Equities Bounce and Dollar Continues Higher, Which is Most At-Risk?
• Just as risk aversion was starting to gain traction, volatility cooled and the S&P 500 jumped Wednesday
• The jump in sentiment has more to do with complacency than a genuine optimism
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Just as the S&P 500 - as a proxy for sentiment - starts to look over the edge, bearish conviction dries up. However, this move likely has little to do with a sudden optimism nor the material rebuff of burgeoning bearish interests. It is instead an attribute of the complacency that stands as the market's defining trait. As we keep an eye on risk and its indefinite - yet finite - hold on the market, monetary policy speculation looks to take the reins for the majors. Strong Treasury auctions this past session drove the dollar higher. What will speeches from key members from the Fed, ECB, BoE and RBA ahead do to the FX market? We discuss that in today's Trading Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.