I believe being a contrarian just for the sake of it is a fool's game. However, there are certain circumstances, when a contrarian view is warranted. I believe the dollar rally to be one of these special circumstances, I explained my reasons in my previous charts.
First of all, I am not sure the dollar rally ended. As I am as sure as I can be from a trading perspective, however, if I see a break of the neckline on the daily EURUSD and DXY charts, then I can certainly say that the uptrend is over. Until then, I do have a huge position short dollar, so my money is where my mouth is (my money plus a huge amount of leverage).
If I am right about this one, when everyone will wake up, we will see a huge rally in probably every pair against the dollar (anyone looked at EM markets lately?), including the hated Euro.
On the fundamentals of Europe, headline inflation is going higher and higher, and that will eventually spill into the core as well. I am very bullish on OIL, which is one of the main reasons we see headline inflation so high in Europe. GDP is higher than was previously expected, and all the PMIs were positive this week, from every important country. The market is indeed spooked of the prospect of a Le Pen win, but that is a very long shot.
Look for 1.15 in the coming months. SOFT STOP below the major swing low!
First of all, I am not sure the dollar rally ended. As I am as sure as I can be from a trading perspective, however, if I see a break of the neckline on the daily EURUSD and DXY charts, then I can certainly say that the uptrend is over. Until then, I do have a huge position short dollar, so my money is where my mouth is (my money plus a huge amount of leverage).
If I am right about this one, when everyone will wake up, we will see a huge rally in probably every pair against the dollar (anyone looked at EM markets lately?), including the hated Euro.
On the fundamentals of Europe, headline inflation is going higher and higher, and that will eventually spill into the core as well. I am very bullish on OIL, which is one of the main reasons we see headline inflation so high in Europe. GDP is higher than was previously expected, and all the PMIs were positive this week, from every important country. The market is indeed spooked of the prospect of a Le Pen win, but that is a very long shot.
Look for 1.15 in the coming months. SOFT STOP below the major swing low!
Trade closed manually:
EURUSD is doing exactly what it shouldn't, failing at the H&S neckline. Closed out!