Extreme volatility was seen in the markets last week, in particular in the across the broad rout in cryptocurrencies. Stocks the tumbled sharp but stage a late come back. Gold and silver resumed recent decline. Yen ended as the best performer, helped by both risk aversion and pull back in benchmark treasury yields. However, overall sentiments seemed to have stabilized with help from Fed's clear communications. Yen could turn into range trading, experiencing counter forces of stabilizing risk sentiment and pull back in yields. Also in the currency markets, Canadian and Dollar were the next strongest. Australian Dollar was the worst performing followed by Kiwi, and then Swiss and Euro. As risk sentiment stabilizes, the decline in Aussie and Kiwi could at least slow, with prospect of stronger recovery. Euro on the other hand, is starting to look increasingly vulnerable. It looks inevitable that Euro will break through 2017 low against Dollar soon. Also the path, there are downside risks in the common currencies in crosses too. |
