Was Friday just a taste of things to come?

The demand for liquidity and security has sent panicked investors to the US dollar.  However, with the world’s largest economy wading slowly into a recession and interest rate speculation pointing towards the lowest returns from US assets in history, how long can the greenback’s rally last?

After falling nearly 6 percent last week and testing critical support at 1.2500, many are hoping that EUR/USD will finally turn higher soon.  However, Euro-zone economic releases will be working against that as nearly every report is forecasted to deteriorate.

Should the world’s policy makers proffer another coordinated effort to encourage calm in the markets, an overextended yen could see a sharp pull back as general risk appetite finds its way to a relief rally.

Is there rebound potential for the British pound next week?

Gold and the streetTRACKS Gold Shares (GLD) had an interesting session, but their fate may be increasingingly linked to the direction of euro.

The FOMC is meeting next week and the general consensus is that they will indeed cut rates.

The most anticipated event risk next week is the Federal Reserve’s interest rate decision.

The US dollar and Treasuries surged on Friday as deleveraging led funds to flow away from stocks, commodities, and carry trades into safe-haven assets.

Professional system trader Art Collins shares his daily biases in the index, bonds and currency futures markets for October 24.