Disliked{quote} Hi sisse, please excuse my ignorance but: "The minute we clear short term risk, Dollar is set to fly high very high" was thinking the other way, (risk = flight to USD) would you mind explaining?Ignored
In a nutshell:
- We got major risk flows from the collapse in China and Commodities (OIL, Copper, etc)
- A couple of circuit-breakers in China with -7% days (you can imagine the size and implications)
- US equities got their worst week since 2011 with a couple of days of -3%... (you can imagine the size implications)
- World equities (especially emergent economies) got the worst start of a year since 2010 (you can imagine the size and implications)
- Oil lost a staggering -16% of its value in only a few days and more importantly in record low levels that triggered PANIC.
As a result:
- Money run to safety first from Equities to cash (dollar & Euro) in the US and Europe.
- Traditional havens like GOLD, YEN, and Dollar for Emerging countries got heavily bought
- then preemptively (in case of major blow in equites and/or OIL) to Treasuries (your BUND rally to 160 for example)
...but as you saw. US printed one the best NFP in years pretty much killing panic via equities (we discussed in detail this on Friday). So the only elephant in the room is OIL. Finding any micro support (check Inventories or OPEC intervention with Oil ticking below $30.xx) will put us back in the natural swing flows (FED hikes, rate differentials, soft euro, ... dollar is going to fly one way or another)
I hope it helps...
sisse
Pending conversations? PM for a chat...I am mainly in OTM now
...as only one of us is going to be right on this one...
