MBCC Trading Highlights 26th October'22 - The Dollar is having a reversal, some covering into next week or something fishy?

The Dollar has had a HUGE reversal the last two days, especially yesterday as the US Bond market rallied hard after a horrific auction on the 2Y. US 10 year bond yields have dropped from 4.30% down to 4.05%. This has coincided with the Dollar falling as Euro is > 1 and Yen back down < 150 and Yuan trading all the way up to 7.21 vs. 7.35 before. Yesterday the market rallied with Gold, Silver, Bitcoin - all long duration proxies up with the Dollar reversal.

When all long duration assets rallied the same time, it smells fishy? Is the Fed active in the Bond market or is this just a short term bounce ahead of the FOMC expecting a pivot?

We discuss this and more today…what do our cross asset models tell us?