Just getting a second wave of selling which has driven the dollar lower. It’s still hard to tie the news in with these moves. The PBOC liquidity is a 3 month operation which doesn’t suggest it’s a stimulus injection.
What is probably happening is that the news has rattled traders ahead of the FOMC and that we’re seeing some position adjustment that probably would have come tomorrow.
I’d be wary of chasing these moves as there’s enough going on and coming up and you run the risk in being caught slap bang in the middle of it and in a terribly positioned trade.
The moves are also hitting commodities with WTI now trading up through 93.00 to 93.68. US Copper has also jumped up over $12 since the Chinese story hit.
US Copper 30m chart 16 09 2014