Just as we were getting a tad nervous about simmering currency wars, the G-7 announces there are no wars — everything is fine.
Then, a G-7 official announces that everything is fine except for the Japanese — who are obviously sort of fighting a little war (see Brainard’s endorsement of same…)
From Reuters about 30 minutes ago:
But, really, everything is fine…except that by now the markets don’t know which way is up anymore. Hopefully by the time the pub crawl lands in Moscow, they’ll have their story straight.
The USDJPY, which had fallen to its channel midline following the Japanese Finance Minister’s comments that the yen’s fall had, perhaps, been a touch more than anticipated, rose on Brainard’s comments, fell on the first G-7 statement, and rose on the second.
The pair remains in our target area, but I wouldn’t put any money on it staying there – or anywhere for that matter. With the press releases flying, who knows where it’ll land when the music stops?
The EURUSD is suffering from it’s own case of vertigo. In a now familiar refrain, the Germans and most northern EZ countries are just fine with the euro’s strength, while the more fragile economies of France, Italy, Spain, Portugal, Greece, etc. are taking it on the chin.
The equity markets have been all over the map, albeit in a tight range the past week. SPX is testing 1518 for the 6th time in less than three sessions.
Apparently, the market can’t accept our assertion that it’s time to sell off. I don’t know why… Goldman did.
Speaking of Goldman, Apple CEO Tim Cook is speaking this morning at their Tech Conference. Apple will offer a live audio feed HERE.
As discussed yesterday, I’ll add an intra-day long to cover any push above 1518.57 — which might be expected after the little IH&S pattern on the 5-min chart.
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