EUR/USD had a great couple of sessions in Europe and New York after laying low all day in Asia yesterday:
The eurozone flash PMIs came in better (US data was a bit all over the place, though)
I read Jim’s great article overnight (The euro, reasons to be cheerful – 1,2, er…).
When I wrote a couple of days ago about my conversations with a few macro hedge funds, I mentioned that on the euro the message was that most were bearish on the political side, but remained reluctant to convert that thinking to short positions. Today is a graphic example of that.
(In short… PRO TIP: Price action contradicting the politics? Bet with the price action)
Where to today for the EUR/USD? (Oh, when I say today, I mean the Europe and American sessions. Asia is likely to do its thing and head sideways as usual … I really hope it doesn’t and I get my nose rubbed in it … we’ll see).
Some techs are arguing for a short-term top around 1.3700, saying, for example, that 1.37 is the 50% retrace of the 1.3890 to 1.3510 move. Also, some sellers are clustering ahead of and around 1.3700, some of it option-related (I’ll have the full EUR/UISD orderboard a little later).
Thoughts welcome here, or in the Trade ideas thread
EURUSD daily candlestick chart on 24 January 2014