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Global markets have opened lower and are looking to find a base to hold, or break. Ahead of Earnings season that starts this week we are likely to see plenty of movement in these markets as they adjust fair value on stocks and bonds.
The Japanese Nikkei is lower by over 1%, oil and gold are lower, and S&P futures are off by 1%; all-in-all, a Usd positive. But, we are not seeing dramatic dollar buying that matches the moves, so far.
Global equity markets are looking weak, and the Trend reads are at a swing point that will require the Momentum to soon reverse course from oversold if they are not to all go short, TheLFb Trade Team said. The equity bear has already visited some regions; a Usd positive. Oil, gold, have short reads, and are now showing overall weakness.
The dollar may find buyers near-term, but watch the reversals as the afternoon Asian session gets underway. A mixed picture is unfolding that shows fundamental moves in global equity and commodity markets that are testing support from last week, but at the same time are not transposing themselves into equivalent Usd buying, as yet.
We have seen for months that dollar buyers are transient, looking only to hedge a falling equity or commodity market, and that they do not seem to want to hold the greenback for any longer than they have to.
The way that equity markets look right now, there may not be an option but to buy dollars as stock values drop. We have nothing clear-cut enough to signal a move on as yet, and really need to see the afternoon Asian session unfold to gauge momentum, the Trade Team added.