Equities, Oil, Yen Crosses and CAD Rebound as Fear Cools
• The jolt of panic through Wednesday didn't carry over to Thursday's trading session
• An ECB rate decision was top event risk this past session, Global PMIs will top Friday's list
• While event risk may not threaten igniting key themes, Fridays have proven dangerous in 2016
The mood in the market is tense. While the bout of severe risk aversion through Wednesday hasn't been revisited, fear has been a common theme in 2016. Between key technical levels, easily identifiable news targets (global growth, China, slowing revenues, etc), broad correlations and volatility; this is a market that isn't difficult to rouse. In the meantime, the respite has offered an opportunity for some stretched moves to correct under profit taking. Equities, Yen crosses, commodity currencies and oil have all seen a modest counter-trend move. This period of calm should be considered limited with heavy event risk due next week. Calling the ultimate return to trend - whether reversal or reinforcing risk aversion - from this side of the weekend would be very risky. Short-term trades are more appropriate for current conditions. We look at dominant trends and current conditions 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.