Daily thread to exchange ideas and to share your thoughts
Major currencies are little changed to start the day as the dollar is keeping steadier following a slight advance yesterday.
I reckon China stepping in to limit the USD/CNY depreciation is also helping to keep the greenback more stable over the last few days but short dollar positioning may also warrant for some money to be taken off the table since the November move.
Elsewhere, equities are rallying like there's no tomorrow as the market exuberance continues to reverberate even as Treasury yields break higher.
A key question for the market in the next few weeks will be can the bond market sustain the break higher in yields? Or is this going to just be temporary?
I want to lean more towards the latter but we are likely to see yields track much higher first before any potential retreat again. And of course, we'll have to reevaluate market conditions when the time comes.
Elsewhere, the FOMO rally continues in Bitcoin towards $40,000 but the quick snap back below the figure level yesterday was a taste of the extremely volatile environment.
Meanwhile, gold is stuttering as buyers are seemingly struggling to push for further momentum to start the new month. Price is now lingering close to its 200-hour moving average near $1,907 and a fall below that will see sellers seize near-term control.
There's plenty of individual themes playing out in the market to start the new year and that is keeping things more interesting in the opening week. US non-farm payrolls are due today but that is unlikely to offer much before the weekend comes.
What are your views on the market right now? Share your thoughts/ideas with the ForexLive community here.
