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by Ashraf Laidi
Posted: Jun 11, 2010 19:19
Comments: 43
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This thread was started in response to the Article:

Eurozone Core, USD Index & Swiss Knife

Watch the risk of contacgion into Eurozone core nations, as well as the USD Index monthly rise and the broadening gains in the Swiss franc.
 
catnip
Frankfurt, Germany
Posted Anonymously
12 years ago
Jun 12, 2010 12:45
I am a trader not an investor. In the long run we are all dead.
montmorency
Abingdon, UK
Posts: 610
12 years ago
Jun 12, 2010 12:06
False breaks, or just "normal" retracements to a long downtrend?
If we look at, say, a daily chart since around January, long-term shorting EUR/USD looks like a no-brainer. However, at the time, with lots of false-breaks or retracements, it was nothing like so easy, despite Ashraf telling us back then it was probably going down to 1.32. 1.32 now seems like a distant memory :-) Have the fundamentals really changed since those days? If anything, things have got worse for the Euro. So I think we should not be surprised how far down it can go, but equally, we should never be surprised how far back up it can bounce (before finally resuming it downward spiral).

catnip
Frankfurt, Germany
Posted Anonymously
12 years ago
Jun 12, 2010 10:36
As liquidity runs dry there has to be a bull trap in stocks . We will see highs in S&P DIJA at or above YTD highs and with that EUR will go up. If no fresh cash is made by selloff of overpriced stocks we will see a big crash pretty soon. However this will occur after the bull trap and very sharp. But for now expect S&P above 1100 DIJA close to 11000 and EURUSD reaching 1.30.
That has nothing to do with fundamentals of markets only with liquidity crunch.
When both liquidity and capital is low, technical analysis , elliot waves etc. regularly fail.
Merchant
Posted Anonymously
12 years ago
Jun 12, 2010 9:14
houram,

May I contribute. The euro never retraced beyond its previous highs since Dec 09. Not expecting it to go to 1.30.
Merchant
Posted Anonymously
12 years ago
Jun 12, 2010 9:11
Hi Ashraf and all,

Euro must fall below what value (other than its previous low around 1.18 something) to signal the next leg down is beginning ? There are false breaks to the north as mentioned by others, but there are also false breaks to the south as on Friday.

Also, better to short it against the USD or the yen ? If risk aversion to return, the yen is bound to rise and the euro may move more with the yen ?
Xaron
Munich, Germany
Posts: 528
12 years ago
Jun 12, 2010 8:22
Thanks for clarifying, Ashraf! :)
houram
Vancouver, Canada
Posts: 55
12 years ago
Jun 12, 2010 3:31
In my view we could see EUR/USD way below 1.10 towards parity but before that I think we will see some consolidation towards 1.30 and above. Also equities are heading south but not any time soon. This market is so erratic that it will shake out the short positions until most of us turn bullish again. Same goes for Euro.
Ashraf Laidi
London, UK
Posts: 0
12 years ago
Jun 12, 2010 1:17
A close at 1.21 or 1.2110 is not good enough. This may be a false break. If youve traded in this market as little as 3 or 4 months youd have seen your share of false breaks.

EURUSD did have a false break back in April 11-13 before succumbing back into the downtrend.

Id have to see a proper close above 1.2130-40 in Asia. No, it is not called "moving the goal posts"

Ashraf
Alex_B
Canada
Posts: 6
12 years ago
Jun 12, 2010 0:14
It closed barely above 1.21. The rise happened during last 15 minutes of trading. It leaves us with lots of questions, as always.
But it's unlikely, that euro will go north any further than it did already.
The main question is equity markets. They are about to crash big time. Will PPT manage to hold them at these levels? if yes, then there is the chance that euro will stabilize.
Xaron
Munich, Germany
Posts: 528
12 years ago
Jun 11, 2010 22:05
Alright. Friday close at 1.2112 if I'm not mistaken. So what now?