The EUR/USD has been flirting with the downside since this morning.
Despite falling over 100 pips yesterday post Draghi, there has been very
little attempt to stage a rebound.
There are two ways to interpret this. One is to conclude that the EUR
will break 1.28 tonight post NFP and drop like a rock, or it can be a
way to make traders think it will do so, get them to short the Euro
before promptly reversing and making a break to the upside.
From what I have seen in these past few months of very curious trading
behavior, I have a feeling that it might be the latter.
Ideally though I would opt to sit this one out due to the critical
nature of this particular release (more on this at a later post) but I
have an open long position in EUR so I have to buckle down and weather
the storm tonight. I am seriously considering hedging with a small short
as well so that in case my long is taken out, it won't be a total loss.
At this point its close to T minus 240 minutes.
Scary.
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