Trading Video: Equity Recovery Fails, Central Banks Shake Up FX Markets

Talking Points:

• Volatility continues to build with a wild S&P 500 day, but conviction in risk aversion still lacking

• The Euro was top billing with its second T-LTRO details, but stimulus may not be its key concern ahead

• Positions by the SNB, RBA, RBNZ and BoC show other central banks won't sit idly by as the rules change

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The S&P 500 failed spectacularly to forge a recovery this past session, and the result was more financial market volatility. Between a falter in the beacon for complacency, the rise in various asset classes' volatility measures and troubled foundation for positioning; some are ready to call a true 'risk aversion' weather front has descended on the market. Yet, even if sentiment does swing to the bears, will it compensate for a seasonal drain on liquidity to generate momentum? Meanwhile, the monetary policy wars (few will admit to currency wars) continues to heat up. The ECB's second Targeted-LTRO program drew tepid interest - reinforcing speculation that a bigger stimulus effort is necessary. As the biggest central banks leverage their influence, smaller players - the SNB, BoC, RBA and RBNZ - are being forced to take steps of their own. We discuss the top market-moving themes and top movers in today's Trading Video.

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