It is only the Australian dollar that is sitting higher than the US dollar in trading so far today. Traders adopted a more risk-on approach early on but we have seen equities pare most of that gains in European morning trade as flows are slowly trickling back in to start the new year.

USD/JPY is up 0.5% to 141.60 while USD/CHF is up 0.7% to 0.8473 currently. The former is still shying away from a test of the 140.00 mark while the latter looks to be holding above the 0.8400 level after attempted breaks below that in thin trading last week.

Meanwhile, EUR/USD is down 0.3% to retest the 1.1000 level while GBP/USD is down 0.2% to 1.2700 after some back and forth action with the high earlier touching 1.2760. It is only AUD/USD that is up 0.1% to 0.6818 but off earlier highs in Asia of 0.6839 on the day.

In other markets, gold is starting off January on a solid note with price up 0.6% to $2,075 while oil is also up 2.5% to $73.43 at the moment. In the bond market, yields are higher with 10-year Treasury yields up over 7 bps to 3.935%. It is but a small bump higher as the downtrend since November remains intact for the most part.

In the equities space, European stocks were off to the races at the open but have cooled a fair bit with the Eurostoxx now up just 0.2%, DAX up 0.5%, and CAC 40 up 0.2% on the day.

It is a time where traders are settling in and getting back their groove, with flows returning after the holiday period. So, be mindful of looking too much into the trends we’re seeing. As a side note, just be wary that we also do have US non-farm payrolls on Friday to work through this week.

This article was written by Justin Low at www.forexlive.com.