As noted earlier today, when we lamented that DE Shaw's correlation algos had switched from the AUD carry pair to the EURUSD as the funding currency pair of choice, moments ago the blast off by the USDJPY to over 100 for the first time since June 5 did absolutely nothing to help ES which in fact has tumbled for the simple reason that as the USDJPY goes up, so the EURUSD go lower. Of course, all those who read our prediction yesterday following the latest Tom Stolper note, would be quite a bit richer right now.
"Trading FX without a Tom Stolper reco to fade is complicated: there is always the risk of losing money. Luckily, that risk is now gone and for all those unsure which pair to short, the man with the 0.001 batting average has just come out with his latest piece of muppet-slaying "research", according to which it is now time to go long the EURUSD, with a 1.35 target and a 1.28 stop loss. You know what to do."
Thanks for the 60 pips, and counting, Tom - we can always rely on you. Expect the 1.3000 support to be broken any second now.
End result, as the USDJPY is soaring alongside the 10Y yield, while the EURUSD is tumbling and so are stock futures.
and precious metals are in morning smackdown mode as the USD surges...