European Open: Safe havens rise on (dubious) reports of military action

A Russian- backed news agency reported that Ukraine’s forces opened fire in Donbas, transferring safe- havens advanced and equity futures lower. Requests turned lower.
Safe havens are advanced following reports from Russia’s state- backed media that Ukrainian forces fired mortar shells and grenades on the Donbas region of Ukraine.

But it’s doubtful to be the report itself which has moved requests. Against the background of former intelligence reports that Russia was anticipated to fabricate reasons to attack Ukraine, the report could simply be such a tool which lays the root to foray. Classic threat-off moves replaced late it he Asian session with equity indicator futures lower, gold and the yearning advanced. Dealers are now staying for any follow-through to see how this escalates.

The follow-up on this report from Russia or Ukraine is likely to be the crucial motorist for sentiment moment. For illustration, movements from the Russian service which suggest medication for retribution could weigh heavily on request sentiment. Or if Ukraine will deny the reports ( relatively likely) and Russia don’t beat their war barrel, we could see earlier losses could snappily dematerialize and dealers could direct on profitable date.

AUD/ JPY is a go-to brace to cover threat appetite for currency dealers. It fell around 100 pips after the report was released and may have verified a rout of a rising wedge pattern. The pattern projects a target around the base (81.53) although support resides around82.30 and81.87. Prices are presently retracing against the original leg lower as dealers stay to see how the said reports play out. But for now we’re keen to see if instigation turns lower once further, whilst prices remains beneath the83.20 –83.34 resistance zone.

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