Last 2 weeks worked out well, with my bearish USD bias, but now I am looking towards longs again. Look at EU…2 weeks ago, when it looked super bearish below 1750, all analysts were bearish, retail was super bearish…and then every little jump up, people were selling. 1840 was shorted heavily, 1900 even heavier…and now? We are at a possible triple top at 1980 and people seem to be buying. Can you believe that? Selling the lows and buying the tops is a neverending retail story, it seems. I am not saying we can’t break 2000…and if we do, it will most likely go towards 2100, but the chances are way better for a short right now, especially when you see retailers and analysts turning long. Because if this 1950-1990 area doesn’t break upwards, it will create a TRIPLE top on the daily chart! And that can be very nasty for bulls…with a possible downmove of 300-400 pips. Next week we have ECB on thursday, so its hard to predict what will happen before that…if the market keeps ranging or if it starts a trend before the meeting, but either way, I think the 1880-1920 area will be reached next week.
Another reason for EU bears are other correlated USD pairs. GU is close to a good short area now…it might even be there now, but even if it goes 50-100 pips higher in some quick move, its still a short in the medium term, 3560-3600 is still a number I am waiting for to be re-tested. GU closed at 3840 on friday and I expect a retracement towards 3760-80 minimum early next week and from then on it depends if this area is defended or not…and if even 3680-3700 breaks, bulls might end up very badly. Monday will give a first clue…
UJ also worked out well this week, I had a target of 108.50 and 108.60 was hit, so I gladly got rid of all shorts, in case we’ll will keep ranging upwards again, for a while, but if we come close to 111 or even above 110, I might start looking for shorts again.
