EUR/USD, USD/JPY, Flows: Consolidation on a quiet day, same big picture issues
After a few wilder sessions, market in quiter consolidation amid stretched moves, quiet calendar
Same big picture issues remain in the background, payrolls next extra input
A very quiet day ahead and that is playing to consolidation and some modest backfilling of the sharp action in recent days as USD/JPY and the dollar in general got a little oversold intraday – though remains stretched very long outright in terms of overall spec positioning.
Oil also consolidating mildly upwards, nudging into Monday’s gap to see if the latest US pause goes anywhere or continues to see Iran call the US bluff amid the contradictory claims about whether talks are proceeding or not.
Outside of these big background forces, the other key event of the week remains payrolls, not up until the end of the week, though with ADP on Wednesday. It will be interesting to see how the market chooses to react to that data when it arrives, if any notable surprise is seen, given the sceptical mood that emerged from the last Fed meeting.