Talking Points:
• A rebound from the S&P 500 seems to usher risk higher, but the last minute respite was better seen elsewhere
• The next sentiment move can offer considerable trade potential, but timing and liquidity should be considered
• China's pressure is still building despite seeming USDCNH calm and scheduled data is set to balloon Friday
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A rebound for US equities seemed to soothe the growing dis-ease in global capital markets this past session. Yet, the S&P 500 doesn't give a true sense of how close to the edge we may still be. Global stock benchmarks and Yen crosses present a more precarious technical picture. It is equally difficult to find comfort in fundamentals. Trouble for China is not neatly encapsulated in the volatility and momentum behind the Yuan alone. A complex situation and complicated system of controls finds fissures in other areas of the financial system - like the USDHKD, currently. Meanwhile, if we are to see a rise or fall in risk trends, there are certain technical plays that are well positioned to for the next move. The trouble is the dwindling liquidity in the twilight of the trading week. To place a trade on a theme as influential as 'risk trends' just before a market lull would be very risky. We look at technical and fundamental opportunity with a consideration of timing in today's Trading Video.
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