Forex: Dollar Rebound and Dow Plunge Suggest Trend Development
The FOMC minutes didn't offer a comprehensive change to market sentiment, but they did present support for a long-depressed fundamental theme: risk aversion. In the transcript from the Fed's July 31 policy meeting, we learned that the group was in broad agreement with the timeline for the Taper that Chairman Bernanke offered at the June press conference. As the market's certainty of a September move to ease back on stimulus grows, the building deleveraging of risky exposure in Emerging markets, carry trade and even Treasuries spreads to moral hazard-strongholds like the S&P 500. We discuss how the development of underlying fundamental themes can leverage market trends as well as key trade setups in today's video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.