Psychology for major markets September 23rd

EUR/USD – EUR sentiment turns negative on weaker than expected PMI data. US PMI data awaited to determine whether this is a global or local story, but in either case EUR/USD downside risks dominate

USD/JPY – Turning lower following weaker European PMIs after a week of gains. Upside likely capped near 145 but more hawkish BoJ or weaker equities needed to retest 140.

EUR/GBP – Broke to new lows for the year at 0.8355 after weak Eurozone PMIs with UK PMI less weak, but EUR/GBP now at low levels and hard to see much more downside unless UK outperformance is much clearer.

AUD/USD – Better risk sentiment supporting a test of the top of the year’s range at 0.6839, but better China sentiment likely required for a convincing break higher.

Equities – New highs in S&P 500 but valuations looking stretched with yields also higher