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Risk sentiment on the defensive could be what takes whole of the broader market this week but the pullback in equities so far isn’t amounting to a great deal of fear just yet.
That said, the rout in crypto is certainly looking ugly and while it isn’t quite having spillovers, it isn’t helping with general sentiment at the moment either.
US futures are on the defensive but equity investors are slowly getting used to the back and forth by now as conditions become more volatile amid inflation talk.
So far, the Fed is steering clear of any hints that it will take seriously the latest string of economic data so perhaps that will provide comfort to investors that easy money will continue to stay on for quite some time yet.
Looking at FX, the euro continues to look perky on a break above 1.2200 while GBP/USD is still trying to secure a firm daily break above 1.4200 currently.
CAD/JPY is still among the pairs I’d favour scaling in longs on any pullbacks should the market stick to the inflation narrative in the long-term.
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