Good morning traders,

A few important things happening this morning:

Europe is strong at +1.3% (2 standard devs).  UK is much stronger and is up 3.2% (4.5 standard devs) on followthrough from very hot manufacturing data.  We are also seeing corresponding moves in Cable and Euro compared to Pacific currencies (GBPAUD +2%, etc).

Chile is intervening with a 12B FX operation to bring down the value of the Peso.  The Chilean stock market is currently down 4%, 5 standard deviations, which is an extremely significant (move even though the holiday season has inflated these standard deviations slightly.)   Many of our readers focus on daytrading US equities and might ask why they should care, but there is an important lesson on international interconnectedness here — Chile is a nearly pure play on Copper, and this intervention has the potential to adjust the value of Copper downward significantly…

… with possible carryover to the precious metals complex, which is already vulnerable to a break.  As I write this, US Silver futures are down -3%, Gold -2.2% and Platinum -1.5%.  Pay attention to the precious metals today guys… today could be the day.

The net impact of all of the overnight currency moves (some of which are quite significant) on the USD has, so far, been relatively small.

In other commodity related news, Crude Oil should be on everyone’s radar.  We are seeing a small overnight divergence in London’s Brent crude, which is stronger than our domestic WTI benchmark.  Regardless, Crude may be a focus over the next few weeks.

Today, be aware of the FOMC minutes released at 2:00 and Factory orders at 10:00.  I would suggest focusing some attention on Materials stocks today, which are likely to be in play.  Good trading everyone.