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Talking Points:

• A retreat in volatility readings subdued the calls and fears of larger bear trends and return of momentum

• Speculation is still showing a tempered appetite for leveraging behind the 'status quo' risk trade

• Rate speculation will once again take the yoke on pairs like EURUSD and GBPUSD

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The revival of volatility levels - and thereby the return of trend and momentum through deleveraging - was curbed this past week. Yet, the market is not sliding back into the comfort of complacency so easily. Risk trends will be at the top of the list for fundamental concerns moving forward as volatility readings maintain their trend of slow recovery and speculators display reticence to re-enter the high risk / high leverage trades. Meanwhile, interest rate speculation will be actively shaped for the Dollar, Euro and Pound. While both EURUSD and GBPUSD are likely to see sharp technical moves, one is more likely to develop a trend from it. We discuss the top trading themes for the week ahead in the weekend Trading Video.

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