AdrianRaymondFX
Short

$1.15 could be a level to short the euro

FX:EURUSD   Euro Fx/U.S. Dollar
The euro             has risen significantly against the US dollar             these past couple of weeks, and prices are reaching a key resistance level around $1.153 (February's highs). A long-term trend line comes in at around the same level, which makes me believe that shorting EURUSD             will be again possible starting next week. If indeed this is the case, we would need to see the US dollar             stabilize (watch the Dow Jones-FXCM US Dollar Index             at around 11,580/90 points for support). With the recent volatility in European sovereign yields, the markets have seemed to have forgotten the long-term fundamentals : the BCE will continue buying up sovereign debt even if disinflationary forces abate. I expect that investors and traders will realize this fact soon enough once yields start falling again, which would make a short strategy on EURUSD             attractive. The only real obstacle to seeing renewed pressure on EURUSD             is the poor US economic data that is weighing on expectations of a Fed rate hike this year. I don't foresee data improving right away, so this could make shorting EURUSD             at $1.15 a bit difficult. A break above 1.16$ would invalidate this strategy, likely leading to a move back up to $1.18 and possibly $1.20 this summer.
TheShakeOut
2 years ago
Interesting analysis. My volume spread analysis shows strength in the market at the moment. However we will have to keep an eye to the 1.1570 level, supply could enter the market around that price.
EURUSD: Demand overcoming supply below key levels
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AdrianRaymondFX
2 years ago
Looks like I was a little too picky on the level. Any bounce off of $1.105 back to the bearish trend line could be another opportunity to short. This will likely be below $1.15 however.
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