Stocks have come off their losses, helping spark a short-covering bounce in EUR/JPY. Moves are relatively moderate, suggesting speculative position-taking remains pretty limited. When speculators take to the sidelines, they can’t get squeezed out of ill-considered positions. Most positions in markets like these are probably ill-considered, if you ask me.
Liquidation remains the major play with gold the latest victim. Even relative strong performers are suffering against the present backdrop as even winners have to be sold in an environment where many leveraged accounts gave to raise cash to meet redemptions or margin calls.
