Nov 13 '15 EURUSD Short Setup

FX:EURUSD   Euro / U.S. Dollar
77 0 3
Hacking the Fundamentals

In line with our Fundamental Outlook, we are looking to short EURUSD             on pullbacks. This is mostly due to ECB and the Fed's monetary policy divergence. But yesterday's "Conference on Monetary Policy Implementation in the Post-Crisis Period" saw some remarks from speakers that could have cast some doubt as to whether the Fed is 100% serious on their plans. This triggered more profit taking and position reduction from players and this might have caused the EUR to rally up to 1.0830. This could have been just an over reaction since it's natural to expect dissenting opinions among the board members.

Be that as it may, nothing has really changed. So this temporary sentiment has opened an opportunity for a better price for a short. Today's Core/Retail Sales and PPI is expected to be strong and should slam the EUR once again.

Hacking the Technicals

The EURO's rally was stopped at 1.0820 which was a Support turned Resistance as seen in the Daily Chart . This could be a good level to go short and there is no reason to expect the market to break above it and go to pre-NFP levels at 1.0900.

Trading the EURUSD

Ideal Entry at 1.08100
SL at 1.08400
Initial TP at 1.06900.

Main Driver: Core/Retail Sales and PPI. If report is better than expectations, I'm looking to hold 50% of my position up to 1.0600.
Comment: The Core/Retail Sales Release was disappointing and could have some influence the Fed's decision for December. But it still doesn't remove the fact that the EUR is weak and the ECB is planning on more easing. The GDP of Europe hasn't shown improvement which makes Draghi's threats very real.

As for the US, it really seems like they are trying to find reasons to raise rates. Though the October Jobs report was spectacular, other indicators aren't as impressive. So why are they trying to find reasons to raise rates? Seems like they are trying to create a false perception that the economy is improving. Is it because of the coming US elections? Hmm....

But then again, it's still a long way to go, and any negative news from the US will just make the next NFP report even more important for the market. Let's see how the the market reacts on this release. But I am still looking for a short on EURUSD and my ideal entries still rests above 1.0800 to 1.0840.
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