The forex markets are rather steady today. Turkish turmoil seemed to have passed its climax for the near term. Swiss Franc and Yen are trading lower as that part of risk aversion receded. Meanwhile, New Zealand, Canadian and Australian Dollar are generally higher, together with Sterling. Though, it remains to be seen if stock market selloff will extend for reasons other than Turkey. Meanwhile, we want to point out the relatively shallow retreat in Dollar against Euro, Sterling and Aussie so far. Gold's medium term down trend has just resumed and is set to take on 1190. They could be indications that Dollar might take over the driving seat from Yen in the next move. While the trouble of Turkey Lira might be over temporarily, the stocks markets are still rather vulnerable. DOW closed down -0.50% at 25187.70 overnight. S&P 500 lost -0.40% and NASDAQ dropped -0.25%. S&P 500 has been losing much momentum ahead of 2827.82 record high, indicating risk of rejection. Similarly, NASDAQ also faces risk of rejection from 7933.31 record high. In Asia, Nikkei is benefiting from Yen's pull back and trades up 1.85% at the time of writing. But Hong Kong HSI is down -0.97%, China Shanghai SSE is down -0.45%, Singapore Strait Times is down -0.16%. Technically, Yen crosses should have turned into near term consolidations, with risk of stronger recovery. The same applies for Swiss Franc crosses too. USD/CHF and USD/JPY will be two pairs to watch today. Break of 0.9984 in USD/CHF and 111.17 in USD/JPY will indicate near term strength in Dollar against the two safe-haven currencies. And that could prompt stronger rally in Dollar against others as the greenback regains control. |