Tuesday 10 January 2012

Aussie pops again this Morning, as forecast!

Yesterday's post on a bounce off 1.02:



This morning's chart, an over 100 point pop...




I expect a little bit of weakness to kick in later today as the EURUSD struggles with 1.28. Equities have continued their upward march, and this de-coupling of FX risk and "everything else" persists.

At some stage we will see a sharp (200pips in one day) EURUSD correction, as the excessively swollen amounts of short interest in this pair are forced to unwind. Of course if equities blink first, expect to see much more press coverage of the crisis, leading to November lows and the inevitable over-sell into a Feb/March rally.

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