Eur/USD

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I've had enough for now. Out at 1.2804. +121 Points. I will wait for the big news tommorrow and see if the rocket ship takes off.

Good trading everyone.

DRT

Quote from downrivertrader:

Well the 2837 level held last night. We are working the 2777 area as of 11:00 today. This is about where I had planned on getting long and it sure looks like it wants to explode out of here. I am staying short with a move back above 2800 convincing me to close up. If we somehow get thru the 2750 value area, then a move down from value, my short will have more of chance to make some serious profit I think.

Still short from 2925.

DRT
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My call is still that they'll hike 25bps, and the press conference will yield Trichet speaking in a neutral tone. This should, and I emphasize "should", cause a sell off in EUR. The next ECB hike, at this point and given EUR strength, politics and data, be sometime late 3Q.
 
So is the press conference the event instead of the actual hike? Assuming they hike 1/4 % that is.

I hate when he speaks....you just never know what he is going to say when they ask a question?

I can hear it now...."What about the strong Euro Ms. Trichet? Will this have any influence on your future moves?"



DRT
 
The initial disappointment from some market kooks that a half point raise doesn't occur will make some movement. But the press conference is a long, drawn out event afterwards and after Mr. T tells the market he "pities the fool that raises rates too high" they'll back off even more.

Of course I could be the kook and they could raise a half point. But I seriously doubt that - since they know it'll send the Euro to the moon, and that's not what they want.
 
As I expected, quarter point. Now let's see if the rest of my prophecy was true, and Trichet talks neutral going forward with a "we'll need to be viligant, but data dependant" type speech.
 
And there it is:

"Boston, June 8. Trichet is suitably hawkish in his initial comments, saying growth the Eurozone is re- accelerating and that rates remain low and accommodative. Surely future hikes are ahead, but timing remains unclear at present. EUR/USD is off lows at 1.2670/73 but holding below 1.2695/00 resistance. Its average growth forecast is unchanged at 2.1% in 2006 and says it is closely monitoring developments. Sounds like they too are data-dependant."

And bing, EUR/USd drops below its 1.2675 mark.
 
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