If you make the news rounds every morning like I do, visiting the handful of commonly skeptical armageddon theorists that write on a daily basis, you'll notice a lot of hoopla over how risk appetite was supposed to vanish in an instant flash today.
From my angle, it's just too early. Stagnation? Yes. Utter chaos? That takes some stimulus.
There are signs of clear discontent like the one posted below (Merkel and Sarkozy are asked about Italy) between EU leaders over the weekend, with one story after another claiming that zero is getting accomplished, and at a rapid rate. Why so many were focused on disaster yesterday (the possibility of occurrence today), I have no idea, but this is certainly the case. Merkel herself claimed that nothing was going to happen until later this week.
Being a skeptic is one thing, but to take it to the extreme, and all the time, is outright unhealthy. It's very entertaining, no doubt, but for a trader, you have to tread more carefully. Nothing has yet to happen other than consolidation or continuation of an uptrend because of just that: nothing has happened as far as these meetings are concerned, and more importantly, a deadline which was clearly stated over the wires this weekend has not been hit yet.
Blame risk appetite on whatever you will, Europe is in the spotlight right now.
I reference Reuters all of the time because in terms of just base, bottom line vanilla news, they are about as close as I feel I can get to it these days. Downtime is reserved for the armageddon theories and questioning conventional thinking. Today's rallies in Asian markets and stagnation among currencies seems all too normal. This is just one of many cases where being a reckless skeptic can be just as disastrous as thinking that pure data moves any market.
Don't be a victim of “oh, these dang funny markets just do as they please”.
US markets are currently tailing Asia's lead today, up anywhere from a half to just under a percent, with EUR/USD locked in consolidation (bounced off of a semi-spike base). Gold: +1.14%, WTI: +2.11%. For the short term, risk hasn't been shot down yet, though my opinions haven't changed since yesterday in regards to current levels of resistance close at hand.
