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Has The Euro Turned?
The call that a turn in the dollar was imminent by Brown Brothers Harriman’s Mark Chandlers is looking more prescient by the day (click here for the call at http://www.madhedgefundtrader.com/october-12-2010-marc-chandler.html ). September and October was all about pricing in Ben Bernanke’s quantitative easing, and that is looking pretty much done. The next play in this kabuki drama will see “uncertainty” emigrate from the US to Europe, sending the dollar off to the races and the Euro in for rehab. Lindsay Lohan, eat your heart out.
A reemergence of the “PIIGS” disease, concerns about the deteriorating quality of the lesser sovereign credits in Europe, is now unfolding as the triggering event. US interest rates rising at the long end are adding fuel to the fire, shifting interest rate differentials overwhelmingly in Uncle Buck’s favor. It also helps that 95% of traders are bearish on the dollar, the surest indicator you’ll ever see that it is about to go the other way. While America’s trade deficit remains massive, that shortfall is being overwhelmed by enormous amounts of foreign capital pouring into our stock and bond markets, on which Ben has painted a giant bullseye.
It all adds up to the $1.4250 print we saw on the Euro last week marking the high. Rallies from here in the European currency are to be sold. Players new to the space can achieve this through buying the (EUO) ETF, a leveraged 200% short bet against the Euro. Looking at the charts and the momentum, we could see a plunge below $1.33 by year end.
To see the data, charts, and graphs that support this research piece, as well as more iconoclastic and out-of-consensus analysis, please visit me at www.madhedgefundtrader.com . There, you will find the conventional wisdom mercilessly flailed and tortured daily, and my last two years of research reports available for free. You can also listen to me on Hedge Fund Radio by clicking on “This Week on Hedge Fund Radio” in the upper right corner of my home page.
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This is depressing.
With regard to QE2 , 3 , 4
Is essentially what ben is doing? - saying i don't care i'm gonna just create more debt until this is 'fixed' and future generations can pay it off.
or
i'm gonna devalue the dollar to inflate away our debt.
the first one is scary.
The Euro fluctuates. The signal event has been bandied about one way or another for the last three years. Seems range bound and tradeable for sure.
With sufficient margin, one should be able to buy it here at 1.346 and sell it some time later on for a 2-3 cent gain. And then sell it short and cover at 1.34 again, repiting usted.
You should let your robot handle those details.
and to add, if there are more bailouts for shit countries in the EU, then the EURUSD will rise back to 1.45...
its retarded but true...
The weekly chart would offer another opinion. It appears that the Euro is headed for 1.273 in rather short order.
Let's make a side bet. I'll bet it doesn't approach 1.273 in the next short order once you define what that it.
Ten weeks.
End of January, 2011.
I disagree. All this PIIG nonsense was brought back up simply to weaken the euro and strengthen the dollar. We are now back into the primary trend. This is from a post of mine at tfmetalsreport back on Tuesday:
"Does anyone else find it just a little too coincidental that, after six months of peace and quiet, the entire EU debt fiasco once again rears its ugly head just as the Euro reached 1.42 and the dollar was collapsing? I mean, seriously, the timing is blatantly obvious. If you don't believe in the global manipulation of the 24-hour news cycle, you should. This is prime example #1. The currencies, in their relative movements, were getting out of whack. Hmmm, how to weaken the Euro and thus strengthen the $? I know, lets bid up PIIG cds and get that ball rolling again. In one week, the euro has moved from 1.3950 to 1.3550 and the USDX has gone from 76.90 to 79. So far, you have to say, its worked pretty well don't you think?"
The euro will now rally and the dollar will resume its downtrend.
Turd,too much truth is bad for the sheeple,regardless of the total shambles and fraud of the international markets to tell the truth is the biggest crime of all,an even bigger crime than wearing a big hat.
I agree, the EUR will rally again... but It could be as orly says that we will go much lower in the short timeframe, before the "real fundamentals" come back into play.
As an FX trader, a 3cent move by XMAS is NOT A PLUNGE, its called a grind...
A plunge is the first 500 pips that madhedgefundtrader missed telling you was coming...
All your plunges are belong to us, make your time.
Cheers
Yes, the Euro has turned. Little noticed on GM Day that the Euro began to roll over again.
I have a bad feeling about this. If there comes a bit of a sell-off, the market may reach a critical mass as traders bail and head for the exits. There is a good chance the SPX could close in the red.
The Euro is saying something. Whatever it is is not at all good for the equity markets.
Led lower by GM?
Did you actually have lunch with Hugh Rowe?
So Ireland Bonds are dropping marginaly.
But look here... the Iberians and the Itallians are warming up
Spain
http://www.bloomberg.com/apps/quote?ticker=GSPG10YR:IND
http://www.bloomberg.com/apps/quote?ticker=GSPG10YR:IND
Italy
http://www.bloomberg.com/apps/quote?ticker=GBTPGR2:IND
http://www.bloomberg.com/apps/quote?ticker=GBTPGR10:IND
Think your part...
Whether to short or long the pair is like chosing which of two equally disgusting obese and std infected prostitutes will receive "sexy time" without the rubber...
To find out more about the Imminent Collapse of the Global Economy, watch this video "Wall Street Thieves, Bailouts Galore, Broken America" at (http://www.youtube.com/watch?v=I93dzfs8WIc).
by Anonymous
The United States economy is rotten at the core and has been stolen from the American people by the Wall Street Thieves that drove the Titanic into the iceberg in the first place!!
Yes, it turned into a pumpkin and Merkel lost her slipper last night.
Angela meine Leibe