What are traders watching this morning? The countdown to the Fed ...

Via Dave Lutz at JonesTrading, here’s what traders are talking about this morning.

Good Morning, and Happy Fed Day! Decision (No Change expected) and “dot plot” comes at 2pm – all expectations are for Janet Yellen to lay the groundwork for a September hike in her press conference at 2:30 today. While US Futures are in the green, Euro markets remain tense as we await the ECB’s decision whether to raise the funding level of Emergency Liquidity Assistance for Greek banks and/or increasing haircuts on Greek collateral. The DAX has slipped red as Consumer and Financials retreat — While Athens is showing a nice rally after being smooshed the last week. Over in China, A strong rally in the afternoon session offset Margin/IPO concerns, and left Shanghai almost 2% higher – Nikkei fell for a 3rd straight session on disappointing Trade Figures – Aussie jumped 1.1% as investors dove into Financials, which have been crushed of late. The KOSPI managed a small gain as MERS concerns continue.

The US 10YY is basically flat after breaking towards 2.3% in the overnight, while a decent bid drives Bund yields into the red. Greek debt has a slight bid to it (as do all peripheries) — helping the Euro eek out a small gain against the $US. The cross to watch tho is the Yen — as $US/Yen surges toward 124 — creating a nice tailwind for global equities. With the DXY weaker (but rallying quick), we have a tailwind for commodities — led by the Oil complex, as last night’s API data showed a large draw ahead of DOE today. The Softs are jumping, led by a 1.7% pop in Wheat (Ukraine?), while the metals meander around unch. All the major scheduled catalysts today are coming out of Washington — at 10am, Treasury’s Lew testifies on FSO, and Defence Sec. Ashton Carter, Chairman of Joint Chiefs of Staff Gen. Martin Dempsey testify on Middle East strategy; we get the DOE data for Crude posts at 10:30 — then the spotlight falls to the FOMC announcement at 2, followed by Janet singing solo at 2:30.

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