Contrasting PMI's, live trade.

Positive PMI's from Europe, the UK and Australia contrast (for the first time in a while) with data from the US. As lower than expected PMI, particularly service PMI show a slight chink the the US armour. And any talk of another rate hike from the FED is put on hold. Stocks are up, the US 10year is down and the VIX continues to drop.

Today's data makes the upcoming PCE number very interesting, we already know the markets eagerness to price in cuts from the FED and a 'soft number' could see the recent USD strength reverse.

For now, I'm content to keep with the strategy of trading hawkish central banks Vs dovish central banks. And today's environment offers another 'risk on, interest rate differential trade'

Which gives the option of AUD NZD or possibly GBP long (given Bailey's comments today)

Vs JPY or CHF short.

Personally, I've entered another AUD CHF long.

So far, earnings season has crept under the radar, but any negative report is the risk to the trade. Or of course, any fresh negativity regarding the Middle East.

Email photo to follow: