It's all about the Yields

22 February, 2021

Equities heavy as Yields, Copper and VIX soar. USD recovers from lows; safe haven JPY & CHF suffer. US10yr yields touched 1.38% (now 1.345%), Equities closed down on Friday and for the week, FUTS now into 5th day lower. Reflation trade & progress in vaccination worldwide, especially in developed economies, helps commodity currencies & boosts sentiment for riskier assets. Commodities lifted (especially Copper) – except Gold ($1790) which appears to be losing its inflation hedge status to BTC, (new ATHs over $57K). VIX FUTS up 4.4% to 25.80.

  • This week – RBNZ rate decision, Progress on stimulus 1.9tn stimulus package, US GDP, Durable Goods, Consumer Confidence, PCE & Powell testimony. Earnings season continues (392 of S&P500 reported – 80% have beat estimates)
  • Today – German IFO, ECB’s Lagarde, Fed’s Bowman. UK PM Johnson to outline lockdown exit plans for England. Earnings from Marathon Oil & Occidental Petroleum.

Biggest (FX) Mover @ (07:30 GMT) USDCHF (+0.34%) Rallied from 200MA on Friday (0.8940) Over 20 Ma Friday over R1 and R2 today – moving to test 0.9000 Faster MA’s aligned and trending higher, RSI 72 OB but still rising, MACD histogram & signal line aligned higher and broke over 0 line on open today. Stochs. very OB and touching 100. H1 ATR 0.0009 Daily ATR 0.0080.


Source  
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