Here is what you need to know on Monday, September 23rd: Risk aversion took over the market Friday on escalating trade tensions, and would likely persist Monday, following news indicating that the Pentagon will deploy US forces to the Middle East, which will be “defensive in nature,” a result of the Iranian attack on Saudi Arabian oil facilities. During the weekend, the Saudi Foreign Minister said that if the attack was launched from Iran, it would be considered an act of war. Meanwhile, Houthi rebels in Yemen have warned foreign diplomats that Iran is preparing a follow-up strike to the missile and drone attack on Saudi Arabian oil and gas facilities. The run to safety and the lack of progress on the Irish backstop weighed on the Pound. Safe-haven assets were the best performers, with gold and yen poised to extend their advances. Cryptos maintain the bearish tone, could turn north on persistent risk aversion.

While speaking at Labour’s annual conference on Sunday, the UK opposition Labour Party leader Jeremy Corbyn said: “I am leading the party, I am proud to lead the party, I am proud of the democracy of the party and of course I will go along with whatever decision the party comes to.” He said in response to the question asked whether the Labour Party would campaign to remain in the EU or to leave with a deal, BBC News reports. The Cable witnessed a volatile Friday session, having reversed sharply from 11-week highs near 1.2580 to finish the week near the lower levels of 1.2470 amid trade pessimism-led risk sell-off, as markets ignored the upbeat comments from the European Union (EU) Chief Brexit negotiator Barnier. EU's Barnier: Determined to try and reach an agreement with UK

In an interview with CNN late-Saturday, Saud Arabian Minister of State for Foreign Affairs Adel al-Jubeir, “We hold Iran responsible because the missiles and the drones that were fired at Saudi Arabia...were Iranian-built and Iranian-delivered.” Additional Quotes: “But to launch an attack from your territory, if that is the case, puts us in a different category... this would be considered an act of war.” “If they continue along this path, then they risk the possibility of military action.” “But nobody wants war. Everybody wants to resolve this peacefully and the end result has to be an end to Iran’s aggressive policies.” “Appeasement with Iran does not work. For example, trying to set up a parallel financial payment system is appeasement. Trying to give them a line of credit is appeasement. It just emboldens them.” “The Iranians have to know that there will be consequences to their actions.” Meanwhile, the Wall Street Journal (WSJ) reported on Saturday that Yemeni rebels warned ..

The Wall Street Journal (WSJ) quotes people familiar with the matter on Sunday, Houthi rebels in Yemen have warned foreign diplomats that Iran is preparing a follow-up strike to the missile and drone attack on Saudi Arabian oil and gas facilities a week ago that knocked-off 5% of the global oil supplies. The sources confirm that the last attack was forced by Iran and are said to have passed the information to the Saudi and the US about the warnings. Should there be another attack, it could flare-up the tensions between the US and Iran and propel oil prices through the roof once again. Both crude benchmarks settled the week nearly 6% higher, with WTI flat at the close above the 58 handle while Brent finished near 64.60 region.

China’s state news agency, Xinhua, reported on Saturday that both the US and Chinese trade teams had “constructive” discussions in Washington, as cited by Reuters. Xinhua added that the US and China agreed to keep communicating on related issues, and discussed the details of the next round of trade talks in October. However, no details of the discussions were provided by the Chinese news outlet. This comes despite the overnight reports that China’s agriculture delegation canceled the US farm visit to Montana and they returned to China sooner than expected. The above headlines sent the risk sentiment tumbling in the US last session, knocking-off the stocks in tandem with the Treasury yields. USD/JPY lost nearly 40-pips to close the week near four-day lows of 107.53. US Pres. Trump: Agricultural purchases will not be enough, we want a complete deal

EUR/USD ends the week in the lower part of its range but struggle to generate any meaningful breakdown. The level to beat for bears is the 1.1000 handle. EUR/USD daily chart The common currency, on the daily chart, is trading in a bear trend below its main daily simple moving averages (DSMAs). The Euro ends the week stuck in a two-week trading range as investors are waiting for the next catalysts. There will be a plethora of news announcements next week, including the Gross Domestic Product in the United States. Therefore, there is potential for volatility and the current range may get broken. EUR/USD four-hour chart EUR/USD is trading below its primary SMAs, suggesting a bearish bias in the medium term. The Euro has been ranging for most of the week. However, bears will probably try to break the 1.1000 handle to potentially reach 1.0965 and 1.0930 support level near the 2019 low, according to the Technical Confluences Indicator. EUR/USD 30-minute chart Bears will try to keep ..

West Texas Intermediate prices were trading -0.22% lower in the Wall Street close. West Texas Intermediate crude for October delivery lost by 4 cents, or 0.07%, to finish at $58.09. Can Saudi production be restored? West Texas Intermediate prices were trading -0.22% lower in the Wall Street close having edged lower from a high of $59.23 to a low of $59.97 while futures registered a sharp gain for the week, 6% higher and considerably higher on the attacks on Saudi Arabian production facilities last weekend which put into question how much spare capacity there will be left in the oil market leading to the biggest weekly gain in 3 months. As for futures, West Texas Intermediate crude for October delivery lost by 4 cents, or 0.07%, to finish at $58.09 a barrel on the New York Mercantile Exchange. The contract logged a 5.9% weekly advance, which was the biggest for the U.S. benchmark since the week ended June 21. Saudis revealed the extent of damages Oil eased back from the opening hi..

The Nasdaq Composite Index lost 65.20 points to reach 8,117.67, a decline of 0.8%. The Dow Jones Industrial Average lost 160.60 points, or 0.59%, at 26,934.19. The S&P 500 index dropped 14.89 points, or 0.5%, to 2,991.90. The technology sector dragged US stocks lower on Friday following the news that the Chinese delegation, visiting the US negotiators this week, cancelled plans to visit farms in Montana as a part of its negotiations with the U.S. delegation - President Trump declared he would not accept a partial trade deal. The benchmarks closed in the red for the first weekly decline in a month and the Dow Jones Industrial Average lost 160.60 points, or 0.59%, at 26,934.19, while the S&P 500 index dropped 14.89 points, or 0.5%, to 2,991.90. The Nasdaq Composite Index lost 65.20 points to reach 8,117.67, a decline of 0.8%. US data will also be key Looking ahead to next week, US data will be a keen focus following the Federal reserve's announcements earlier in the week. "Th..

Spot Gold was around 1% higher, travelling from a low of $1498.09 to a high of $1516.38. The Gold and Silver ratio added to the mid-week bullish correction. Silver prices inched higher to short term trendline resistance. Precious metals gained on Friday following the news that Chinese and US trade talks were cut short while troubles in the Middle East continue to concern investors, and US benchmarks closed in the red, fueling a flight to safety. Spot Gold was around 1% higher, travelling from a low of $1498.09 to a high of $1516.38 while Silver prices inched higher to short term trendline resistance, walking into the Wall Street close around 0.90% higher having travelled from a low of $17.75 to a high of $17.98. The Gold and Silver ratio added to the mid-week bullish correction, moving up from a low of 83.84 to a high of 84.71, around 0.30% higher on the day. As for futures, Gold for December delivery on Comex added $8.90, or 0.6%, to settle at $1,515.10 an ounce, after retreating..

The Greenback rose this Friday but remains trapped within its weekly range. The level to beat for bulls is the 98.55/98.68 resistance zone. DXY ends the week about 45 cents higher. DXY daily chart DXY (US Dollar Index) is trading in a bull trend above its main daily simple moving averages (DSMAs). In the last two weeks, the Greenback has been in a trading range around the 98.40 level as investors are waiting for a catalyst. DXY four-hour chart DXY is trading above the 50/200 SMAs, suggesting bullish momentum. The Greenback gained some relative strength this Friday as it broke above the triangle pattern. The market is retracing down and buyers will need to defend the 98.42 and 98.20 support if they intend to lift the market towards 99.10 and 99.38 resistances. The market would need a daily close beyond 98.68 to pull away from the trading range. DXY 30-minute chart DXY is trading above the main SMAs, suggesting bullish momentum in the near term. Support is seen at the 98.42 and..

Kaplan: Have pencilled in no further rate cuts this year, one rate cut next year. Rate cuts this year make it more likely 10-year yield will rise. Dallas Federal Reserve's President Robert Kaplan on Friday has been crossing the wires throughout the afternoon, earlier arguing that economies need a broader menu of other policy tools than just monetary policy, expecting the economy to expand by 2% in 2019 and around 1.7% in the second half of the year. In more recent trade, Kaplan has made the following remarks: Have pencilled in no further rate cuts this year, one rate cut next year. Agnostic about further rate cuts this year; Not opposed, nor leaning toward it. To be open-minded is watching how trade tensions unfold, does not want to prejudge. Rate cuts this year make it more likely 10-year yield will rise. Should ‘seriously examine’ plans to allow b/sheet increase with growth in demand for reserves. FX implications: In a world of central banks easing across all corners..

Analysts at CIBC expect the NZD/USD pair to trade at 0.64 during the fourth quarter and to rise later to 0.66 by the second quarter of 2020. They see that improving fundamentals could help Kiwi. Key Quotes: “Since the OCR cut in early August, NZD/USD has fallen to multi-year lows of 0.6269, pushed down by expectations of further rate cuts down the road. Business investment in the region remains lackluster, with the confidence index dropping to the lowest level since April, reflecting global trade tensions. Retail sales have also underperformed due to lower fuel sales. Consumer confidence improved in August to 118.2, but remains below the 120 historical average as declining house prices weigh on sentiment. We do not see these themes changing over the coming months, and as such, there’s less scope for an extension higher in NZD driven by improving fundamentals.” “The 50bps cut in August was far more aggressive than the market expected and was done to ward off the need for additional..