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.