Looks like we've finally got our stimulus! The question is: how is the market going to react on open? You can expect massive gaps for sure, but in which direction?
Given how the USD has performed over the last few weeks is unusual for those betting on reflation. The dollar has been rising despite the conventional economic argument that an increased in supply leads to a decrease in price. This has not been happening. It seems as if the market has been pricing in incredible amounts of bulls.
If the USD has acted this way, one can assume of a regime shift in the dollar. Risk-on could potentially now mean #USDBull, instead of the opposite - which was the overall theme throughout 2020.
If we expect Dollar bulls for next week, that means Gold bears. The market should have priced in 'reflation' by now.
Given how the USD has performed over the last few weeks is unusual for those betting on reflation. The dollar has been rising despite the conventional economic argument that an increased in supply leads to a decrease in price. This has not been happening. It seems as if the market has been pricing in incredible amounts of bulls.
If the USD has acted this way, one can assume of a regime shift in the dollar. Risk-on could potentially now mean #USDBull, instead of the opposite - which was the overall theme throughout 2020.
If we expect Dollar bulls for next week, that means Gold bears. The market should have priced in 'reflation' by now.