European Open - 17.12.2015

The Fed delivered and met market expectations. Volatility was low, moves were contained (mostly). The US economy is doing fine, and there is room for gradual data dependant hikes. The long-USD trade is still in play but the bandwagon is getting stuffed. So be cautious, especially into year-end where position-squaring and window dressing can generate erratic moves.

Asian equities gave back some of the post-FOMC gains but remain supported. The general tone from FOMC was risk-positive, and Vix shot back down. For now, complacency is kicking in. European equities actually look better than US or Asian counterparts.

NZD GDP beat expectations but the market sold Kiwi after the release. This likely reflects several factors: expectations had been for a pick-up, the release came shortly after the Fed decision and liquidity is vanishing. So Kiwi may not be a good buy today, but it's still one of the best performers out there.

Looking forward:  attention today will be on UK retail sales (where the probability of a surprize is high) and  German IFO ( ZEW and PMIs surveys already released this week pointed to a solid end to 2015 and today’s survey should confirm).

Charts for today: UsdCad longs still look good to me.