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EUR 9.28
For Business Accounts Only
http://track.com/articles/the-morning-track-neutral/
Between the Dutch election and the FOMC, the economic data is lost. The march into these events has been notably less volatile with various explanations as to why – the winter storm yesterday in the US NorthEast, the learned de-risking strategy from 2016 events, the ongoing faith in easy money from the ECB/BOJ. Neutral into an event, risk-on after one has become the new normal for trading. The problem with this strategy will only appear when the news drives the fundamentals so far away from expected outcomes that it fully reverses the trend. For most this is about US rates going up, USD going up, US equities going up. The one area that isn’t in trend but was is commodities – and that might be the best place to focus for the day with oil and gold both looking confused from a price momentum point of view. The oil bounce back from API isn't enough. The real risk mood maybe in that we see traders act like new drivers moving from 1st to 5th gear on the FOMC/Dutch vote
. Overnight, the news focus was on UK unemployment falling to 41-year lows but wages dropping as well. This leaves the US news onslaught as the next risk with CPI and retail sales both important stories but unlikely to sway the wait-and-see trading mentality. The best way to look at risk into an event is to focus on the weakest trend and that of the 3 listed is the USD which wobbled a bit overnight tracking the US bond market. If after Yellen and the Wilder vote count in the Netherlands we are below 102.26 in US dollar index – look out for a larger shove back to 99.
The Morning Track neutral
- The Morning Track - Neutral? by Bob Savagehttp://track.com/articles/the-morning-track-neutral/
Between the Dutch election and the FOMC, the economic data is lost. The march into these events has been notably less volatile with various explanations as to why – the winter storm yesterday in the US NorthEast, the learned de-risking strategy from 2016 events, the ongoing faith in easy money from the ECB/BOJ. Neutral into an event, risk-on after one has become the new normal for trading. The problem with this strategy will only appear when the news drives the fundamentals so far away from expected outcomes that it fully reverses the trend. For most this is about US rates going up, USD going up, US equities going up. The one area that isn’t in trend but was is commodities – and that might be the best place to focus for the day with oil and gold both looking confused from a price momentum point of view. The oil bounce back from API isn't enough. The real risk mood maybe in that we see traders act like new drivers moving from 1st to 5th gear on the FOMC/Dutch vote
. Overnight, the news focus was on UK unemployment falling to 41-year lows but wages dropping as well. This leaves the US news onslaught as the next risk with CPI and retail sales both important stories but unlikely to sway the wait-and-see trading mentality. The best way to look at risk into an event is to focus on the weakest trend and that of the 3 listed is the USD which wobbled a bit overnight tracking the US bond market. If after Yellen and the Wilder vote count in the Netherlands we are below 102.26 in US dollar index – look out for a larger shove back to 99.
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Robert Savage
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