While gold’s rally suggests there is no end to turmoil, forex traders need to start each day knowing where the China fixes.

The challenge is not to predict bottoms in the markets, but how long and how high it will go. Fresh cycle lows in Treasury yields and a sharp drop in equities turned around in wild trading on Wednesday. Markets bounced in the last hour of New York trading  and resumed into Thursday Asian and European hours when the Peoples Bank of China  fixed the yuan slightly stronger than was expected --despite having set the fixing below 7.00 for the first time since 2008. Gold also hit a six-year high above $1,500.

The market whimpered then roared Wednesday on a sharp turnaround in Treasury yields. Early in North American trade, U.S. 10-year Treasury yields hit a cycle low of 1.59% and 30-year Treasury yields hit 2.21%, only a few basis points from an all-time low (that was established with Fed funds at a much lower rate). That fear spilled into equity markets and the S&P 500 fell by as much as 56 points.

In addition to the PBOC fixing, comments from Evans also helped sentiment, which was a departure from Bullard's comments earlier in the week. Also helping sentiment is a U.S. report indicating that U.S.-China trade talks are still planned for September. A Chinese report cast some doubt on that but sentiment reversed and stocks and bonds recovered to finish the day largely unchanged.

The FX market moves played out on the same plane, but to a much smaller scale. USD/JPY fell 60 pips to 105.50 only to recoup the entire move. The Australian dollar was more impressive as it fell a full cent on the Bank of New Zealand’s cut but recovered virtually all the losses by the end of the day.

One asset that didn't turn around was gold. It hit a six-year high of $1,510 from an open of $1,475 and held most of the gains to finish above $1,500. That strength in risk-positive and risk-negative environments is telling.

Markets will likely revert to watching the CNY fixing at the start of every Asian session to get a read on Beijing's intentions and markets' reactions.