We just said that to get you riled up. But… We think there is a low risk trade in shorting the euro. The stop is just over the nearest high by 1% or so, or by watching the hourly bars for a breakout and power bars. This is for aggressive traders only.
Oddly we don’t think buying the UUP (dollar index) is the other side of this trade. There is no signal in the UUP.
But, but, but … there is no signal in the FXE euro either. Isn’t that just the truth. Just call us dealers in paradox.
Doesn’t this mean that gold is due for a fall and the dollar due for a rise? Probably. But the timing is in the “who knows?” category. We think we are in for some near term volatility, but at the moment we don’t see major trend changing action — just nasty downwaves.