Anxiety mounts – North American session Market wrap for February 19

Log in to today's North American session Market wrap for February 19

Today marked another bizarre session in Markets, with Oil exploding to new highs without a broader risk-off move.

It seems that positioning for this weekend's action is amassing around the Energy commodity, which is weighing on the Stock Markets, with most global Indices red on the session.

European Equities have led to the downside after a couple of weeks of them outperforming their peers, which is now leading to a slight turn in sentiment. In the US, the Dow closed at the bottom but the correction was modest (-0.56%)

For once, Oil did not selloff to President Trump's announcement that "Good talks are being had [with Iran]", which points to a Market that confirms its anxiety.

Yet, if things were so scary, US Treasuries would be trading higher and Equities much lower. So overall, it still provides either opportunity or further confusion.

Participants are turning to local interests to mitigate their risk as the weekend closure approaches, which could signal further volatility tomorrow.

The US Dollar is shining bright this week and could be the one asset to watch in the coming times. As asset managers turn the most bearish in 12 years on the Reserve Currency, technical developments signals upcoming FX volatility.

Get ready for some heavy action tomorrow. And keep track of any headlines regarding US-Iran discussions.

Read More:

• USD/CHF carves a bottom after reaching 14-year lows – FX Outlook
• The costs of hesitation – Dow Jones and US Index Outlook
• Oil rallies as War Premium returns: WTI retests end-January $66 highs

The Heatmap in today's US Stock Market action confirms how unsure recent trading has been.

Most large-cap stocks are trading unchanged on the session, and except for a few HALO performers, the action remains muted, while the Indices turn slightly lower. Tomorrow could be huge for Stocks so stay close to the action.

Today's broad Market action saw volatility once again contained as hesitancy reigns.

Only Oil seems to know what it's doing, and to be quite frank, it could be showing quite misleading signs as it trapped to the downside a few times in the past weeks already.

With odds for an attack on Iran before end February still at around 30% (from Polymarket), it would be interesting to see if the prediction-based pricing is lagging a real possibility of an attack this weekend.

Still, I expect a US intervention in Iran to come in the near future (and have been spamming on the issue throughout the past month-and-half) so if it closes at its highs tomorrow without retracing, WTI bulls would be confirmed to be holding tight on their convictions.

The drop in the Australian Unemployment Rate pulled the Antipodean currencies higher in a low volatility FX Session.

With the Swissie now at the bottom of Major performance once again, it looks to be a new weakening trend for the CHF could be forming as it reaches all-time highs against the Euro. Mean reversion ahead? Check out our recent USD/CHF analysis to learn more.

The next 24 hours are about to be full of action for traders wherever they are located.

Expect lots of action in the NZD and the AUD in a short-time, and get ready for even more during the overnight/Friday session.

I invite you to check out our Calendar to learn more.

Safe Trades!

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