Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
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The real rate (top candlestick chart) has declined since Friday, 22 Oct. This yield has a causal relationship with the greenback, and FXCM's USDOLLAR basket has followed it downwards. The H4 correlation coefficient between the two is a strong 78%. I.e. and further pressure on the real yield will likely ripple to the dollar.
Bond market participants have made their move. Given the decimation of bond prices for 2022, value investors were bound to come in at some stage. It looks as if today is that day.
The XAUUSD daily chart shows the precious metal slipping back into its bearish area between the lower blue and red bands. The last candle is still active, and its close will be necessary regarding its relative position.
This development comes as Rishi Sunak takes over as the new UK PM. As a result, politically uncertainty has waned, which looks to be translating into lower volatility in the near term. However, the UK economy still faces headwinds, and cable requires watching as policymakers manage these.
This may be a case of buying the rumour, selling the fact. Market participants will look carefully at Sunak's fiscal policy. He needs to restore faith following the adverse reaction to Trusseconomics.
Since Friday (black dashed vertical), US 10-year real rate (top candlestick chart) has declined. At the same time, the US30 (bottom candlestick chart) has appreciated. The two have a correlation coefficient of -65%, reinforcing the inverse relationship.
If the BoJ abandons the defense or alters it to a higher level, the market repercussions will be severe as USDJPY and JPY pairs reprice. Of course, it is anybody's guess when this might be. However, given the costs to prop up the yen, and its ineffectiveness, market participants should be very wary of the inherent risks when trading USDJPY and JPY crosses.
As long as inflation remains a worry and the prospect for higher rates persists, demand for risky assets, including cryptocurrencies, will be facing headwinds.
The GBPUSD daily chart shows that a lower peak has charted. Therefore, if the currency pair drops below 1.0920 (green horizontal line), a lower trough will chart, and cable's technical downtrend will continue.
The intermarket implications suggest a risk-off environment as the higher yield pressures the present value of risk and capital rotates towards the greenback for safety.
UK Prime Minister Liz Truss announced her resignation today. A run on British gilts and volatility in GBPUSD has primarily defined her six weeks in office following a failed gamble at expansionary fiscal policy and trickle-down economics
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