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Posts by "speculator"
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Posts by Anonymous "speculator":
June 21, 2009 16:22 ET In Thread: Where will EURUSD close by end of June? (Poll)
it is in the interest of the world for a strong dollar to help both exporters and longer term interest rates down. I can't see the dollar going down against the euro beyond 1.45 as too many issues with europe. Although speculators net long of euro.
its partly elliot wave theory really. but not just that. not long ago the dollar was bearish at record (oct-nov) levels and i am a true believer of contrarian theories as i studied these trends at cass business school. if you remember just a couple of weeks ago, even jim rogers anounced he is going long dollar now because everyone is so bearish on it. when there are very few left to make into dollar bears..the market can only go one way.
there were many days where i said 75 is a very key level and a break below could indicate further falls but that this should be the bottom.
but, my liquidity story was my own projection and i have not read that anywhere. i did see back in september that the dollar should rise rapidly during nov/dec which would coincide with the fed reducing liquidity and tightening would come much earlier than most saw. the clues came with credible threats from usa and rest of the world that they also want a strong dollar.
i mentioned that fed will rally sharply when fed annouce liquidity cutbacks towards end of november and that they would not extent as they reach their reflating objectives and ensured that the financial system was back in order.
I also mentioned that DXY was about to bottom at approx 75 and it bottomed slighly less. but some question this recent rally and think it is just shortlived because of duba, greece etc and profit taking. but in my opinion its a start of a new trend which will reverse much of the DXY's multi-month decline.
The theme of next year will less positive than the second half of this year as investors will now fear a hike in rates. This will put downwards pressure in gold demand and all risky assets in particular gold and oil.
The dollar carry trade is also huge and will certainly impact stocks in the first quarter of next year as a minimum.
Soverign credit worthiness will certainly influence the dollar and eurolandproblems will keep benefiting the dollar as there are very few major currencies that can take the liquidy of money markets apart from the yen after the euro but that isnt a reserve currency.
sterling is also overpriced by about 7% on many levels. the credit ratings of the uk will also be tarnished in 2010 which will send sterling down BIG time against dollar in particular.