All this noise is happening just as the U.S. Dollar sits right at the point of technical resistance, and soon after the U.S. equity market got caught in a pronounced downdraft yesterday about 2 pm.

As suddenly as the speculation of yuan revaluation hit the European markets, the equity indexes, which had been extremely weak right at the open, took off like a rocket, presumably on beliefs that the USD would rapidly decline, making European assets relatively more valuable (???).

The currency markets are now totally rattled. Strength or weakness at this moment is likely to reverse in a few minutes. Emotions are on a bit of a roller-coaster.

The China report is likely completely over-blown speculation. In any event, the USD is otherwise weak against the Euro, Pound and Yen " based on fears of a bad U.S. March trade deficit number today.

The oil price surge in March is expected to push the U.S. trade deficit higher or at least keep it on its negative track.

The skinny is that the capital market this early morning is the wackiest I have seen for several months. Today will be a good one to be especially vigilant for rumors, dekes and head fakes. I expect gold to get into play today as well.