Another wild day on Wall Street ended with an impressive rebound in stock markets but a concerning dip in consumer confidence. It was the biggest intraday market gain since 2010. The FX market had a more risk-averse takeaway with the Swiss franc leading and Australian dollar lagging. US trade balance is the data point to watch on Friday.

The rollercoaster in US equity markets at what’s usually a quiet time of year continued on Thursday. The S&P 500 fell by nearly 3% late in the day then stormed back to close nearly 1% higher. Importantly, Thursday was the final day to settle US equity trades before year-end, meaning that anyone selling for tax reasons needed to do so Thursday. That paradigm may have signaled the ‘all clear’ for dip buyers, at least for the moment. A hint came earlier in the day as European equities had a late surge to pare losses.

While this was a second small victory for the bulls, there are some fresh concerns about the economy. December consumer confidence fell to 128.1 from 135.7. the consensus was for a dip to 133.7. It’s the second data point this week (following the Richmond Fed) that’s badly missed estimates.

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Still, the picture remains mostly positive in the hard data with initial jobless claims and the FHFA both matching estimates Thursday.

One number to watch on Friday is the US November advance goods trade balance report due at 1330 GMT. The consensus is for a $76.0B deficit and economists are rarely more than $3 billion off the mark but this is an unusual time as tariffs hit. A miss would raise fresh questions about the impact of the trade war.

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Ashraf Laidi is an independent strategist and trader, founder of Intermarket Strategy Ltd and author of "Currency Trading & Intermarket Analysis". He is the former chief global strategist at City Index / FX Solutions, where he focused on foreign exchange and global macro developments pertaining to central bank policies, sovereign debt and intermarket dynamics. Ashraf had also served as Chief Strategist at CMC Markets, where he headed a global team of analysts and led seminars and trainings in four continents. His insights on currencies and commodities won him several #1 rankings with FXWeek and Reuters. Prior to CMC Markets, Laidi monitored the performance of a multi-FX portfolio at the United Nations, assessed sovereign and project investment risk with Hagler Bailly and the World Bank, and analyzed emerging market bonds at Reuters. Laidi also created the first 24-hour currency web site for traders and researchers alike on the eve of the creation of the euro. Laidi's analysis of currency markets stand out based on his distinct style in bridging the fundamental and technical aspects of the markets. Laidi regularly appears on CNBC TV (US, Europe, Arabia and Asia/Pacific), Bloomberg TV (US, Asia/Pacific, France and Spain), BNN, PBSs Nightly Business Report, and BBC. His insights also appear in the Financial Times, the Wall Street Journal and Barrons. He has given numerous interviews and lectures in Arabic, French, and to audiences spanning from Canada, Central America and Asia/Pacific.


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