Wednesday, September 14, 2011

EUR/USD sellers are lining up

They are just waiting for retraces, fibs, trendlines, resistance levels, bad news, downgrades, defaults, you fill in the blank, to sell the Euro. After 10 big handles were shaved off the currency, it is practically impossible to find any bulls around. All levels were sliced through with such force that anyone staying in the way was obliterated. Now all I hear is how everyone wants to sell EUR/USD, and they are all looking at the same levels of resistance to enter the short. My question is: if everyone wants to sell or has already sold, is it so oversold that short-covering rally will take it much higher than anyone expects? Obviously it will not take much of good news to send many shorts packing. Largest rallies sometimes occur in bear markets. Let's see what happens...

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