Another soft January data point raises more questions about the US economy. The drop in new orders was the worst since Dec 1980. Poor weather is the excuse for any bad news but traders have to be asking themselves “what if it isn’t bad weather?” and manage the risks from there.

The problem is that if it is bad weather, your upside is limited because that’s widely priced in. If it isn’t bad weather that means almost everything the market believes about the US economy is wrong and the Fed is tightening policy in the jaws of a slowdown.

If that’s the case, you can understand gold longs as a hedge. In USD/JPY the technicals told the story: 102.00 was the level and it’s broken, nothing more to say.