If you’ve jumped on the risk-averse trade or are thinking about it then be prepared for some anxious moments. Dealers say that markets are already noticeably thinner than at the beginning of the week and modest flows may create bigger than expected moves. Some light profit taking in both the AUD/USD and the AUD/JPY has been seen already this morning but dealers say that they are happier sitting short rather than long, where they see more risk.
The big event in early trade will be the opening of the Nikkei. It has been much more bearish than other Bourses in recent weeks so it’ll be interesting to see how it copes with the 3% fall in the FTSE.
