SUMMARY
USD gained strength on Friday during Janet Yellen’s speech. Sentiments are that there is a possibility for a rate hike in November. This is also confirmed by over 90% probabilities by the FED Watch tool. The expectation by the market is that this will still be stronger going towards 02 November. N.B!!! Some thing which needs to be taken into account is that this is just before the US Presidential election and this might be so likely even though the FED’s BOG are seen to be politically independent. The most likelihood might be December hike. VIX also closed just under $16 where during the past week at shot up to $17.55. This might be a sign that investors might be reacting positively after J. Yellen’s speech. We have to look forward this week also for the high impact news on the calendar involving USD news when trading. JPY has been weaker compare to the USD after the disappointing China data last week. JPY does not seem to have high impact new this coming week except medium ones. We just need to look at the bond market this coming week which impacts on the JPY. The last COT Report indicates that there are more long positions than short positions although the long positions have gone down.