USD, JPY, EUR, NOK, CAD oil flows: Ever present weekend risk
Recent pattern of hope for the best, hedge for the worst heading into w/e
The market has got used to weekend ‘tweet risk’ and the tendency for things spun positively at the end of the week to have gone off the rails by Monday. Looking at oil (Nymex front contract) for instance its fairly apparent- Monday’s open-close has typically been by far the worst day of the week (some 1 stdev above average for price gains) with 90% being up days for oil since the Iran conflict kicked off.
Doesn’t mean that this weekend a holding ‘framework agreement’ can’t surface to kick the can and that next week starts with a welcome exception (this Monday was also a rare benign one in fact), but its natural enough to be heading into the weekend not getting carried away with any positive headlines and in somewhat defensive mode unless we really do get some breakthrough news today.