A strong day for equity markets caught the headlines yesterday, but we are not convinced that it was a game changer and we believe caution is still merited. Despite two days of buying, the Shanghai Composite is still locked in a well-defined downtrend and the S&P500 has not yet broken decisively higher. The consistent move so far this year is euro weakness; it is a broad-based trend and we expect it to continue. Overnight, EUR/CAD has broken lower and appears to be on course to revisit its 2011 low in Q1.
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