The market is dead today:
- EUR/USD -8 pips
- USD/JPY +15 pips
- USD/CAD +2 pips
The only G10 currency that has had any sort of significant movement in the New Zealand dollar.
Trading is an exercise in listening. There are many sounds and melodies to contemplate but silence is a song as well.
A big move in the market always means a great deal but the absence of movement can say something as well. All else being equal, I would have expected a rebound in the hardest hit trades — like EUR/JPY. I would have especially expected a bigger rebound given the lack of tape bombs from Italy and the upbeat US economic data today.
In this case, I take the silent market as a signal that declines in risk trades and yen crosses are more likely to continue. That said, there is a risk we see another attempt to rebound tomorrow and I’m particularly weary of headlines that sound like Italian political cooperation.
