Weekly review.

During the week starting Monday 4 December, I maintained my soft landing bias and the data still backs up that narrative. Although it was a difficult trading week, due to a breakdown in the stocks, bonds and currencies correlations. Stocks and bonds towed the line, with bond yields lower and stocks hitting new yearly highs. But the currencies marched to a different beat this week. With the dollar and yen particularly strong, which goes against the 'risk on soft landing' trade. There wasn't much written about the breakdown in correlation , personally I put it down to Moody's downgrade of China having an effect on the 'risk on' currencies. Combined with a realisation that the market was perhaps over zealous in pricing on rate cuts from the US next year. And finally, BOJ governor Ueda, speaking about JPY policy normalisation. Which significantly strengthened the yen and makes December's BOJ meeting very interesting.

The week rounded up with an action packed Friday, firstly, a very good all round NFP print gave the USD strength, only for softer consumer inflation expectations and positive consumer sentiment, make the market have second thoughts about dollar strength. Which goes to show how sensitive the market is to any inflation news if it can make the price action over power NFP.

moving into next week, I'll start by maintaing my soft landing bias but I'll be watching the price action closely, and of course, there is the small matter of CPI and an FOMC meeting to contend with.

On a personal level it was a disapointing week with three trades, one loss and two break even. But that's ok, losing weeks happen. But it's important to stay disciplined and focus on making 'good decisions'

Trade 1: NZD USD -1

Trade 2: NZD USD 0

Trade 3: EUR USD -0.2

Total: -1.2%

Results since start of blog 6 months ago = +17.5%