Stocks, currencies, commodities, bonds–all are acting as they should if one assumes a recovery is underway. Today’s earnings numbers and home sales data have combined to give the trades and investors a very hungry appetite for risk. US equity markets are at their highs for the year, oil is back above $66 dollars from recent lows at $58 and the commodity currencies are back toward levels seen at the height of the reflation boom which petered out in early June.

Markets look to be undergoing some consolidation but the underpinnings look solid for the moment. EUR/USD trades at 1.4250, USD/JPY at 94.87, AUD at 0.8205.