This week opens on a broadly positive note, with the Debasement Trade flows dominating today’s session.
Profiting from a US Dollar sell-off, Tech Stocks, Commodities, FX Majors, and all rebounded after their struggles last week.
The Nasdaq is actually leading US Indexes for the first time since January 28, pointing to some mean-reversion flows and position closures ahead of this week’s gigantic US data calendar.
But Markets remain skeptical – daily bounces occured in assets that have struggled at the start of February.
US equities are undergoing a stark rebalancing, maintaining the Dow Jones above 50,000, but the Index still faces significant challenges ahead of tomorrow’s Retail Sales and Wednesday’s, before its breakout confirms – DJIA closes the session flat.
Commodities and Gold also rebounded, but face hurdles ahead.
The Bullion reaches $5,100 ahead of the key data, but will have to push above the level to maintain. Some safe-haven bids still underpin demand, particularly after recent Chinese Gold accumulation data.
Elsewhere, Japan’s snap elections were a massive sweep in favor of Sanae Takaichi, removing one of the key catalysts for the Japanese Yen.
JPY is finishing on top of the FX board.
