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Stock Market Declines: Algorithmic Trading Impacts Dow, S&P 500

The Dow Jones Industrial Average closed down -420.22 points on the day, and gold winds up becoming the only major asset performer to close in positive territory for the session.  The ten-year Treasury was also moving lower to 2.23%:

10 Year Treasury Bond
10 Year Treasury Bond

Fed Chair Powell garnered most of the attention in today’s TV media but macro markets were influenced by US President Donald Trump and his daily Twitter barrage:

Donald TrumpTweet
Donald TrumpTweet

These are some of the administration’s strongest trade comments to date.  Will Donald Trump start a trade war?

Forex / US Dollar

Trump’s tweet, however, guided the narrative in an entirely new direction — and the US Dollar suffered as a result.

US Dollar Index
US Dollar Index

Of note for forex traders was the release of the quarterly GDP figures in Switzerland, which came in very strongly at 1.9%.

Swiss GDP
Swiss GDP

This beat already-high expectations of 1.7% and were much improved relative to the 1.2% gain that was posted during the previous quarter.  

USD/CHF Forex Chart
USD/CHF Forex Chart

The USD/CHF is a currency pair that is often associated with safe haven buying during times of economic uncertainty or volatility in the stock market, so this is a currency pair that could be on the radar for forex options traders for a good portion of this year.  After the data was released, the USD/CHF moved to new lows near 0.94.

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