We haven't even started the year and the market is already posting some crazy volatility in a thin liquidity environment like the Asia session, and this is just the precursor of what may to come. As last year was we saw a perfect symmetry of volatility where in the first half of the year the volatility was pushing towards multiple all time low levels in the second part we saw a pick up in volatility (see Figure 1)
Figure 1. FX Volatility Deutsche Bank Currency Index

This pick up in volatility doesn't support the financial system stability, quite contrary it spells: RISK. Even the current policy divergence between major economies says higher volatility ahead, so trade accordingly.

Best Regards,
Daytrader21
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