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Euro Plunges, Citi Stopped Out

Submitted by Tyler Durden on 04/18/2010 22:07 -0400

On April 13 we pointed out that Citi put on a long EURUSD recommendation with a 1.349 stop. The cynics in us were confident that this was merely a way for Citi to dump its EUR book.

[Citi] has just issued a long EURUSD call at 1.359. The call by technical
analyst Aron Gera, proposes a stop at 1.349. In other words it is now
Citi's turn to offload its EUR book. Gera's recommendation is based on
technical analysis, which, in the form of momentum chasing, is all that
seems to work these days. Aron thinks the EUR could surge to an 11-week
high, even as the GBPUSD could jump as high as 1.5966 alongside EUR
strength.

Mission accomplised. The euro is plunging (last at 1.346, just barely above the 1.345 option barrier) as Shanghai is dropping, Japan is not doing all that well, and half the world is lining up to sue Goldman Sachs. A surging dollar will do nothing to help a market that has just had its first reacquaintance with risk after three months (sorry Bernanke, even endless liquidity is not omnipotent). At least Citi managed to sucker in a couple of its best clients. Will these clients now sue Citi if they found out that Citi was, gasp, shorting the EUR against them?

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Sun, 04/18/2010 - 22:13 | 307249 ZeroPower

Technically the 1.349 stop woulda been hit on friday no?

Sun, 04/18/2010 - 22:25 | 307261 williambanzai7

Did anyone notice this over the weekend? This will partially explain Shanghai's drop.

DOCUMENT NUMBER 10:

http://www.sinocism.com/archives/223

Sun, 04/18/2010 - 22:36 | 307271 Fish Gone Bad

Nice article William. I enjoyed this quote, "Commercial banks can refuse to issue loans to buyers of their third home in areas suffering from excess property price rise, said the State Council, or the Cabinet, on Saturday."

Sun, 04/18/2010 - 22:36 | 307270 fUny1

We might be facing an Albert Pike inspired Middle East showdown soon. Would that not plunge futures and currencies and related assets?

Israel just threatened to send Syria back to the stone age.

http://funy1.blogspot.com/2010/04/star-of-moloch-middle-east-title-bout....

http://www.timesonline.co.uk/tol/news/world/middle_east/article7101106.ece

Meanwhile, the US and Europe are being sent towards the stone age via the Government Sachs method:

http://funy1.blogspot.com/2010/04/corrupt-politicians-doing-bankster.html

Mon, 04/19/2010 - 07:12 | 307506 Missing_Link

"Albert Pike-inspired?" Too subtle for me ... I looked it up on Wikipedia and I still don't get the connection.

Mon, 04/19/2010 - 09:01 | 307654 ciscokid

Isreal can warm Syria or who ever they want, but the fact

is they cannot do much now as it will result in very costly

loss of life of both sides.Things have changed and all sides

will just have to learn to live with it.

Isreal only way out is to seek real peace with its naighbours for the days

of the six day war is over.

Sun, 04/18/2010 - 22:40 | 307274 RobotTrader

As usual, Dollar and Bond bears are taken to the cleaners.

Just give this market a couple of days to sell off.

You will see another "flight to safety" which will drive down yields again and make our endless deficit financing effortless.

Mon, 04/19/2010 - 00:44 | 307379 texpat

Sweet, good time to think about loading up on TBT calls, before the auction announcements later in the week.

Sun, 04/18/2010 - 22:47 | 307281 ratava

does this mean the big brother would really hate if we went long euro right now? reverse psychology of psychopaths hurts my head.

Sun, 04/18/2010 - 22:52 | 307286 brooklynlou

Now now. Citi and Uncle Sam are one and the same. How dare you voice such cynicism - its unpatriotic.

Sun, 04/18/2010 - 23:07 | 307300 chealy3

about time you woke up

Sun, 04/18/2010 - 23:25 | 307322 buzzsaw99

It matters not how many bad bets C makes, they don't count losses, hide toxic assets at teh fed, and their stock and bonds have the same guarantee as usa treasury bonds.

Sun, 04/18/2010 - 23:54 | 307342 Mr Lennon Hendrix

I thought gold had decoupled on November 5th, when for the first time all year the doelarr had moved up with gold. Then Barricks Gold Miners pulled the rug out from under the market, setting up the January, February, March pullback in stocks (the markets tracks gold, not the other way around). Now, I think everybody can note, even my friends who do not watch "this stuff" can figure gold decoupled. Wait until the markets and currenseas (yes CURRENTSEAS) tread water but gold and silver et al rise. C.R.E.A.M. is over!

Wu Tang Clan- "C.R.E.A.M.":

http://www.youtube.com/watch?v=bjZRAvsZf1g

Sun, 04/18/2010 - 23:53 | 307350 knukles