Here's your 20-second guide to what Aussie traders will be talking about this morning

BOULDER CITY, NV – OCTOBER 23: Jaxson Kidd rides a training steer, as his wish is granted from the Professional Bull Riders to be a cowboy for a day at the Boulder City Horseman’s Association on October 23, 2014 in Boulder City, Nevada. (Photo by David Becker/Getty Images for Professional Bull Riders)

– Last night saw a massive reversal of fortune for the US dollar which surged back after being pummeled in the wake of the Fed’s decision, statement and Janet Yellen’s press conference. The upward pulse yesterday morning in the Euro, Aussie and others didn’t actually accelerate from the mid 1.07 region until a reasonable way through the presser when Yellen started talking about the impact of the stronger dollar on exports. It was a comment, which traders rightly recognised, as a tacit admission the Fed wasn’t immune to, nor would they ignore, other people’s currency wars. But the massive squeeze pulled up perfectly at technical resistance in the Euro and Aussie. So a reversal was always on the cards. But last night’s snapback was one for the books. Euro is off 2% at 1.0643, the Aussie is down 1.81% at 0.7630, below the pre-Fed level. Sterling is down 1.66% at 1.4729 and the Canadian dollar is down 1.29% with USDCAD up to 1.2724. USDJPY is fairly quiet at 120.88. For the record HSBC reckons the US dollar rally is over and they are upgrading their forecasts.

– Stocks also reversed a little of their post-Fed enthusiasm with the Dow and S&P 500 down but the Nasdaq managed to rally. Stocks in Europe were mixed across the region but worth noting is that the Greece issue is still smoldering with another meeting overnight which Jeroen Dijsselbloem, head of the Eurogroup, said made little progress so far. “Time is ticking away, so we don’t have a lot of time. So we have really got to get to work,” Dijsselbloem said. I don’t know about you but this Greek thing is worrying me so much I was dreaming this morning that they unilaterally left the Euro and defaulted on their bonds. It’s a nightmare Euro bulls experienced with last night’s sharp reversal.

– One thing worth noting in the context of the fed and an increasing chance that rates don’t rise this year at all was the comment from BoE Chief Economist Andrew Haldane that the chances of a rate hike or rate cut are evenly balanced and that “policy may need to move off either foot in the immediate period ahead.”

Here’s the overnight scoreboard:

  • Dow Jones down 0.65% to 17,959
  • Nasdaq up 0.19% to 4,992
  • S&P down 0.49% to 2,089
  • London (FTSE 100) up 0.25% to 6,962
  • Frankfurt (DAX) down 0.2% to 11,899
  • Paris (CAC) up 0.07% to 5,037
  • Tokyo (Nikkei) down 0.35% to 19,476
  • Shanghai (Composite) up 0.15% to 3,582
  • Hong Kong (Hang Seng) up 1.45% to 24,468
  • ASX Futures (SPI June) down 14 points to 5,944
  • AUDUSD: 0.7643
  • EURUSD: 1.0658
  • USDJPY: 120.76
  • GBPUSD: 1.4738
  • USDCAD: 1.2716
  • Crude: $45.66
  • Gold: $1,171

– Markets in Asia were a little quieter than they might otherwise had been. But then again, Shanghai has been marching to the beat of its very own gun recently. The Hang Seng managed a big rally on the back of US moves but the Nikkei did not like the Yen’s rally.

– Locally the day looks set to be dominated with the reverberations from last night’s reversal of fortune. Futures are indicating a down day. After a big technical break yesterday of the recent trading range short term traders will be a little nervous.

– On commodities, crude oil was lower as well on both US dollar strength and comments from the Kuwait Oil Minister who said OPEC will stay the course and not cut production. Prices for April delivery fell 2.42% to $45.52. Interestingly, gold managed to resist the dollar holding at $1171 an ounce overnight. Copper is obviously a day behind as it rallied to $2.6595. On the bulks June iron ore was 11 cents higher at $53.36, while Newcastle coal fell $1.10 to $54.20.

On the data front today RBA Governor Stevens is talking at 1pm while the Canadian CPI is the only other major event on the calender.

And now from CMC Markets’ Ric Spooner is today’s Stock of the Day

Domino’s Pizza

It’s hard to knock the performance of this company. Earnings per share were up 37% in the last half yearly report. But it’s expensive, currently priced at around 40 times F16 earnings. Investors seem to be getting a bit nervous about this pricing and this is reflected in the chart which looks a chance of completing a bearish head and shoulder pattern.

The standard approach to head and shoulder patterns is to sell on a break below the “neck line”. The market has been flirting with this for a few days. Now that this has happened it may pay to wait for a clear move below the support just under the neck line before assuming the head and shoulder set up has been triggered.

Ric Spooner, chief market analyst, CMC Markets

You can follow Ric on Twitter @ricspooner_CMC

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