A.M. Update

Good Morning,

So far the futures and market indications are exactly what we saw building yesterday, losing the negative USD/JPY tine and threatening to move laterally, which is all that really needed to happen with some slight support from some other levers like HYG, VXX relative performance falling off a bit, TLT/30 year Treasuries, etc.

I don't see anything other than the gap up that they'll produce, in the Index futures, they are in line. What's important for today as has been the last several days and years is the USD/JPY, especially with bonds closing at 2 p.m. today rather than 3, which will mean USD/JPY will have more influence and with several European markets closed like Germany, Switzerland, Italy and the Nordic Countries with some potential algo European close confusion with London closing at 12:30 local and NYSE's Euronext cash market 35 mins after.

I don't see any imminent threat in $USDX, not like what it could have built once going lateral. There are some areas of strength in the Yen starting to show up.

I'll post the charts next, but this is about what we expected yesterday for today, at least thus far, how the two currencies proceed and any other developments in other levers like HYG will guide the rest of the day.

As I mentioned, the Yen/Gold pairs trade is on and Gold was down overnight with the Yen so we'll be looking at that closer.

Charts on the way...