Today is the big test – time to see if we can guess with any accuracy the US Nonfarm Payrolls number and then predict the market’s reaction to said number. Luckily it’s multiple choice ... so there’s a chance we get it right.
Well, it really never fails. Perhaps we should contact the US Treasury to secure an appearance calendar for the man.
The man being US Treasury Secretary Timothy Geithner.
When he speaks, the dollar listens – it listens to the wind rushing by as the speed of its descent grows faster. When Geithner comes out and says something notable, and in that instance if the US dollar does not react poorly, you’ll know it’s safe to get long the buck.
“Most of the time wrong, but never in doubt” should be the motto for central bankers everywhere. But, being as highly educated as they are, and having as little real-world experience as they do, they never seem to let the facts get in the way of their equations which “oh so” precisely seem to fit their mandates. Problem is: either their mandates are wrong or they need to refigure their equations.
The currency wars began a while ago—the financial press is now catching on as a theme fit to print. As we all know, China is at the center of this war and the primary aggressor.
Though undeclared still, with lots of covert activity, much is becoming clear. Even Europe is stepping up to the plate to criticize China. Eurozone officials followed through on yesterday’s report that they would pressure China to free up the yuan so as to reduce “competitive” pressure on American and European businesses.
Leading off today is none other than the Commitment of Traders report; we mentioned this in our weekly audio/visual summary provided to our Currency Currents Professional members on Friday. Not surprisingly it showed a net short position on the US dollar greater than any time since mid-2008. The biggest reason for the move was the change in euro positioning.
