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EURUSD Free-Falling

Tyler Durden's picture


EURUSD just traded under1.2150, down over 130 pips on the day. The question is - will wee see the ubiquitous rip-roaring reversion rally into the European close again? Rather notably this is as big a liquidity/break-up premium to its swap-spread-implied fair-value as we have seen since the peak of the crisis in mid November last year!



and the premium to swap-spread-based fair indicates a great a concern over break up as we have seen since the peak of the crisis last fall...

Chart: Bloomberg

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Fri, 07/20/2012 - 10:01 | 2635831 LawsofPhysics
LawsofPhysics's picture

Fucking awsome, bloody muppets.   Will we see reversion?  Is the pope Catholic?

Fri, 07/20/2012 - 10:02 | 2635849 GetZeeGold
GetZeeGold's picture



Thought the last bailout fixed that.......huh?


Guess not.


Fri, 07/20/2012 - 10:04 | 2635868 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

King Dollar!

Fri, 07/20/2012 - 10:08 | 2635893 Peter K
Peter K's picture

And energy independant within 5 years to boot :))))))))))))))))))))))

Fri, 07/20/2012 - 10:16 | 2635934 I think I need ...
I think I need to buy a gun's picture

bernanke said on wednesday he had news clippings  from 2008 and 2009 about how wrong they all were regarding the collapse of the dollar,,,,,,,run for your lives

Fri, 07/20/2012 - 10:18 | 2635944 spastic_colon
spastic_colon's picture

will we see reversion....haha...thats so cute.....ofcourse we will, currency markets influence more than just currency markets silly

Fri, 07/20/2012 - 10:24 | 2635976 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Yes the dollar smells just as shitty as the euro; it is all fiat and done by decree.  Nothing but IOUs this system is.  DO away with this system:

Buy Silver!

That which has no counter party risk!  That which keeps its molecular structure and stores its wealth, however its wealth is determined!  Take the money supply back!


Fri, 07/20/2012 - 10:40 | 2636039 j0nx
j0nx's picture

Anyone who bought silver in the past year has had their asses HANDED to them. Buying it for TEOTWAWKI is one thing but buying it as an investment is a poor choice. Junk away.

Fri, 07/20/2012 - 10:44 | 2636067 Nussi34
Nussi34's picture

They should have called it Icarus, not Euro.

Fri, 07/20/2012 - 10:47 | 2636086 ParkAveFlasher
ParkAveFlasher's picture

Anyone else notice a slight decoupling of silver from gold this morn?  They normally chart in tandem.

Fri, 07/20/2012 - 10:50 | 2636097 fuu
fuu's picture

"one thing but buying it as an investment"

Hahahaha, good one.

Fri, 07/20/2012 - 10:55 | 2636099 Think for yourself
Think for yourself's picture

I don't know - I bought 40 oz of silver over the last year - price average, premium included, 33$ per - and I still have exactly 40 oz. It feels like a rather stable vehicle, doesn't it?

Your problem is that you think of silver as a speculative investment - but those who do understand silver see it as a safe storage vehicle for accumulated wealth. These are 2 very different purposes which by definition are polar opposites of each other.

Fri, 07/20/2012 - 17:01 | 2637744 j0nx
j0nx's picture

Negative ghost rider. I bought it for end of the world and trading purposes if shit breaks down along with lots of ammo. As an investment not so much. That's my point. As an investment it is not a sound choice.

Fri, 07/20/2012 - 11:03 | 2636154 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Buy low......

Fri, 07/20/2012 - 11:17 | 2636218 Think for yourself
Think for yourself's picture

... and don't sell (unless if you really fucking need to)

Fri, 07/20/2012 - 10:41 | 2636051 CrashisOptimistic
CrashisOptimistic's picture

FYI Saudi Arabia's domestic oil consumption has doubled in the past decade.  It is rising exponentially.

Countries may become oil independent in a way they may not prefer.  If there are no oil exports to buy, then you are independent.

Fri, 07/20/2012 - 10:06 | 2635878 Dr. Richard Head
Dr. Richard Head's picture

In light of the Olympics, I would like to introduce a new event - Can Kicking.  We have already seen the exposition phase ofthis event introduction, so to bring it into the fold of the golbalist games is the logical next step.

I can see it now, audience members cheering on their respective central bank and their can kicking ability.  The good thing is that no amount of dexterity is needed, as old white men have been can kicking for a good forty years now.

Fri, 07/20/2012 - 10:12 | 2635913 LawsofPhysics
LawsofPhysics's picture

I like it.  My only suggestion;

All bankers and government monetary "experts" are forced to play, the losers are publicly executed by guillotine.

Fri, 07/20/2012 - 10:12 | 2635916 Dr. Richard Head
Dr. Richard Head's picture

GAME ON!!!!!

Fri, 07/20/2012 - 10:17 | 2635941 HoofHearted
HoofHearted's picture

And the winners probably need a tar and feather treatment too.

Fri, 07/20/2012 - 10:19 | 2635947 fuu
fuu's picture

Can we dip the top three in molten gold, silver, and bronze?

Fri, 07/20/2012 - 10:40 | 2636042 Dr. Richard Head
Dr. Richard Head's picture

If I could up arrow more than onece I would.

Fri, 07/20/2012 - 10:22 | 2635959 JenkinsLane
JenkinsLane's picture

I think there should be something "Hunger Games-esque" for the losers instead of just the plain ole' Frenchie - something to keep the kids interested like.

Fri, 07/20/2012 - 10:43 | 2636065 Carl Spackler
Carl Spackler's picture

How about another introductory sport for the London Olympics?

   Cliff diving


Fri, 07/20/2012 - 10:54 | 2636115 yabyum
yabyum's picture

Can kicking? No one can bend it like Bernanke!

Fri, 07/20/2012 - 13:50 | 2636928 PoorByChoice
PoorByChoice's picture


Fri, 07/20/2012 - 11:04 | 2636163 JamesBond
JamesBond's picture


Same thing -

Our politicians own the real world record.



Fri, 07/20/2012 - 10:00 | 2635833 ThunderingTurd
ThunderingTurd's picture

Yes. Groundhog Day...

Fri, 07/20/2012 - 10:00 | 2635834 ZeroPower
ZeroPower's picture

Like clockwork, London session handing it over to NY session, a few more dips, and then an EOD rip to burn the sheep shorting under 1.214s

Fri, 07/20/2012 - 10:05 | 2635872 Yen Cross
Yen Cross's picture

The best they will get today, is a 38.2% retrace.

Fri, 07/20/2012 - 10:01 | 2635835 AccreditedEYE
AccreditedEYE's picture

Answer: Most likely.

Fri, 07/20/2012 - 10:01 | 2635836 Sofa King
Sofa King's picture

Selling off to cover those Chipotle losses...

Fri, 07/20/2012 - 10:07 | 2635884 Dr. Richard Head
Dr. Richard Head's picture

Chipotle loses bring on visions of diarrhea.

Fri, 07/20/2012 - 11:08 | 2636181 Lohn Jocke
Lohn Jocke's picture

Have you tried Chipotleaway? It gets the bloodstains out of your underwear.

Fri, 07/20/2012 - 10:01 | 2635842 Yen Cross
Yen Cross's picture

 eur/aud gives new definition to beating someone while they are down!

Fri, 07/20/2012 - 10:01 | 2635844 Itch
Itch's picture

Somehow i think that wont happen today.

Fri, 07/20/2012 - 10:05 | 2635871 Itch
Itch's picture

i.e swiss 10yr in 7.6% and Germany in 4.1%...til take a brave man to go all in now. Nothing wrong with scalping the bottom though.

Fri, 07/20/2012 - 10:03 | 2635855 buzzsaw99
buzzsaw99's picture

teh eurozone is on fiya!

Fri, 07/20/2012 - 10:05 | 2635873 Portugal
Portugal's picture

Reversion? We dont want it... from this side of the world. Its good for our exports... to you!

Keep paying the bills guys!

Kind regards from Europe

Fri, 07/20/2012 - 10:06 | 2635881 monopoly
monopoly's picture

And we are down less than .5%. Free markets. Right!

Fri, 07/20/2012 - 10:45 | 2636076 Carl Spackler
Carl Spackler's picture

Are you saying that ANOTHER rate is being manipulated by libor-ing bankers in Europe?

   I bet the Fed does nothing!

Fri, 07/20/2012 - 10:07 | 2635883 I Am Not a Copp...
I Am Not a Copper Top's picture

None of it matters.  We will probably close green on the day on no volume.

Fri, 07/20/2012 - 10:18 | 2635943 JenkinsLane
JenkinsLane's picture

Chin up son.

Fri, 07/20/2012 - 10:08 | 2635887 mark7
mark7's picture

Why would Spanish and Italians want to leave from eurozone when it is nicely providing a devaluation? Spanish export sectors hit the all time record this March. And Americans are once again shorting eur-usd aka shorting themselves until turning blue.

Fri, 07/20/2012 - 10:15 | 2635929 dpr10
dpr10's picture

you are being sarcastic right;;))if devaluation is such a good thing, why dont you exit;;))

Fri, 07/20/2012 - 10:21 | 2635950 mark7
mark7's picture

In the export sectors devaluation usually help a lot and in the US this euro devaluation makes even harder to close the trade deficit. Airbus vs. Boeing for example, who is going to win now more orders...Airbus.

Fri, 07/20/2012 - 12:23 | 2636486 Nobody For President
Nobody For President's picture

Uh - Airbus wingspar problems ain't gonna go away if the Euro devalues - there are quality/production/reliability issues and problems with the 370 that actually matter a hell of a lot more to purchasers than the value of the Euro on any given day or month.

aka "If it ain't Boeing, I ain't going."

Fri, 07/20/2012 - 12:57 | 2636671 mark7
mark7's picture

What a bunch of bullshit. That problem has been solved already.

Fri, 07/20/2012 - 10:08 | 2635888 CheapBastard
CheapBastard's picture

Strong dollar will pull us out of this great recession.



Fri, 07/20/2012 - 10:48 | 2635889 BlandJoe24
BlandJoe24's picture

Not saying this is how I want it to go, but today (lit tomorrow) is options expiration, so given the dominant short interest and the historical precedent, seems likely EURUSD and equities in general will shoot way up sometime today (to squeeze out the shorts).

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