Here's A 10-Second Guide To What Traders Are Chatting About This Morning

Dave Lutz of Stifel Nicolaus passes along what traders are chatting about this morning.

Good Morning! Futures are unchanged, after being up as much as 50bp earlier — Wind coming out as the Yen continues to gather steam on Kuroda comments saying he will adjust policy if risks from easing materialise, and the € hit as ECB’s Coeure says “the ECB is very seriously considering negative deposit rates”. Many feel S&P futures will retest the 50dma, down about 50bp from here at 1803, as we have had the strongest 4day winning streak since late 2011/early 2012 for the Indices. EU markets remain strong, with Germany up 65bp, but volume remains below trend. EU FINs having a good day as Italian 10-year yields fell to the lowest in almost eight years. The FTSE is unchanged despite dovish talk from BOE’s Carney — as the UK braces for another massive storm. Over in Asia – Japan gained 60bp, tempered by a plunge in Machine Tool Orders, but that Yen has futures marked off almost 1.5% right now. Shanghai posted a 30bp gain — we had very Strong Chinese Trade data, but questions arise about its accuracy. Doesn’t matter, as it has propelled EM Stocks to the highest in 3 weeks.

The 10YY remains higher, but was rejected from the 100dma in early trading — we have a $US24B, 10Y auction at 1. As mentioned, the DXY is flying, as the $US gains sharply against €, breaking upside of the 100dma. Many traders are focused on heavy resistance against the Yen however — at the 102.70-102.8 in the $US¥ cross. With the stronger $US, commodities have a headwind — but Industrial metals like Copper and Platinum are well bid (China data) — while WTI is popping on API data showing heavy Cushing drawdowns (DOE data at 10:30 key). Brent is barely green, however, despite the strong Chinese imports of the commodity, as EU IP came in weaker than expected – We have the OPEC monthly report at some point today. Nat gas is popping another 2% (up 17% in the last week) on the tough US weather — Catalysts today include: The Senate Debt Vote as the GOP is urging their members for a “quick vote” today ahead of weather and a 2 week break — we have scheduled Bullard speaking at 8:45, NY Fed Small Business Credit Survey at 10, ECB President Draghi Speaks and DOE Data at 10:30, a small POMO at 11, the $US24B 10Y auction at 1, and the Monthly Budget Statement for January at 2.

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