While AU looks extended, that does not mean we will get a dip to buy.
The evidence that inflation Is slowing Is mostly circumstantial.
Maybe this was a true mania that has gone bust. We will see how history judges it.
It takes more than just a day's bounce to call it a trend.
A flush of FX outflows threatens a breach of the 7 level vs. the dollar, and commodities will likely follow suit.
The biggest risk right now is the yuan level versus the dollar.
After recent liquidation, it seems the risk-reward is on the downside for the dollar and U.S. bonds.
Here's the play as China's yuan approaches trading at seven yuan to the U.S. dollar.
The Chinese central bank is moving to boost asset prices and offset trade war and slowdown fears.
From beaten-down currencies to U.S. Treasurys, it's always valuable to assess the prospects of various asset classes.