Report
EUR 8.84
For Business Accounts Only
http://track.com/articles/the-morning-track-jitters-3/
When you have the jitters, many think you need a shot of whiskey but perhaps the better medicine is caffeine. Early morning fears smooth out after that first cup. The big equity correction hasn’t happened yet but mood has swung and blame for the risk-off approach today has been left with North Korea talking about launching missiles at Guam – not quite the same has threatening an attack like yesterday. The real problem for equities today is in the price and lack of other stories. Markets in Europe are vulnerable and the usual salve of a weaker EUR didn’t work. Similarly, periphery bonds are offered again and the position liquidation from the low volatility, stretch for yield thinking continues. This is a bad case of jitters and nothing more. The US is clearly not ready to bomb North Korea and North Korea isn’t ready to start a war. The rest of the world isn’t amused. The super bears that dominated this rally up are not ready to do the jig either – anyone t
hat would suggest a mere 1.5% drop in Korean equities and 2% move in KRW would be sufficient to capture the risk of renewed war on that Pennisula would have been seen as a rampant bull just weeks ago. Rather we are in a world that has a low base for pain – and a move above the 12 VIX – the 200-day moving average – if sustained could trigger even more. This isn’t to say that FX didn’t have its fill of fun overnight – with the RBNZ doing nothing, promising to do little until 2019 at the earliest and then threatening intervention sufficient to send the NZD off over 1.2%. The Norwegians had their own fun today with CPI driving the NOK stronger – all pointing to the danger of the next set of data today and tomorrow on inflation – as the US and Europe could actually see real reasons to fear central banks normalizing policy. Then again, it’s the summer, its quiet and the real reason to trade is because you have to not because you want to – as in stops are bec
koning particularly in EUR should it break 1.1670 with a test of 1.1525 the risk.
The Morning Track jitters-3
- The Morning Track – Jitters by Bob Savagehttp://track.com/articles/the-morning-track-jitters-3/
When you have the jitters, many think you need a shot of whiskey but perhaps the better medicine is caffeine. Early morning fears smooth out after that first cup. The big equity correction hasn’t happened yet but mood has swung and blame for the risk-off approach today has been left with North Korea talking about launching missiles at Guam – not quite the same has threatening an attack like yesterday. The real problem for equities today is in the price and lack of other stories. Markets in Europe are vulnerable and the usual salve of a weaker EUR didn’t work. Similarly, periphery bonds are offered again and the position liquidation from the low volatility, stretch for yield thinking continues. This is a bad case of jitters and nothing more. The US is clearly not ready to bomb North Korea and North Korea isn’t ready to start a war. The rest of the world isn’t amused. The super bears that dominated this rally up are not ready to do the jig either – anyone t
hat would suggest a mere 1.5% drop in Korean equities and 2% move in KRW would be sufficient to capture the risk of renewed war on that Pennisula would have been seen as a rampant bull just weeks ago. Rather we are in a world that has a low base for pain – and a move above the 12 VIX – the 200-day moving average – if sustained could trigger even more. This isn’t to say that FX didn’t have its fill of fun overnight – with the RBNZ doing nothing, promising to do little until 2019 at the earliest and then threatening intervention sufficient to send the NZD off over 1.2%. The Norwegians had their own fun today with CPI driving the NOK stronger – all pointing to the danger of the next set of data today and tomorrow on inflation – as the US and Europe could actually see real reasons to fear central banks normalizing policy. Then again, it’s the summer, its quiet and the real reason to trade is because you have to not because you want to – as in stops are bec
koning particularly in EUR should it break 1.1670 with a test of 1.1525 the risk.
Provider
Track
TRACK.COM is an independent platform for investment research and market ideas. TRACK.COM research and analysis is used daily by hedge funds, proprietary trading desks, central banks and institutional asset managers to make investment decisions. These clients view Track.com as a trusted partner – our real-time research is thoughtful, well organized and right on target.
Robert Savage
Other Reports from Track
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.