Not Much of Interest, Except....

The overnight session was rather uneventful as you can see in the open, we are seeing a little typical opening volatility, but not much there even.

There was a slight move to the downside overnight in the EUR/USD, if you recall what I talked about as a key catalyst or potential catalyst this week, it's the ECB rate meeting tomorrow. While the Euro did drop a bit, it's off the week's lows so it wasn't that big of a drop, but I noticed right around the time Europe opened a little extra downside pressure which I believe coincided with an ECB member stating that they were not "Targeting currency rates", this seems like an odd thing to say the day before a potential rate change that could send the Euro down, it's almost as if it was a statement to deflect any criticism of rate targeting (currency) before hand and why would one need to do such unless?

Around that time the EUR/USD saw a little more downside momentum.

You have to understand how leveraged these currency carry trades are (up to 200 to 1), so any move in the EUR or USD (which are two, or really one of the larger carry trade pairs) could be devastating to the carry trade which would ripple throughout the market a it is unwound, lest these firms need to come up with significant extra margin, which would still effect the stock market.

So we'll watch for signs of the carry trade pairs being unwound.

Other than that, Silvio Berlusconi has narrowed the margin in the upcoming Italian elections to within the margin of error, which would mean the end of the Goldman, Technocratic rule over Italy if not the EU more generally, a major change for policy direction in the EU as Goldman's hands behind the wheel would suddenly lose grip in a key member nation.

For now, it's collecting initial data and looking for those opportunities which could present themselves very quickly, especially in front of tomorrow's ECB meeting.