Time to short Euro ?

Discussion in 'Trading' started by taodr, Jan 27, 2003.

  1. taodr


    CNBC just had a fund manager on predicting the Euro will climb to $1.20 because of balance of payments etc. Actually I'm willing to bet time to short the Euro is soon. In the past whenever bubblevision has some one on emphatically stating the $ is toast it goes the other way. The Arabs and Europeans are buying Euros right now in protest but Europe will wind up worse than the US. China and most of Asia will deflate manufacturing. In this respect Europe is in the Shithouse because of their socialist labour unions controlling their governments.
  2. man


    no doubt that there is evidence for what you say, but - you know - timing against a raging bull is a tough call.
  3. cheeks


    Just becareful. Taking the other side of a trend in FX can be ugly.
  4. msfe


  5. Look at the shaky Swissi. Just did a nice move ...


    :) Peace & Happiness :)
  6. How about FX Options?
  7. Willybob


    The Euro is strong against the Dollar as it is recognised widely in Europe that the American economy is going down the pan and that the American Markets are still way overpriced.

    Europe has some problems but are ahead in the business cycle so have perhaps taken the pain.

  8. taodr


    Europe is "ahead" in the business cycle ? Are you sure of that ?
  9. Tycoon


    The ECB is arguably behind the curve in reducing interest rates now that Europe is showing clear signs of slowing down and possibly entering a recession. Macro funds are trying to capitalize on that by purchasing euro 2-yr notes, and that's obviously a boon to the euro.

    But I'm not terribly bullish on the euro because bullish sentiment is far too high. You can see that in the COT report which shows a large rise in the long positions of non-commercials.

  10. man


    I think the market is currently shaking within a frame of too many partly contradicting facts at the same time. The euro profits from the different policy of ecb and fed, but europe, and especially germany can not afford a still rising euro very much longer. I doubt the business cycle theory, europe was never ahead, why should it be now. Europe, and here again germany, still suffers from reStructuring cost.
    I think Bush desperately needs this war in Iraq. He placed an expensive trade, already bears transaction cost, and now wants some profit. But its getting tough and tougher since Saddam does not give in, yet does not provoke too much mediainteresting anger.

    To me Japan is somehow funny. The most busted economy does not react too much currently. It might be that 8000 for the Nikkei is the level the government is willing to defend by any means. Since they are already in debt by 150% of GDP, they do not care any longer on the one hand, but will be forced sooner or later to let the market go where it wants to go ...

    I think the US still has the best position for recovery. There is no structural cost or crisis comparable to europe, which will face even increased restructuring cost with the new members in 2004. And Japan will sooner or later have to let some banks go bust and swallow all the trouble.

    I think the straight line the Euro is currently showing against the dollar is a further indication for the comparably improving position of the US. Everybody wants a weak currency now - the US get it.

    I would not bet too much on a Euro going to 120. If I was already in I would run the trend with a trailing stop. But I would not at all bet against that trend before it shows significant weakness.
    #10     Jan 28, 2003