Forex Today: trade war overshadows it all

Here is what you need to know on  Monday,  August 26rd:

– TRADE WAR: Following China’s announcement on tariffs on US goods early Friday, US President Trump struck back.  After the market closed, the US announced that starting on October 1st, the $250B of goods coming from China currently being taxed at 25%, will be taxed at 30%, while the remaining $300B of goods will now be taxed at 15% starting September 1st.

–  BREXIT: Weekend headlines related to the future of a trade deal showed crossed accusations on whether who will be responsible for a no-deal Brexit. EU Council President, Donald Tusk, said that the Union is willing to help the UK, although not in the case of a no-deal. UK PM Boris Johnson responded that if the EU “don’t want a no-deal Brexit, then we’ve got to get rid of the backstop from the treaty.” Meanwhile, news indicated that PM Johnson had asked the UK’s attorney general, whether Parliament could be shut down for five weeks, to prevent MPs forcing a further extension to Brexit.

–  Major pairs set to open with gaps, as none of the above-mentioned headlines were priced in.

–  Safe-havens soared, with the Yen and Gold likely to extend their rallies.

-Crude oil prices fell, as mounting tensions between the US and China would likely lead to decreasing demand.

-Cryptocurrencies at a brink of turning bearish. However, the ongoing risk-averse environment could give them a boost this week.