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EUR Shorts Hit New Record

Tyler Durden's picture


Another week, another record bet on EUR currency collapse: this even in a countertrend week, when the EURUSD actually soared by over 300 pips. In other words, not only did shorts not cover, as some have suggested, they doubled down on losing positions, in the process bringing total net non-commercial spec contracts to -160K from -155K the week prior. As a result, should the EUR snap over the psychological barrier of 1.300 which it almost did in the overnight session by 15 or so pips, or should the CME hike EUR margins, we may promptly see a move in the pair comparable to the 300 pip surge experienced when the expanded QE1 was announced on March 18, 2009.


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Fri, 01/20/2012 - 16:43 | 2082254 blu
blu's picture

Why do the EUR shorts hate our freedoms?

Fri, 01/20/2012 - 16:47 | 2082281 Peter K
Peter K's picture

EURO shorts love freedom. Down with EuroFascism!

I can't believe I just wrote that:)

Fri, 01/20/2012 - 16:50 | 2082291 Spitzer
Spitzer's picture

Fundametally, the US dollar is way more fucked but people have to learn the hard way.

Is there anyone on this planet who doesnt think the dollar is the best of the worst ?

Fri, 01/20/2012 - 16:52 | 2082300 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

If A then B is a logical fallacy, but yes, investors lack logic of epic proportions.

Fri, 01/20/2012 - 17:03 | 2082334 American34
American34's picture

Why are gold and silver moving so differently today? Silver way up, gold barely up???

Fri, 01/20/2012 - 17:16 | 2082382 francis_sawyer
francis_sawyer's picture

Cause Euro:Gold is the tether... & the Au/Ag ratio is above 50...

Fri, 01/20/2012 - 17:28 | 2082421 tmosley
tmosley's picture

Someone unplugged the random number generator hooked up to gold, and inverted a sign on the one plugged into silver.

Sat, 01/21/2012 - 17:53 | 2085005 JW n FL
JW n FL's picture



Global Financial Market Regulation

Andreas Dombret: Global financial market regulation – need for a

coordinated implementation and a global level playing field

Speech by Dr Andreas Dombret, Member of the Executive Board of the Deutsche

Bundesbank, at a seminar of the European Ideas Network and centre-right Think Tanks and

Political Foundations in Europe “Long-term growth – organizing the stability and

attractiveness of European financial markets”, Berlin, 20 January 2012.


Fri, 01/20/2012 - 18:38 | 2082635 The Monkey
The Monkey's picture

Re-leveraging sentiment on. Silver/gold ratio still reflects investor risk preference until bitcoin kills PMs as PM's killed seashells and buffalo hide.

Fri, 01/20/2012 - 17:13 | 2082371 pirea
pirea's picture

most of investors are not thinkers, they run with the herd

Fri, 01/20/2012 - 18:25 | 2082609 The Monkey
The Monkey's picture

Pretty much everyone thinks the dollar is fucked. If you think we're anywhere near a sentiment extreme with respect to the dollar, you're smoking crack. Very few believe the recent rally in the dollar is anything more than a countertrend blip.

Fri, 01/20/2012 - 19:13 | 2082725 Spitzer
Spitzer's picture

Pretty much everyone thinks the dollar is fucked

Wrong. Everyone, including most gold bugs go on TV and say bullshit like  " the dollar is the best crack shack on the block"  or "the dollar is the best horse in the glue factory"

Everyone thinks the dollar is best

Fri, 01/20/2012 - 16:53 | 2082301 clones2
clones2's picture

Euro squeeze, dollar drops... US Equities should rally...

Fri, 01/20/2012 - 18:28 | 2082614 The Monkey
The Monkey's picture

"Should" being the keyword.

Fri, 01/20/2012 - 16:53 | 2082295 MillionDollarBonus_
MillionDollarBonus_'s picture

This is simply a flight to safety. Investors are finally waking up to the fact that the dollar is the ONLY true safehaven that can protect you and your family during financial turmoil.

Fri, 01/20/2012 - 16:54 | 2082304 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Fiat currencie has no intrinsic value, and using your logic, PMs would have such value as investors have gone into them with much more money than anything else over the course of the decade.

Fri, 01/20/2012 - 17:28 | 2082423 ozziindaus
ozziindaus's picture

$'s have no more intrinsic value than your title or bank statement does. I'll take it even further, since it's likely you get paid dollars at your job, then your life has no intrinsic value either. You know there is something called convertibility. Money does not have to be something tangible. Even cave men knew that.

Fri, 01/20/2012 - 18:33 | 2082628 The Monkey
The Monkey's picture

The notion of precious metals as a store of value. Sea shells were once a store of value. More recently, real estate has been a store of value.

Things change. Some of us don't give a shit about a yellow metal that you cannot eat and the government can (and has) confiscated at will.

I'm a buyer of silver at $3.00 / oz. There are few uses for gold, so I'm not a buyer period.

Fri, 01/20/2012 - 16:55 | 2082313 mayhem_korner
mayhem_korner's picture



Tell you what, MDB, I'll swap you all my available dollars for all of your precious metals - Au, Ag, and Pb - at today's fair market value.  That should make you all Chris Matthews' leg.  :D

Fri, 01/20/2012 - 17:04 | 2082342 SheepleLOVEched...
SheepleLOVEcheddarbaybiscuits's picture

mdb you are a PUTZ

Fri, 01/20/2012 - 17:09 | 2082355 Goldilocks
Goldilocks's picture

Austin Powers Ladder Scene (0:17)

Fri, 01/20/2012 - 17:19 | 2082388 anarchitect
anarchitect's picture

I gave you down votes at first but have since come to appreciate your humor.

Fri, 01/20/2012 - 17:18 | 2082390 francis_sawyer
francis_sawyer's picture

that the dollar is the ONLY true safehaven that can protect you and your family during financial turmoil

Can you please give me the BTU value of the dollar so I can make a proper assessment?

Fri, 01/20/2012 - 18:45 | 2082652 The Monkey
The Monkey's picture

The BTU value of an equivilent trade, on any given day.

Mon, 01/23/2012 - 07:06 | 2088083 resurger
resurger's picture

how about you wipe your ass with your $100 bills?

Fri, 01/20/2012 - 16:53 | 2082309 The trend is yo...
The trend is your friend's picture

anyone have any input on the 8,000,000 trade in the GLD 162 strike call option for Mar.?

Fri, 01/20/2012 - 18:47 | 2082655 The Monkey
The Monkey's picture

Since PMs have been ruuning with risk on, most of the time, I would be cautious. Sentiment in the US stock market is nearing an extreme.

Fri, 01/20/2012 - 16:44 | 2082256 MarkTwainsMustache
MarkTwainsMustache's picture

Could this not be real-money hedging?  Would explain the strong stomachs as they are likely benefiting from actual euro-cash flows on the other side of the trade.

Fri, 01/20/2012 - 16:45 | 2082261 flyr1710
flyr1710's picture

which is why the euro is going down to 1.20..seriously...follow the euro shorts

Fri, 01/20/2012 - 16:49 | 2082285 CvlDobd
CvlDobd's picture

Fucking Christ! Did you read what Tyler just wrote?

Silver shorts are low. Long SLV might be a good short term paper place to be when this euro squeeze gets underway.

Fri, 01/20/2012 - 16:45 | 2082263 ShankyS
ShankyS's picture

Can you feel the SQUEEEEEEZE coming? Friggin manipulated centrally planned BS will wipe the floor with the shorts. 

Fri, 01/20/2012 - 16:47 | 2082277 mktsrmanipulated
mktsrmanipulated's picture

really hows my short from 1.385 doin?

Fri, 01/20/2012 - 17:01 | 2082329 ShankyS
ShankyS's picture

Bravo, but you are possibly just about out of time for this portion of the fall. Much worse to come as I have 116 target. They need to clear the decks first IMHO. 

Fri, 01/20/2012 - 16:45 | 2082265 Gubbmint Cheese
Gubbmint Cheese's picture

not sure how it will happen.. but shorts of all shapes and sizes usually end up getting burned.. fundamentals be damned. This will probably turn out no different.

the only thing that works is trading like a naive moron... (robo?)


Fri, 01/20/2012 - 16:54 | 2082307 Spitzer
Spitzer's picture

fundamentals be dammed ?

Euro is a net creditor

Euro has no trade deficit

Euro is chinas biggest trading partner

Euro has the most gold in the world (10,000 tons)


Fri, 01/20/2012 - 17:01 | 2082331 LawsofPhysics
LawsofPhysics's picture

Like your moniker, a few credible links would be helpful Mr. Spitzer.

Fri, 01/20/2012 - 18:55 | 2082686 The Monkey
The Monkey's picture

Euro is in the early stages of a massive recession and whatever geopolitical surprises follow in it's wake. ZIRP, austerity and Euro weakness is on the way, regardless how much of a short covering rally can be extracted short-term.

Fri, 01/20/2012 - 16:46 | 2082266 mktsrmanipulated
mktsrmanipulated's picture

so play simpley put play eur vs aud


Fri, 01/20/2012 - 16:46 | 2082268 dcb
dcb's picture

the headline logic is flawed. I closed out my shorts when we hit the weekly high. (the majority of them), I turned around and bought the euro on thos dips, making another chart Y did buy the dat before yesterday, but then didn't sell, put new stop losse in and I'l buy . the euro positions I bought before, have stop losses in them, so no matter which way the market breaks I 'll make money.

Fri, 01/20/2012 - 16:46 | 2082271 Dr. Engali
Dr. Engali's picture

There is one heck of a squeeze coming. Too many people on that side of the trade.

Fri, 01/20/2012 - 16:46 | 2082272 DoChenRollingBearing
DoChenRollingBearing's picture

Bearing is very happy that he does not trade foreign currencies, would have lost his internal parts in an implosion...

Actually not QUITE true: I do have a 500 euro note.  Fun fact: if the serial number starts with the letter "X", it is a German one.

Fri, 01/20/2012 - 16:47 | 2082274 mayhem_korner
mayhem_korner's picture



Well, if the CME's gonna hike EUR margins, they might as well hike the PM margins to pull back the fat gains Au and Ag keep registering.  They can't smack down the EUR and risk decoupling with the narrative, can they?

Fri, 01/20/2012 - 16:47 | 2082275 rumblefish
rumblefish's picture

if TPTB can break these shorts. whould that be a case to push the us equities 'market' higher?  short covering rally, dollar down, DOW to the moon? 


Fri, 01/20/2012 - 17:12 | 2082364 Big Swinging Richard
Big Swinging Richard's picture

In the near-term yes.  However, given that Germany is the least of the worst in the Eurozone, and that they are totally dependent upon exports, a soaring EUR/USD is not exactly what Germany is hoping for.  There will be a coordinated devaluation once all the shorts capitulate.

Fri, 01/20/2012 - 16:47 | 2082278 AccreditedEYE
AccreditedEYE's picture

Can we say "convergence" boys & girls?  

Fri, 01/20/2012 - 16:48 | 2082279 glock19
glock19's picture

Lots of specs, but lots of natural hedges on sales of European assets that companies don't want to be stuck with when the Eurozone collapses.

Fri, 01/20/2012 - 16:48 | 2082280 junkyardjack
junkyardjack's picture

I might hop on the Long end for the squeeze.  The manipulated markets are going to push higher to try to stop people out.  

Fri, 01/20/2012 - 16:48 | 2082283 navy62802
navy62802's picture

While I'm not in the FX trade, I wouldn't short the Euro. Not because I think it's strong, but because I have faith that Europe's leaders will prolong this charade as long as humanly possible. I think they can put on a show for at least another year.

Fri, 01/20/2012 - 16:53 | 2082303 LawsofPhysics
LawsofPhysics's picture

As long as the power stays on and the oil and natural gas keep flowing, you may be correct.

Fri, 01/20/2012 - 16:51 | 2082293 GaryNeville
GaryNeville's picture

Market melt up explained...

FED bails out the EUR via currency swaps...

Bots linked to EUR/USD go into auto buy as EUR strengthens...

Market marches on... 0.5% a day.. We'll be at 16,000 DOW in no time.....

Remember every1.. Its all priced in!

Fri, 01/20/2012 - 16:55 | 2082315 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Silver is happy for whatever reason today.  I am not sure how it correlates, but I'll chalk it up as a win.

Fri, 01/20/2012 - 16:59 | 2082322 DoChenRollingBearing
DoChenRollingBearing's picture

A winner it is!  Up pretty big today vs. gold.

Fri, 01/20/2012 - 17:05 | 2082343 trebuchet
trebuchet's picture

gold closely correlated with EUR$ today. so maybe thats the hedge to the EUR$ short position - long gold..... lol hence the correlation

ZH ex machina

Fri, 01/20/2012 - 16:57 | 2082318 dpr10
dpr10's picture

it is not that people are not covering, but other people may be taking their place...Tyler, you said it yourself that with this many shorts this thing should be trading at 1.15-1.2...

Fri, 01/20/2012 - 16:57 | 2082319 alien-IQ
alien-IQ's picture

this despite the fact that the EUR/USD is up nearly 300 pips for the week.

Also, the /ES just went green because we can't have ANY red days in 2012.

Fri, 01/20/2012 - 17:01 | 2082327 ajk24455
ajk24455's picture

Maybe they're all right.  At this point maybe we CAN all stay solvent longer than the eurozone.

Fri, 01/20/2012 - 17:01 | 2082328 Joe Sixpack
Joe Sixpack's picture

"not only did shorts not cover, as some have suggested, they doubled down on losing positions"


Why is the euro rising?

Fri, 01/20/2012 - 17:06 | 2082346 alien-IQ
alien-IQ's picture

In my opinion, it's purely a technical bounce from oversold...but the longer term down trend channel is still perfectly in tact.

As I see it, it could bounce to 1.34-1.35 and still remain within the down trending channel. A break above that would be a reversal.

Fri, 01/20/2012 - 17:10 | 2082358 mktsrmanipulated
mktsrmanipulated's picture

weaker us dollar look at all the euro pairsand usd pairs


euro aud -.011

euro jpy -.43

usd jpy - .15


Fri, 01/20/2012 - 17:09 | 2082359 mktsrmanipulated
mktsrmanipulated's picture

weaker us dollar look at all the euro pairsand usd pairs


euro aud -.011

euro jpy -.43

usd jpy - .15


Fri, 01/20/2012 - 17:03 | 2082338 Barometer
Barometer's picture

Insiders must know something here. No one bets this hard without certainty. My tip is they know Germany is preparing to leave the Euro.

Fri, 01/20/2012 - 17:08 | 2082352 ajk24455
ajk24455's picture

I've been thinking that too

Fri, 01/20/2012 - 17:14 | 2082369 trebuchet
trebuchet's picture

Greek Crisis worsens, euro prints/ltro 2.0 floods the system with  liquidity so increase in money supply relative to US$.


Greek crisis solved lots of austerity, EU recession relative to China/US, demand side downward pressure on Euro.....  


EU can kicking, market uncertainty - see "EU crisis worsens... "


peeps thinking thy are betting on a one way street.


"Greek crisis solved, money floods into EU...... ???" short squeeze scenario






Fri, 01/20/2012 - 17:20 | 2082395 ozziindaus
ozziindaus's picture

"Germany is preparing to leave the Euro."

That's the nuclear option. If Germany revert back to the D mark or anything else, they’ll have to deal with the problem of having a strong currency which is certainly not what they want.

Fri, 01/20/2012 - 17:33 | 2082439 Barometer
Barometer's picture

I don't disagree but if you knew they were leaving you would certainly short the Euro right? You would also buy Bunds, even with a negative yield because the new currency would pay you off.

Fri, 01/20/2012 - 17:38 | 2082451 ozziindaus
ozziindaus's picture

Correct. Ever since Max Keiser broke the news, the Euro has been sinking faster than 1980 GOLD

Sat, 01/21/2012 - 07:28 | 2083803 koperniuk666
koperniuk666's picture

Euro notes with an index number satrting with X are issued by Germany.

Fri, 01/20/2012 - 19:02 | 2082699 The Monkey
The Monkey's picture

How about investors are doing the thing they always do? Herding.

That said, massive short interest does not always mean the opposite trade will work. Safest bet is to stay clear.

Fri, 01/20/2012 - 17:04 | 2082339 mktsrmanipulated
mktsrmanipulated's picture

google down 50 and ndx up lol....what fucking joke


Fri, 01/20/2012 - 17:04 | 2082340 ttown
ttown's picture

When does eddie get investigated for the fraud and insider trading he is doing in AZO shares? AZO does stock buybacks at an agreed upon price with eddie while he sells.  He sold 700,000 in the past two days without the price budging intraday. It is BS and us AZO shareholder are being screwed over and being driven to negative equity while Eddie fleeces the company just like he did to Sears. What a scimbag! AZO will not end well.

Fri, 01/20/2012 - 19:03 | 2082705 The Monkey
The Monkey's picture


Fri, 01/20/2012 - 17:05 | 2082344 sabra1
sabra1's picture

master plan is to have everyone into greenbacks, bank holiday, 40% devaluation! it's all going according to plan! google the bernanks 2002 speech, he outlined it all!

Fri, 01/20/2012 - 17:06 | 2082345 mktsrmanipulated
mktsrmanipulated's picture

bearish engulfing pattern in eur.aud


Fri, 01/20/2012 - 17:25 | 2082406 CvlDobd
CvlDobd's picture

Daily candles are beyond useless these days. Look at QQQ last year. Just a clusterfuck of gaps, reversals, wicks, engulfing etc. and nothing followed through.

My personal favorite is Monday after thanksgiving. Friday we finish at the lows beneath all support and on Monday get 490 Dow points due to the central bank collusion.

Fuck it.

Fri, 01/20/2012 - 17:11 | 2082362 ozziindaus
ozziindaus's picture

This again lends credence to the theory that the EU want the EURO to collapse.


Fri, 01/20/2012 - 17:25 | 2082408 mktsrmanipulated
mktsrmanipulated's picture

well there is cheap insurance against those squeezes called CALLS which u can buy the 1.295 for .007 for a protection against a rip[ on the psi news and if the news is not accepted well EUR will move down much more than .007 you will have a move like last week of over .02 cents putting this piece of shit, like all fiat currency's, in the cellar racing towards 1.17

Fri, 01/20/2012 - 17:51 | 2082502 Voodoo-economist
Voodoo-economist's picture

thats as of close tuesday, no? the action happened wednesday. Lets see how next weeks COT looks

Fri, 01/20/2012 - 19:01 | 2082658 slewie the pi-rat
slewie the pi-rat's picture

good idea!

riddle me this, voodoo:  when is a short not a short?

(i wish i could write upside down)

A: when it is from inventory in the warehouse

i'm wondering if this might be somewhere the swissNationalBank might offload, but i'm not familiar enuf w/ the settlement terms to figure it out!  ignorance is not always bliss?

Fri, 01/20/2012 - 18:35 | 2082631 q99x2
q99x2's picture

Control Central knows precisely how to get the most out of others shorts.

Fri, 01/20/2012 - 18:48 | 2082659 bnbdnb
bnbdnb's picture

Rip your face off EURUSD rally to 1.34, then 1.20

Sat, 01/21/2012 - 11:30 | 2084039 PORTA PORTA
PORTA PORTA's picture



check thw latest report on Greek debt, ISDA

also have a look aty DDCC page



Sat, 01/21/2012 - 19:12 | 2085154 MillionDollarIdiot
MillionDollarIdiot's picture

So much bitching and moaning on this thread...I guess your all the suckers who were long when I went short @$1.48...Now your probably the mugs who are short from 1.26 and you dont expect a short squeze, your the dumb money im afraid.


Disclosure: Took profits on short @ $1.27

Went long euro @ $1.2645 (targeting $1.32-35 depending on euro nonsense saviour plan ( @which point you want to flip and go short fruit cakes...Its not hard

Sun, 01/22/2012 - 12:12 | 2086476 ILM5
ILM5's picture

The 03/2009 rally from a technical standpoint showed a clear double bottom with a positive divergence on the second sell off from a weekly standpoint.

This one has a completely different personality and shows even more weakness on the last leg down, I think a visit lower will occur before any rally to the upside.


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