Still want to be short EUR

I still want to be short EUR – an increase in supply via the ECB’s LTRO and a track record of disappointment from European political leaders makes me think a sharp move down may be due.

I’ve avoided shorting EUR/USD because it was a very crowded trade, but the 6 big figure rally from 1.26 may have helped reduce the number of shorts. Additionally, I like the set-up the 4 hourly chart is offering:

This is suggesting to me a split position – a short term sell here, with a stop just above 1.3200, and a longer term (smaller) position, sold here with a stop above 1.3230.

Would be interested to hear from any buyers of EUR/USD at current levels, and the case for the trade.

About michaelmccarthycmc

Chief Market Strategist - CMC Markets and Stockbroking Regular on ABC, BBC, Bloomberg, Channel TEN, CNBC, SBS and SKY
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9 Responses to Still want to be short EUR

  1. Ratish says:

    Very interesting chart. Tempted to short the Euro now.

  2. xsor says:

    Hi, I go long at current support level at 1.308. I think it’s just pull back before we can see a strong EUR.

    • michaelmccarthycmc says:

      Interesting – I see its bounced off 1.3043 overnight – have placed a buy for a third of my position just above the low to lock in some profit. Think the supply of EUR from the ECB, lack of investor interest and a likely flaccid agreement from European leaders summit could see lower levels over the next week though.

      Thanks for sharing your view.

  3. yesterdays daily candle retested the low of the previous day, looking at a 4hourly chart we can see the sell off resulted in a dip directly into previous resistance, or nothing more than a buy the dip opportunity. Until something gives like a previous low being breached or an ascending trendline breaking i would continue looking for buying opportunities – Unless you are a master top picker 🙂 Good luck and thanks for sharing

    • michaelmccarthycmc says:

      Thanks for you thoughts – and can see from a purely technical view why traders could be positive EUR – my process is different – but that’s what makes markets – buyers and sellers

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