EURUSD

This was pre christmas eur/usd buying or short squeeze. I think it was short squeeze. Many people were stuck at shorts from 1.28 levels and giving up hope and most of them must have covered their shorts yesterday. I expect order books till 1.3000 will be cleared now. Expect asians to retest 1.3186. after that i think it will go to 1.3050 and close the year there

Same here, I still haven't found the answer yet. Took some Gold and EU swing trades this week, I short Gold from 1720 and got burnt by EU. That shite. Still holding my Gold short though.

I think it was short squeeze. again I am saying this.

You're not understanding what's going on because you are trading the euro... you are FORGETTING that the euro is only ½ the currency pair... the OTHER ½ is the USD, and at the present the fundy's on the USD are MUCH MUCH worse than on the Euro.... fiscal cliff, weirdo Bernanke etc.

If you doubt my theory then riddle me why the AUD and GBP are screaming up when every man and his dog are saying go short?

The common theme across all USD pairs is USD weakness.

Dont say I didnt warn you..

I have posted my Gold and EU chart for coming days ahead, for those who are interested here:

http://www.forexfactory.com/showthre...62#post6296962

Hey guys!

well i'm new here.. and i will start with my first screenshot..

so what do you thing about it..please describe and comment.. thx you all =)

Printed this one too... I will publish a book with your posts mate...

USD INDEX UPDATE

EURUSD UPDATE

APPLE UPDATE

Reason for friday s eur usd move. this is not my original story i have read over the internet

Friday’s EURUSD session has left many traders wondering what was going on as it was a day with little news to support the move – and- the move was pretty much in contradiction to what was seen in stock markets.

To understand what was going on, one has to know what FX banks – especially the market makers - are doing and how they behave under certain thin market conditions.

Leading up to Friday morning European time a market scenario had developed which I wrote about in my blog below (see “EURUSD Stop Hunting”).

European banks did not approach the second stop level by 1.3125 for reasons one can only speculate. They might not have thought is was a move worth making as it was a day without news to support the move – or – as it was at the top end of the range seen for the week, they might have seen the move as too risky. Whatever reasons they had, they did not make an attempt to do it.

By 5:00 p.m. European time European banks have no commitment to act as market makers anymore. They have finished for the week. To be a market maker means that you are committed to quote a 2 way price (bid and offer) to any other market maker asking you for a price. As such, the role as market makers were only conducted by US banks.

On Fridays by the time European banks close their activities and US banks are on their own, the market is extremely thin. It is a fraction of what it is throughout the week in terms of volume traded and orders it can take. I would estimate the traded volume during Friday afternoon in NY to be no more than 5% of that traded during normally opening hours midweek European time.

So – tempted as one or two of the US banks obviously were to take out those stops being left by European banks – the whole event Friday afternoon became a liquidity squeeze among those few market makers still being in the market.

Specifically – this is what happened: By 5:00 one bank took out all offerings seen from 1.3105 and up to 1.3125. To more joined the race as they saw the move early enough. By 1.3125 stop orders were triggered among all banks, hence they had to buy the EURUSD on behalf of their clients being stopped out. This move took the EURUSD to 1.3140 at what time the stops had been done. Who supplied those banks with EURUSD for the last 15 pips? IT was of course those 2-3 banks who had bought EURUSD from 1.3105.

Stop orders were done and over the next hours, the market settled down a bit. But – most market makers were left net short from this spike and as it was Friday, most standard instructions within those banks are that positions shall be left to a minimum. They might keep positions they enter into “with open eyes”. But the traders are requested to close the positions they are “forced into” through their market making activity.

With most of the remaining market makers being left short in EURUSD and a thin an illiquid market coming up, it was bound to be another spike – not from news, not from what was seen in stock markets, not from any technical indicators and not from clients’ order books. Only from the scenario that a few banks were left short with instructions to get out of those positions.

So when a few banks have to buy the EURUSD and there are really not that many others left in the market that you can buy from, then a liquidity squeeze comes up and this time it took the EURUSD from 1.3130 to 1.3170 – within minutes.

By that level most positions were squared out and those being long or short were happy with what they had. The last 4 hour of the NY sessions became “dead” and uninteresting as there were no reasons for any of the remaining banks to make any moves. Weekend had settled in.

After the market finished and this morning I have read all kind of explanations to what happened yesterday – from long-term predictions of a collapsing USD, to sophisticated technical hypothesis about levels triggering moves – all kind of theories pundits can think of.

But in reality – what happened yesterday was what is described above. The trigger was what I call “Stop Hunting” and the epilogue was a “liquidity squeeze”. It was nothing more and nothing less.

It happens once in a while and especially in thin market conditions on Fridays.

Don’t read more into it than that. Whatever is going to happen next week is another ball game. We might like the higher level from what we see next week or we might not like it from what is coming up next week. And should we not like it, it will be easy to correct the move as the volume supporting the move yesterday was pretty thin.

Have a Nice Weekend.

This, Bernanke is pretty much having a $$ bonfire. US also has serious problems to contend with, $$ weakness should be no surprise. People on here & other commentators on twitter think the euro must get vertigo in the 1.3 region, however it went well into the 1.4 region last year. Point being, it would be dangerous to enter a heavy short in the 1.3 region thinking it can't head much higher. While Bernanke is at the Fed, anything can happen. Basically, the best approach is to through all pre conceptions about fair value, maximum possible price etc out of the window. Just follow the PA

PS: I was taught a harsh lesson earlier in the year about getting long/short biased, but ultimately it makes you a better trader if you learn

Mate, this writer can be right ONLY if the price drops below at the very least 1.3100 on Monday morning... I very much doubt that and I think he is badly mistaken. We may see below 1.3100 sometime next week but not Monday. The sooner you accept that the short term trend has changed the better. Many of us-including myself- were literally shouting to short the cripple but look where we are. We are only a few pips far away to break the double top and 1.3500s are well in the cards now. We may retrace some even below 1.2900 this week but this doesn't change the fact that the writer obviously is mixing fiction from truth. The so called market makers - as far as I know there are 14 - are obliged to give quotation during the week; may it be a European or US or Asian banks. Is Deutsche Bank a European Bank...? Yes.. OK. Do they shut down the shop when Europe closes...??? No. They have probably their biggest trading room in NY. There may be short squueze or any other trading plans of some institutions but if you expect the price to drop straight away you are sadly on the wrong side... Just a tought for the weekend.

Another technical view:
http://www.actionforex.com/analysis/...0121215180620/

I know its not your opinion. But I don't belive in this.
Why did price stayed there at 1,3170 ? He says becase nothing was really going on, so it stayed there.
Price goes where there is liquidity. If someone were to sell at that level and no demand enough there then price must go down. Price didnt go down. so. OR no one is selling there, or there is selling and is being absorved. Anyway for him to be right then it would sell off in monday and I don't think that is the case.

And its just stupid for someone to buy so much euros if there was supply at these levels only to take out some couple of stop losses that would only create more buying, so you end up being the sucker, holding euro at these prices ? do you really think people would be this risky ?

I've read a lot of things about this move and so far the best one is this one.
THIS MOVE IS WHAT RUSHING TO THE EXITS LOOKS LIKE. I feel glad I got to experience this as a trader. I think it will be good for me, It could be wrong and sell off on monday but I don't think so.

Well said....at any rate you gotta hand it to him...the writer has a really vivid and vibrant imagination. He/she should try his hand at being a movie director...would make a great and entertaining movie...

Players who are able to move the markets by this magnitude, do it on a rotational asset allocation basis...so yes Gold might be "lagging" maybe because it's conceived to be at an elevated level already as it is and greenback overvalued relative to the euro considering the announced magnitude of the loosening of monetary policy....this the closest fundamental underpinning for this extended move that we had coming from the CB this week...

But remember all these fundamental rationales might be a temporary excuse or you might call it the "fuel" to take the price beyond certain technical levels that would otherwise not be feasible to break under ordinary circumstances...this is the picture we've got for the time being until the next fundamental/technical confluence juncture....

It was probably written by a depressed analyst who kept on giving advice to short the cripple and was shocked with the move just before the weekend. There are so many failures in the text, he believes a european market maker is like a retail bank at the corner of Wood Street and shuts down at 17:00. Also the "stop hunting" I know, is done pretty quickly and the price comes back to where it was or much below before the hunt and you don't close the price above the monthly pivot The price may drop, no doubt. This is market but the context is clearly misguided and is no help to understand why the price moved to the upside. May it be a bullish or bearish week, one should clearly detach him/herself from emotions. This is one of the things I learned from some very good traders here. I am still working on it tough... Very difficult to do...

It really doesn't matter WHY she moved the way she did...all that matters is that she did...
For all we know the next move will have different characteristics and a different reasoning behind it, so it's utterly futile to engage in speculation as to why or who moved the market.....makes no difference to the move...

Ath the end of the day all we know for sure is that the market moved and HOW it moved and make the best of it...