"The fundamental problem with financial markets is that they have - at least temporarily - broken almost totally free of the underlying economies.
I don't mean that they are diverging from the trends - what I am asserting is that they have literally lifted up and floated off. They are hovering someplace in space. As traders, we now react almost exclusively to our perceptions of what other market participants are doing/thinking. Flows of funds, positioning, risk-tolerance, technicals.
The high-frequency economic releases could as well be produced by a random numbers generator - the proverbial roll of the dice which adds some new inputs into the game, but devoid of any fundamental significance. The upcoming NFP is going to add a huge dose of volatility if it comes in above/below expectations, even though we are effectively talking about a few tens of thousands of jobs in an economy of nearly one-hundred million...the proverbial drop in the ocean.
Full of sound and fury - signifying nothing!"
Joanna