JPMorgan Analyst's Review of Markets - FJElite

I am finding this market tricky to read here and whilst plenty ol issues seemingly we have reached a reasonable level of pessimism. I have no real edge on whether tech stocks have seen the bottom but whilst energy prices remain high there is seemingly some movement on the negotiation front, but into the Midterms I just don't feel massively comfortable trusting much.

The Greenback moving a touch higher yesterday, confidence data and labour market differential within were strong. Fed tonight where Warsh “should" have to sound hawkish given the recent inflation readings (not exactly new news!) and month end corporate dollar demand were explanations banded around. I do think the flow argument is pervasive so will be interesting if continues at the back end of the week. On the Fed. with the first of Warsh's task forces presenting next month I don't see him sounding extreme in his hawkishness and maybe the most market moving factor will be how many dissents there might be if the decision is in fact on hold.

Plenty going on elsewhere from today, BOC will be interesting given the read through from the surprise hold from the RBNZ meeting last night but personally don't see them backing off, the UK budget where the market will be squinting for signs of negativity given the recent sterling outperformance but if can navigate a smooth enough path likely a green light for continuation, all before the ECB tomorrow and BOJ on Friday.

Crosses have helped to cushion the blow of the yen's inability to hold against the dollar, last night the turn of the kiwi leg! I didn't expect a hold but will take the W and squared up especially with the upcoming election more of a hit and run, having taken euros back yesterday just leaves me short usdjpy again at better levels and with offers galore on a 158 handle before happy to keep in that form for now (don't expect much from BOJ but should be some hawkish elements, GPIF news on the 6th November no key and if nothing from that promise will take it off the screen for the rest of the year!).