Well, my thinking here for the day is that we are going to push up to a new high not yet seen this week in eur/usd.
so, i’m trying to figure out just how deep the rabbit hole goes.
I see it like this. with the immediate pressure off the euro, eur/usd will likely be pushing up. But, no one is fooled into thinking that there won’t be more issues to come.
and many large specs are already (at least in large part) net short the euro.
So. the logical move if you were net short a large position, and you felt price was going to start drifting upwards…you’d ideally like to cover some or all of your position, at the cheapest price possible…
except, it’s gonna cost you a bit to do that. the cost to absorb resting orders in the market to push into the stops that will provide you the liquidity you need to fill up on the cheap…
anyway, i don’t want ot carry this train of thought out too far here. I don’t need to, in order to understand the dynamics…and to also understand that price action and volume will completely give the large specs hands away.
except without knowing both the magnitude and positional direction of their intentions…its still a decent amount of guessworlk.
Depending on how they play this…what stops they push into first…and how deep they push before price turns… will give some clues as to the magnitude and direction of their ultimate interest…but, a lot of guesswork here. kinda like figuring out the bluff of some unknown poker opponent.
When in doubt, I fall back on 2 things:
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we are in a daily supply zone
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the sentiment bias is long.
So, we’ll likely end up not losing much from friday… but we will likely pull back down in the meantime.
I’d love to catch that bottom.
1.3650ish…here i come.
Jay
Even more convincing if we can pop stops up top, and quickly fall back to the other end of this range here. Say a push to 1.3820, and drop back down below 1.3770…i’d bet on good solid continuation of that downmove, at least until we hit the mid to high 3600’s.