As we enter the last week and a half of late September the broad markets are showing distinct signs of caution. The EUR has come off of its highs versus the USD. Gold has declined slightly, and Crude Oil suddenly doesn’t seem to have much support.

Today will see plenty of economic data and a 10-year Spanish Bond Auction is also in the cards. PMI Manufacturing and Services readings will come from Germany and France shortly. The U.K. will then follow with its Retail Sales report which carries an estimate of minus -0.3%. And then the Americans will enter the circus with weekly Unemployment Claims and the Philly Fed Manufacturing Index. The Fed report from Philadelphia will be of keen interest to investors because earlier in the week the Empire State Manufacturing Index statistics came in far worse than anticipated. Today’s Philly forecast is looking for a negative -4.1 outcome.

What has changed in the marketplace compared to last week when everything flowed like wine and the smell of roses were in the air? It could be that the good news was baked into the cake already. Essentially traders took the markets higher and were willing to exhibit risk taking with a strong belief that the ECB and Fed would get their collective ways – and they did. However equity markets this week have suddenly stopped their climb. Wall Street did gain yesterday, but not in the most convincing of fashions. Considering all of the help that the Central Banks have given equities with non-existent bond yields, there is more than an enough room for a pause. But if caution becomes fear in this trading environment the road could get more than tough. October is historically a month that has served up a harsh dose of reality to the over eager and with plenty of economic data on the way and many quarterly earnings coming up in a couple of weeks time from corporate America investors cannot be blamed for surveying the landscape.

The AUD and GBP have also traded lower against the Greenback in the last couple of days.  The AUD may have appeal to certain participants who are looking for some more short-term weakness. Gold as of this morning is trading around 1764.00 USD and again is reflecting the Single Currency’s decline. Commodity prices by and large have traded downward the past couple of sessions. Traders need to be cautious in the grains, particularly Soy Beans because of a rather divergent amount of views that are being circulated regarding crop prospects and weather related issues. However, the metals and energy sectors have certainly showed that some of the speculative flair that surrounded them has floundered the past few sessions. There is no doubt that some profit taking could be part of the catalyst for falls in the Crude Oil, Copper, and Coffee, but it could be too that their respective markets found values that could no longer be supported.