Week End Position Squaring Forces a Pause
Eventually, we all knew the USD would consolidate and begin to show signs of life again. Obviously, it was just a matter of time, and of how far the big dollar could fall, before that eventuality came to pass. Now traders have begun to take a sober second look at the market’s position ahead of the weekend, and have chosen to book profits and bolster the reserves in their respective war chests so as to be best prepared for whatever the market brings us next week. Most asset classes have seen a profit-taking inspired retracement from the levels achieved this week, and the dollar index is trading up by more than 0.60%.
Equities in Asia turned lower overnight, with the Hang Seng shedding 2.26% of its value while the Nikkei limped to deliver a 0.33% decline at the close. The FTSE in London has traded roughly 0.4% lower as we head towards the close, while the CAC in Paris and DAX in Frankfurt look to at least finish the day in the black, though not by very much. Equity futures are pointing to a slightly positive opening in New York, while Toronto looks to be in the mood to see a turn lower. This would most likely be because commodities have softened, having this week’s outsized rally in hard assets as a hedge against long-term inflation. Read Full Article »
