Saxo's John Hardy discusses what the drivers are behind the risk-off sentiment that's been dominating the markets over the last 24 hours. On the one hand he looks at Glencore and the risk to the commodity market in general. On the other, he examines the crisis in emerging markets and in particular Brazil.

Regardless of what's sparked the risk-off appetite, Hardy says the correlations are moving to one across markets.

It means that both the euro and the Japanese yen are up  while the US dollar and sterling are holding the middle ground. It's commodity currencies that are at their weakest, notes John. 

For that reason, he has entered a #SaxoStrats trade this Tuesday in which he's shorted USDJPY. He warns that it is still stuck in a range and the trade could be stopped out if there is an improvement in risk sentiment. 

You can read more about John's USDJPY #SaxoStrats trade here.