The EUR is trading near short-term highs having gained again in trading on Tuesday. Gold as of this morning is around 1585.00 USD. Crude Oil has range traded since testing its short-term lows late last week. In Asia, the JPY continues to weaken. The BoJ has certainly followed through on Prime Minister’s Abe’s mandate to try an re-inflate the Japanese economy. Also of note is that the AUD has climbed to the limits of its one month high against the USD.
Wall Street will continue to see quarterly earnings reports today. The major indexes extended their positive runs yesterday and seemingly are intent on making traders who are still skeptical about the massive gains quite nervous if they have short positions.
French and Italian Industrial Production data will be released today. This will be followed by Crude Oil Inventories, a 10-Y Bond Auction, and the FOMC Meeting Minutes from the U.S. later.
Questions continue to persist about the long-term ramifications of the JPY getting weaker and where it will lead to particularly in regards with Japanese Bonds. Also yesterday another round of cynical thoughts were heard from an investment house questioning China’s economic data and raised suspicions that the numbers are less than accurate. Skeptics have plenty of ammunition to use when discussing the future of the broad markets. Wall Street’s rally is certainly on the list of doubters too. Global economic conditions do not seem to be reflecting the recovery promised by so many politicians and officials. While equity markets have done well, confidence among those on the streets is not particularly optimistic. Retail Sales figures will come from the U.S. on Friday which may give some insight into the heart of the American consumer.
Politicians in an effort to calm the economic waters have been using short-term measures to keep the machine oiled, but long-term questions are not only being asked by investors but include many ordinary citizens now who are wondering how safe their money is. Investors who are wagering that the ‘follies’ of Fed, the ECB, and the BoJ will be exposed and that the house of cards will soon crumble seem to be growing in voice, but as of yet certainly have not been rewarded. Opportunities are aplenty for traders within the current marketplace, trends are proving worthwhile via short-term positions based on momentum, and support & resistance outlooks. However, long-term players who have the stomach to question current market values believe their day will come too and that they will be rewarded.