[Dan]

The correlation of the USD to oil, stocks, bonds continues to be the story as many are beginning to think that FX leads rather than follows those other markets. The Oil market is consolidating but the EUR is higher; equity markets were mostly sideways overnight but the USD is weaker – with JPY back in play; the bond market is bid but the USD is weaker. All things being equal we are in a choppy trend with 1.4250 EUR break early leading to 1.43 and 1.45 targets for trend followers. The news on the day is unlikely to derail a trend as the market is going to listen to officials and watch vehicle sales. The US bounce in ISM was impressive with the new orders subcomponent key. But today isn’t about drivers of FX but the USD itself as technicals run amok.