Psychology for major markets Feb 2
Another round of slaughter
EUR/USD – The Euro is seeing some minor rebound after the slaughter on Monday. However, rather than Euro strength, it is mostly USD volatility that is driving the pair to move.
USD/JPY – The initial rebound has stalled as market participants carefully await the result of the February election. What was originally thought to be a good time for power consolidation have seen turbulence as Takaichi's ratings fluctuated. JPY bidders and sellers will be careful to not get wrong footed.
EUR/GBP – Moderately improved tone of recent UK data had EUR/GBP near the lower end of its recent range. Now looking for a fresh trigger with the pair little changed.
AUD/USD – The slump in risk sentiment has dragged the Aussie lower. Until we see improvement in risk sentiment, rebound in the pair is unlikely to be sustainable.
Equities – Risk asset treaded further under water on appointment of Kevin Warsh as next Fed chair along with the flight of fear from the parabolic previous metal. The Nasdaq is seen to be hammered lower compared to other major U.S. equity indexes.