Let’s see. I left for about 1+ hours, i CAME BACK AND US500 is up 1&, USDJPY is barely changed, dollar is a touch lower elsewhere, commodity currencies are u a touch higher, and all is well with the world.
Figuring out what is going on behind the scenes can be quite a test of will and dedication. This is one reason I like Bobby’s style who is quietly sticking with technical and really on top of Sterling. I spend hours analyzing money flow and listening to people. If you are novice or intermediate it is best you lean more toward technical attributes and do the education part over time. Right now UsdJpy has flows eyeballing 143.45 again before running into dominant sell pressure.
There is risk flow going into Japan, think Nippon Steel. Economy is not that bad.
The flows in Yen are moving in 2-3 day swaths, with the weaker side being long UsdJpy which gets nailed in stiff fasihion every time they bring it up. Long side was better before recently, it will take quite a bit to change the sell cycle overall. We could find a stalemate and more leveled off condition in a week or so.
Jay I don’t think, other than China, the rest of the major sovereigns are as unstable as people are thinking. Japan will move again soon, US inevitably, Europe is a maybe. There is still a chase for risk, the sky has not fallen, to conditions are softening but not dramatically. So in totality the swatch of varied markets is reacting more in USD as the driver but with spots of the others making adjustments. Bottom line is Usd is still selling and I don’t think it should be a surprise if Euro closes the week over Dollar.
Jay in my experience EurJpy is a better barometer as it runs very closely with Dow.. The pair is down so sticking with UsdJpy which I would wager is continued pricing in and adjustments to rates dropping .25 ahead of the curve and so if it is 25 we see a rally if it is 50 all heck breaks loose. No reason for 50. I still feel they don’t want to sabotage Harris chances and wait for December hoping for stability and strength but if Trump is in they fire the guns ahead of him taking office and cause trouble on purpose either way.
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With the focus on equities to drive the risk tone today, NAS100 has rebounded but has a ways to go (see blue AT lines) before neutralizing the downside risk. The bounce has given it some breathing room but so far just a retracement.
I am beginning to believe the timing for FED cuts is more about global leverage and risk exposure in a wide swath of different markets that is affecting the FED’s decision than it is the job market or simply CPI. Those are vital components but not the entire framework. So understanding significant FED changes usually involves reaction to significant disruption as well, perhaps always does, figuring it out completely is above my pay grade and so gathering a sense of the overall mood could be all you need to anticipate what the FED will do.
A look at the day ahead in U.S. and global markets from Mike Dolan
Wall Street futures have found their feet after Friday’s exaggerated market reaction to an otherwise middling employment report – with Apple’s new iPhone and Tuesday’s presidential candidates’ debate next up on the radar.
