Friday, July 1, 2011

US Stocks and EUR/USD Both Due For Pullback

US stocks and the Euro saw impressive relief rallies following the Greek votes this week. However technically both are pushing up against strong resistance on the daily charts. As well commodities are weak across the board this am which should put downward pressure on EUR/USD.
We should see at a minimum a nice pullback in each of these today. Whether the pullback will be the start of a larger leg back down remains to be seen. If both trade much above futures overnight highs then my view will be invalidated. But right here looks like great risk/reward shorts in my opinion. I shorted S&P futures at 1316.50 and added to EUR/USD short @ 1.4495 this morning (note S&P futures trade at about a discount to the cash index).

S&P 500 - Cash Index


No comments:

Post a Comment