entry point around 157.15 is reached (the green line on the chart), with a target of 157.51 (the thicker green line on the chart). Around 157.51, I will close the long position and open a short position, targeting a move of 30–35 points in the opposite direction from the level. An upward move in the pair can be expected today, but the upward potential appears limited. Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today if the price tests 156.82 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal to the upside. A rise toward the opposite levels of 157.15 and 157.51 can be expected.

Sell Signal

Scenario No. 1: I plan to sell USD/JPY today after the price breaks below 156.82 (the red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 156.46, where I will close the short position and immediately open a long position, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair may return today if the central bank intervenes. Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today if the price tests 157.15 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal to the downside. A decline toward the opposite levels of 156.82 and 156.46 can be expected.

What Is Shown on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold areas into account.

Important. Beginner Forex traders need to be very cautious when making decisions about entering the market. Before the release of important fundamental reports, it is best to remain out of the market to avoid being caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

The test of 1.3370 occurred when the MACD indicator had just started moving down from the zero line, confirming that it was an appropriate entry point for a short position on the pound. As a result, the pair declined toward the target level of 1.3350.

The pound fell and updated last week's low, but sellers failed to extend the move. The speed of the buyers' reaction near the lows indicates that the market is not yet ready to break below the lower boundary of the range without an additional catalyst. In my view, this behavior of the pair should be considered a sign of a relative balance of forces: sellers are able to push the pound toward local lows but do not have enough arguments to consolidate their gains, while buyers, in turn, are actively defending the established channel levels. In the second half of the day, the market will focus on a series of speeches by FOMC members John Williams, Tom Barkin, and Philip Jefferson, while the release of the Richmond Fed Manufacturing Index will most likely receive less attention. Following the Fed's decisive move and the notable tightening of its forecasts, the rhetoric of these three speakers will show how sustainable the committee's new hawkish stance is. If their comments confirm a readiness for further action, the dollar may strengthen its gains from yesterday with relatively little resistance. Such a scenario would be particularly unfavorable for the pound against the backdrop of the Bank of England's decision to leave its interest rate unchanged despite inflation accelerating to 3.1%.

As for the intraday strategy, I will focus more on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound today when the entry point around 1.3370 is reached (the green line on the chart), with a target of 1.3384 (the thicker green line on the chart). Around 1.3384, I will close the long position and open a short position, targeting a move of 30–35 points in the opposite direction from the level. A rise in the pound today can be expected only if the Fed adopts a less hawkish stance. Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2: I also plan to buy the pound today if the price tests 1.3355 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal to the upside. A rise toward the opposite levels of 1.3370 and 1.3384 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the pound today after the price breaks below 1.3355 (the red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 1.3336, where I will close the short position and immediately open a long position, targeting a move of 20–25 points in the opposite direction from the level. Strong downward pressure on the pound may return at any time. Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario No. 2: I also plan to sell the pound today if the price tests 1.3370 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal to the downside. A decline toward the opposite levels of 1.3355 and 1.3336 can be expected.

What Is Shown on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold areas into account.

Important. Beginner Forex traders need to be very cautious when making decisions about entering the market. Before the release of important fundamental reports, it is best to remain out of the market to avoid being caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

The test of 1.1460 occurred when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. For this reason, I did not sell the euro.

The euro came under pressure amid political news from Germany, where Chancellor Friedrich Merz announced his intention to remain in office despite his party suffering its largest-ever defeat in state elections. The result dealt a significant blow to Merz's position just 16 months after he took office, and voices are already emerging among rank-and-file party members calling for his resignation. For the single currency, such political instability in the eurozone's largest economy represents an additional risk factor at a time when the euro already appears vulnerable.

The key events in the second half of the day will not be the Richmond Fed Manufacturing Index data, but rather speeches by three FOMC members — John Williams, Tom Barkin, and Philip Jefferson. The market has clearly shifted its focus from routine economic data to official rhetoric, which is understandable: following a unanimous 25-basis-point rate hike and a notable upward revision to forecasts, it is much more important to understand how sustainable this hawkish stance is within the committee itself. If today's speakers confirm their readiness to continue in the same direction, the dollar, in my view, will have an additional reason to strengthen its already substantial gains from yesterday. Given that John Williams has maintained a relatively cautious tone regarding the inflation trend in recent weeks, his comments today are particularly interesting: any shift away from his previous caution toward more hawkish language could push EUR/USD noticeably lower.

As for the intraday strategy, I will focus more on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, the euro can be bought when the price reaches the area around 1.1478 (the green line on the chart), with a target of 1.1502. At 1.1502, I plan to exit the market and also sell the euro in the opposite direction, targeting a move of 30–35 points from the entry point. Any rise in the euro today can be expected only as part of a correction. Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2: I also plan to buy the euro today if the price tests 1.1452 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal to the upside. A rise toward the opposite levels of 1.1478 and 1.1502 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after the price reaches 1.1452 (the red line on the chart). The target will be 1.1425, where I plan to exit the market and immediately buy in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair may return at any time. Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario No. 2: I also plan to sell the euro today if the price tests 1.1478 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal to the downside. A decline toward the opposite levels of 1.1452 and 1.1425 can be expected.

What Is Shown on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the expected price at which Take Profit orders can be placed or profits can be closed manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold areas into account.

Important. Beginner Forex traders need to be very cautious when making decisions about entering the market. Before the release of important fundamental reports, it is best to remain out of the market to avoid being caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

The wave structure on the hourly chart has changed to a bearish one. The latest completed upward wave failed to break the previous peak, while the latest downward wave broke the previous low. The geopolitical situation remains consistently negative and has a strong chance of becoming more tense in the near future. The market expects several stages of FOMC monetary policy tightening by the end of the year. These two factors have brought bearish traders back into the market.

There was no significant news flow on Monday, and during the day traders found no compelling reason to accelerate market movements. The market is currently in another pause before a potential increase in volatility, while bearish traders continue to exert gradual downward pressure. There was also no significant economic background during the first half of today's session, so the U.S. dollar is rising without support from economic data. Therefore, I conclude that we are still seeing some effects of last week's FOMC meeting. Last week, the Fed decided to raise its interest rate for the first time in three years, which had a strong impact on the market. Traders now see nothing but further monetary policy tightening by the Fed, or perhaps simply do not want to see anything else. The ECB's monetary policy tightening does not appear to satisfy them for some reason, so they are not paying attention to it.

On the 4-hour chart, the pair declined to the 23.6% Fibonacci level at 1.1449. A rebound from 1.1449 would allow for a reversal in favor of the euro and some upward movement toward 1.1526. Consolidation below 1.1449 would increase the likelihood of a further decline toward the next retracement level of 0.0% at 1.1325. No emerging divergences are currently observed in any indicator.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders closed 4,968 Long positions and opened 12,723 Short positions. During the seven weeks in February and March, the overwhelming advantage of buyers disappeared because of the war in Iran, while over the past twenty-four weeks the situation has become more balanced amid market expectations that the conflict will end. The total number of Long positions currently held by speculators is 198,000, while the number of Short positions is 241,000. Sellers remain in the lead, although their advantage is narrowing.

Overall, over the long term, large market participants continue to show considerable interest in the euro. Clearly, various events around the world, of which there has been no shortage in recent years, affect investor sentiment. In particular, the market is currently keeping a close watch on the situation in the Middle East, where the war alternately appears to end and then resume. However, geopolitical developments no longer determine the dollar's direction on their own.

U.S. and European Union Economic Calendar:

• U.S. – ADP employment report (weekly) (12:15–12:00 UTC).
• European Union – Consumer Confidence Index (14:00 UTC).

The economic calendar for September 22 contains two entries, neither of which I consider particularly interesting or important. The economic background is therefore unlikely to have any influence on market sentiment on Tuesday.

EUR/USD Forecast and Trading Tips:

Long positions in the pair are possible today if the price consolidates above 1.1473 on the hourly chart, with targets at 1.1519 and 1.1564. Short positions were possible following consolidation below 1.1473, with a target of 1.1416. These trades can remain open today.

The Fibonacci levels are drawn from 1.1325 to 1.1712 on the hourly chart and from 1.1849 to 1.1325 on the 4-hour chart.

Donald Trump's approval ratings continue to plunge. According to a new Reuters poll, only 32% of Americans approve of the president's performance. Among Republicans, support has fallen to 73%. Remarkably, 32% approval is a new personal low for Trump. As I have said many times, the main complaint Americans have about Trump's policies is the rising cost of living. I have said repeatedly that many Americans don't even know where Iran is on the political map — they simply don't care. What matters to them is how much fuel costs at the pump and how quickly prices for essentials are rising. And on that front, things are bad. Diesel in the US set a new record yesterday, reaching $6.50 per gallon. So I'm not surprised that a majority of Americans oppose the incumbent president, who, unsurprisingly, claims to be "the greatest in US history."

The Reuters poll also shows that, for the first time, the number of Republicans unhappy with Trump's handling of the cost?of?living issue now exceeds those who are satisfied. Only 34% of respondents support a war with Iran, and 82% believe the conflict will last a very long time. The poll also found that 43% would vote for Democrats in upcoming elections, while only 35% would vote Republican — the largest gap seen in 2026 so far.

Meanwhile, Trump has launched a new battle — this time a media war. Yesterday the president revoked White House press credentials for CNN, MSNBC (MS NOW), and Politico. In short, those outlets were expelled from the White House. Donald Trump justified the decision by accusing them of "spreading fake news." All three companies have filed lawsuits, and five other major networks announced a boycott of Trump and voluntarily gave up any White House broadcasts. It seems likely Trump may soon need not only his own social network, where he can post whatever he likes, but also his own TV channel to broadcast as he pleases. In my view, this is another unprecedented Trump episode. I still wonder what made Americans elect a Republican president for a second time.

November 3, when the midterm elections to Congress kick off, promises to be very interesting. Personally, I believe Republicans, thanks to Trump, will at least lose the House of Representatives. But the president still has another month and a half to persuade Americans not to vote for Republican senators either.

Wave analysis for EUR/USD

Based on my analysis of EUR/USD, I conclude the currency pair remains within a broad corrective segment labeled A?B?C?D?E. If this assumption is correct, the decline will continue toward levels below the low of wave C — 1.1325. I regarded this scenario as an alternative; if not for the Fed meeting, it would have remained a backup view. But the Fed surprised the market, leaving it no option but a new wave of dollar buying. At the same time, further dollar strength requires new catalysts, which I do not yet see. Therefore, from current levels, a new impulsive upward, non?corrective wave could begin.

Wave analysis for GBP/USD

The wave structure for GBP/USD has taken on a fairly clear shape, though it could become more complex. On the charts, we see a clear corrective A?B?C structure, which after the Fed meeting could transform into A?B?C?D?E. If that assumption is correct, the pound sterling will continue to decline with targets below the 1.31 area that marks the low of wave C. The news flow now needs to support the dollar for the proposed wave E to form.

The main principles of my analysis:

1. Wave structures should be simple and clear. Complicated structures are hard to trade and often change.
2. If you are not confident about what is happening in the market, it's better not to enter it.
3. There is no and can never be 100% certainty about the direction of movement. Don't forget protective Stop?Loss orders.
4. Wave analysis can be complemented by other types of analysis and trading strategies.

The main source of pressure on the euro today was not economic data but politics. German Chancellor Friedrich Merz stated that he did not intend to leave office despite the disastrous result of the state elections for his party—the worst result in its history. In Mecklenburg-Western Pomerania, the CDU received only 4.9% of the vote, coming close to failing to clear the 5% threshold for entry into the state parliament, while the far-right Alternative for Germany (AfD) won a decisive victory with 38.2% support. For the currency, such results are significant not in themselves but as a signal of political instability in the region's largest economy: Merz has been chancellor for only 16 months, yet calls for his resignation are already being voiced within his own party. For the euro, this is an additional source of pressure on top of its already weakened position, and the market will likely closely monitor how the internal party conflict develops over the coming days.

The pound is facing a different situation today. The pair managed to renew last week's low, but the sell-off quickly lost momentum, bringing GBP/USD back into the sideways channel. This rapid reaction indicates that the channel boundaries are still viewed by the market as significant reference points, and market participants appear more inclined to buy local declines than to increase pressure on the pound.

Among the U.S. data releases in the second half of the day will be the Richmond Fed Manufacturing Index, but much more important will be speeches by three Fed officials—John Williams, Thomas Barkin, and Philip Jefferson. Following the recent unanimous rate hike and the noticeably more hawkish outlook for the rate path, traders will look in their comments for confirmation or, conversely, moderation of the course that has just been established. This rhetoric, rather than the secondary regional index, will determine the dollar's movement through the end of the session. If even one of the speakers supports further monetary policy tightening, the dollar could easily consolidate yesterday's advantage against a broad range of currencies. For EUR/USD, this means the risk of a further widening divergence with the ECB: although the European central bank also raised rates, it has already characterized the move as part of the process of moving closer to its target, whereas the Fed has just indicated the opposite—that further steps remain quite possible. If U.S. officials today echo Warsh's hawkish tone, this difference in their willingness to continue tightening will become an even more significant source of pressure on the euro. The situation for GBP/USD is no less vulnerable: the pound has already been weakened by the Bank of England's decision to leave rates unchanged, and without strong domestic drivers, the pair risks moving solely in response to what Williams, Barkin, and Jefferson say today.

Momentum

For the euro, the key upward level is 1.1478. A breakout above it could take the pair toward 1.1499 and then 1.1523. This scenario is realistic only if today's Fed speakers deliver clearly dovish signals; without them, a sustained rise will be difficult given the current political environment in Germany. I consider a downside break of 1.1457 to be the more relevant scenario, with targets at 1.1436 and 1.1412, as both Merz's domestic political problems and expectations of hawkish rhetoric from U.S. officials are exerting pressure in the same direction.

For the pound, the upside level is 1.3368, above which the pair could reach 1.3397 and then 1.3420. Given that buyers have already demonstrated their willingness to buy declines today, this scenario remains viable if Fed officials' comments are not excessively hawkish. A downside break of 1.3334, with targets at 1.3304 and 1.3275, remains relevant, but judging by today's rapid recovery, a more significant catalyst than the general dollar backdrop will be required for this scenario to materialize.

Mean Reversion

For the euro, I am monitoring the upper boundary at 1.1478. The logic is simple: the pair attempts to hold above this level, but there are not enough buyers to sustain the move, and the price falls back below it—a sell signal. Given the current political pressure on the euro, this scenario appears reasonable. The lower reference level at 1.1443 works according to the opposite logic, but buying here should be approached with caution: uncertainty surrounding Merz's political future continues to weigh on the euro, making a sustained rebound difficult to expect, and it would be reasonable to keep the target for such a trade modest.

For the pound, the upper boundary is 1.3380. The same return-to-range pattern applies here, and given that the pair has just confirmed the significance of its channel boundaries by quickly recovering from the decline, a false break above the upper boundary followed by a return inside the range appears to be a logical scenario. The lower reference level at 1.3340 suggests buying on a rebound following a false break below the level. Today's price action has already shown that this type of reaction is currently more consistent with market behavior, although the Fed officials' speeches later today could still change the situation.

The market situation remains bearish. The last completed upward wave failed to break the previous high, while the new downward wave, which is still forming, broke the previous low. Thus, the bears now have the initiative. The FOMC's monetary policy tightening and the hawkish outlook conveyed by Kevin Warsh sharply improved bearish sentiment. A break of the current trend is now possible only above 1.3567.

There has been no significant news flow in the United Kingdom or the United States on Monday and Tuesday, apart from reports that the market itself never takes into account. For example, I do not believe that the weekly ADP report can evoke any significant reaction among traders when the monthly ADP report never does so. Thus, only tomorrow will information worthy of attention reach the market. On Wednesday, business activity indices for September will be published in the European Union, the United Kingdom, and the United States. In the absence of more important releases, these are the key events of the week. Today, the bears made a third attempt to continue their advance, but the bulls are desperately defending the 1.3339 level. I would like to believe that the pound has finally found a bottom and that a bullish trend will begin from this level. In my view, the market has already sufficiently priced in the FOMC's monetary policy tightening.

On the 4-hour chart, GBP/USD made another decline to the 61.8% Fibonacci retracement level at 1.3348. A rebound from 1.3348 would allow for some upward movement in the pound toward the 50.0% Fibonacci level at 1.3409. Consolidation below 1.3348 would favor a resumption of the decline toward the 76.4% retracement level at 1.3277. No new emerging divergences are observed on any of the indicators.

Commitments of Traders (COT) Report:

The sentiment of the "Non-commercial" trader category became more bearish over the latest reporting week. The number of Long positions held by speculators decreased by 11,866, while the number of Short positions decreased by 2,605. The current gap between the number of Long and Short positions is effectively 74,000 versus 132,000. The gap and the bears' advantage are gradually narrowing, but the bears still maintain a substantial advantage. Previously, the bears' dominance was unquestionable, but this is now less certain because the news background has changed.

I still do not believe in a bearish trend for the pound, but in the near term, everything will depend on Trump's trade policy, the monetary policies of the Fed and the Bank of England, as well as the duration, scale, and consequences of the war in the Middle East. In recent months, the market had adjusted its expectations toward peace, but negotiations between Iran and the United States failed before they had properly begun. There is no guarantee that they will resume in the near future. The Fed's monetary policy stance remains contradictory.

News calendar for the United States and the United Kingdom:

• United States – ADP employment report (weekly) (12:00–15:00 UTC).

The September 22 economic calendar contains no noteworthy events. The economic news background will have no influence on market sentiment on Tuesday.

GBP/USD Forecast and Trading Advice:

Selling the pair is possible today if the hourly chart consolidates below 1.3339, with a target of 1.3272. Buying is possible on a rebound from 1.3339, with targets at 1.3381 and 1.3414. The first target has already been reached.

The Fibonacci levels are drawn from 1.3557 to 1.3272 on the hourly chart and from 1.3158 to 1.3655 on the 4-hour chart.

Retail sales increased by 0.5% m/m in August, fully reversing July's 0.5% decline, while the market had expected another decrease. On an annual basis, growth reached 2.4%, compared with the forecast of 1.6%.

The unemployment rate for the three months through July remained at 4.9%, while the number of employees on payrolls fell by 26,000 from July to August and by 145,000 year on year. Regular pay excluding bonuses remained stable at 3.5%; in the private sector, it was only 2.9%, while in the public sector it was 6.3%.

The Bank of England meeting on September 17 ended as expected, with the policy rate remaining at 3.75%. This was the fifth consecutive decision to leave rates unchanged since December last year. In its accompanying statement, the Committee explicitly stated for the first time that inflation risks had shifted to the upside, with the shift being more pronounced than in the July report.

BoE Governor Bailey acknowledged that the transmission of energy prices into the economy had been "fairly moderate," but immediately added that the longer this continues, the more difficult the task becomes. In his view, the only way to resolve the situation is for the conflict in the Middle East to end and energy prices to actually return to pre-conflict levels. Brent crude surpassed $100 per barrel last week for the first time since July. In the ten days leading up to September 6, an average of only 10 commercial vessels per day passed through the Strait of Hormuz, the lowest figure since May, while no very large crude carrier had left the Gulf since September 2.

The United Kingdom is highly dependent on gas, but its domestic storage capacity is limited. Therefore, during periods of peak demand or low renewable energy generation, the country has to rely on seaborne LNG supplies—and this is currently the most vulnerable segment. At the beginning of September, OPEC+ suspended its production increase for the first time since April, depriving the market of additional supply. As a result, prices are currently determined not by the balance of supply and demand, but by the availability of transportation, meaning that production decisions have almost lost their significance.

Investors are pricing in at least one rate hike by the end of the year, with a probability of around 75%, and approximately a 50% probability of a second hike. Bailey effectively said that such expectations are disconnected from the reality of the Bank of England's meetings. However, the market is looking not at rhetoric but at the energy price curve: as long as gas and oil prices continue to rise, higher interest rates will be priced in.

Speculative positioning in the pound remained unchanged over the reporting week, while the estimated price is moving increasingly lower.

A week earlier, we expected GBP/USD to decline if the Fed adopted a hawkish stance. This is exactly what happened: the pound fell below 1.3425 and reached the trendline at 1.3325, where it found strong support. We expect further downside, with gains limited by the technical level at 1.3410. Following a short correction, we expect attempts to break below 1.3325 toward the July low at 1.3272.

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

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The economic calendar for the current week is virtually empty in terms of market-relevant publications and events. The main central bank decisions and key macroeconomic data releases are already behind us, while the remaining releases are unlikely to change the current picture. Therefore, EUR/USD traders will focus primarily on external fundamental factors. The key events will be the UN General Assembly and Xi Jinping's visit to the United States.

The General Assembly begins today, September 22, while the general debate will continue until next Monday. However, financial markets are interested not so much in the UN agenda itself as in Donald Trump's diplomatic contacts. In particular, the U.S. president stated the day before yesterday that he was ready to meet Iranian President Masoud Pezeshkian on the sidelines of the summit, although the official details of such a meeting have not yet been agreed. The possibility of such contact is significant for the markets, given the ongoing conflict and continued disruptions to oil supplies. Essentially, the market is being presented with a rare opportunity in recent months for a diplomatic shift that could quickly change the assessment of geopolitical risks.

Traders are assessing the potential outcome of the upcoming negotiations through a direct chain of cause and effect: diplomatic progress ? lower oil prices ? a reassessment of expectations regarding the Fed's future actions ? a weaker dollar. This is particularly important against the backdrop of the September Fed meeting, at which the central bank raised interest rates and maintained a distinctly hawkish stance, focusing on inflation risks. A sustained decline in oil prices would weaken the arguments in favor of further monetary policy tightening and, consequently, put pressure on the greenback. In this case, EUR/USD could quickly return to the 1.15 level, with the potential for further growth.

However, the "Iran case" could also develop in the opposite direction. A breakdown in negotiations, tough rhetoric, or a renewed escalation in the Middle East could push oil prices higher again, increase inflation risks, and boost demand for safe-haven assets. In this case, the greenback would receive double support—both from higher U.S. Treasury yields and from traditional demand for the dollar as a safe-haven asset amid increased risk aversion.

Another important geopolitical event of the week will be Xi Jinping's state visit to the United States, scheduled for September 23–25. The focus will be on Thursday, when the Chinese leader will meet with Trump at the White House. The agenda includes trade tariffs, rare-earth metal exports, purchases of U.S. agricultural products, technology and, particularly important for the commodity market and, indirectly, for currencies, issues related to Iran.

According to preliminary statements from both sides, the United States and China are interested at least in stabilizing relations and extending the trade truce, which expires on November 10. Given the complicated history of the issue, even limited agreements between Beijing and Washington would improve global sentiment and increase interest in risk assets, including the euro.

However, the opposite scenario is also possible here. If the United States and China fail to find common ground on trade, rare-earth metals, and technology, the market will once again focus on the risks of a new escalation. In such a situation, the dollar would again benefit on two fronts—through demand for safe-haven assets and through a potential increase in U.S. inflation expectations.

Thus, over the coming days, EUR/USD dynamics will be determined less by macroeconomic data and more by developments in two geopolitical stories—the "Iran case" and Trump's meeting with Xi Jinping. Any signs of diplomatic progress could weaken demand for the greenback and push the pair back above the 1.1500 target, while another escalation in geopolitical risks would preserve the sellers' advantage.

From a technical perspective, the pair is trading within a channel between the lower and upper Bollinger Bands on H4, namely in the 1.1450–1.1550 level. A decisive break below the lower boundary of the channel would open the way for sellers toward the 1.14 level and, in the longer term, toward 1.1350 (the lower Bollinger Band on W1). At the same time, consolidation above 1.1500 would allow for a move toward 1.1570 (the middle Bollinger Band, which coincides with the upper boundary of the Kumo cloud on D1).

While awaiting the week's key events, the pair will likely continue to trade within the designated range. The further direction of price movement will depend on which sentiment prevails in the market—risk-on or risk-off.