Escape Velocity

We have been waiting for a day of flat Treasury yields to see how the dollar would react. Early signs aren't encouraging for dollar bulls as it slumped across the board as the worst performer Tuesday. Maybe that was a simple retracement after a six-day move but maybe it was a sign that the dollar bid is fleeting.
We liken it to a launching rocket that needs incredible amounts of fuel to rise higher, rather than a spaceship that will coast along in orbit. Rising bond yields have been the fuel since the Georgia runoffs but they sputtered Tuesday after a strong auction and the dollar nosedived immediately afterwards.
For its part, Fed talk continues to be a modest tailwind. Comments continue to focus around better economic prospects and tapering. We will hear from Brainard and Clarida Wednesday but all the chatter about more QE or a WAM extension is gone.
We will continue to keep a close eye on the dollar in the day ahead, along with a 30-year auction that could steer the next move. If this is it for the dollar bounce, it's a feeble one even by the standards of short squeezes.Latest IMTs
-
موعدنا الآن في غرفة شركة إكس أم لجلسة الأسواق
by Ashraf Laidi | Aug 15, 2022 15:43
-
Gold was the Easy Part
by Ashraf Laidi | Aug 4, 2022 19:29
-
Trading Narratives vs Stats
by Ashraf Laidi | Jul 28, 2022 14:28
-
ECB Wakes, Nasdaq Leads, Yields Doubt
by Ashraf Laidi | Jul 21, 2022 19:34
-
Nearing Total Yield Curve Inversion
by Ashraf Laidi | Jul 12, 2022 15:43