I'm pretty sure you know what my general expectations for today have been as we move in to another op-ex Friday (like every Friday). I've been expecting the lateral action of the "Pre-minutes" market to form a base wide enough, yet still small enough to create a short duration corrective bounce, but after yesterday's minutes we needed either some market capitulation which we didn't get yesterday as the Dominant Price/Volume Relationship showed last night, short of that, bad news will do and we did get that. The other trick is a Yen smack down and we got that too, it worked once bout a week and a half ago then failed to work last week.
Bad news came in the form of Chinese Flash PMI and Eurozone Composite Flash PMI, both of which missed and declined.
The Yen was knocked lower about 100 pips sending yen based carry crosses higher with futures. The USD./JPY lifted over 100.90 and the Nikkei surged by 2%.
"I showed late in the day how the averages suddenly started to improve, they have some work, but perhaps some late night Yen slam or EUR/JPY carry lifts the market"
Sure enough, there's the 1 a.m. Yen slam and below...
So it turns out that between the Yen (obvious manipulation if I can tell you what it will be and when hours before) and the PMI bad news, the market may have enough ammo to make that move that we have been looking for as Tuesday gave us a rounding bottom.
We also have some eco data on the docket today, the Senate Banking Committee is set to vote on the nomination of Yellen as F_E_D chair and we have 3 F_E_D speakers today for good measure.
So far futures are higher.
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