Market getting very nervous ahead of Wednesday’s FOMC
I’m surprised by the big over-reactions we are seeing to any comments whatsoever regarding the Fed meeting tomorrow. The FT article caused a massive flurry of activity, and this was only one man’s opinion, so obviously the market is not comfortable with its overall positioning. We saw a big macro fund dumping much of its positions last week and as any good trader will tell you, if you don’t quite understand what’s happening then its time to get out.
The FX market is playing a secondary role, reacting to what happens elsewhere, and that’s also how I plan to trade this market, reacting to developments rather than predicting them.
Today’s main event during the Asian session will be the release of the RBA meeting minutes from last month.