There is no economic data that could change the channel in US trading
With the economic calendar bare save for the lowly Chicago Fed National Activity Index, the market will be left to its own devices today.
S&P 500 just fell to a fresh low, down 79 points to 1892.50. If you're not at least pondering the possibility of some kind of 'Black Monday', you don't know how long a market can stay irrational.
There is money to be made today by being a hero but I suspect much more money will be lost on bravery than gained. The October 2014 market panic ended when the Fed's Bullard blinked. He was a hawk but hinted at continued QE when the market spooked him.
Today, the Fed's Lockhart is on the schedule, but not until 1955 GMT (3:55 pm ET). You can at least put some of the blame on him for this rout. Earlier in the month he said "It will take a significant deterioration in the economic picture for me to be disinclined to move ahead" with a rate hike vote.
What he didn't say was how he would respond to a market crash.
What next?
The open will be a bloodbath. Everything we've seen so far will extend. But we'll see the worst of it before New York heads to lunch.
But predictions are cheap and I don't have money to wager catching a falling knife. If/when markets bounce, they will bounce a long ways and catching the first part of the rally isn't worth the risk.
Unless Lockhart blinks. Then it's yet-another sign the Fed will never abandon the market. In FX, the kneejerk would be to sell the US dollar there but, on the contrary, it would cause a revival in the carry trade and the euro would suffer (and the yen moreso).
