anyone else thinking that Euro appears high in this pair? 14900/1500 good resistence areas. time to short Euro soon here me thinks. there is "talk" however, of either Euro or Yuan being the new reserve currency? Discuss - haha
Bahman, as I am sure you are aware, that has been discussed for a long long time - Saddam wanted to get onto dealing oil for EUR - if it happens, it won't happen in one shock. I think that there is a strong case for a country to hold reserves of EUR/CHF/CNY/USD. Of course, if the USD ceases to be the reserve and devalues sharply then China will be hammered as they hold so much. In short, I agree that EUR is too high against USD, GBP and a number of others.
Monaco - that is the main reason, IMO, why the USD won't be ousted anytime soon from it's perch as nr1 kid on the block: China holds too much dollar. I'll be waiting for EUR/USD to hit 14800 before opening short ATB
Bahman, I think you have two things working for you; the EUR is improbably high and the USD has had (some of) the stuffing kicked out of it. [I prefer the EUR/GBP short because I prefer to make and bank GBP at the moment. As an aside to this discussion, which is more about pairs than direction, it would seem illogical to aim to make profits in the currency one expects to devalue.]
Monaco - lol: "it would seem illogical to aim to make profits in the currency one expects to devalue" we are traders trying to earn a living - shorting (though illogical) is fun and allows profit, as you say! STILL WAITING for EUR/GBP - our time will come!! (i shall be increasing my position at 10600 for long GBP/EUR)
Bahman, perhaps you did not understand me. If one wants to make money out of Euro going down (from charting, wuishing to hedge being paid in Euro or for whatever reason) one needs to pick the pair. You want to pair with USD in this instance, I pair with GBP. I have two instruments at my disposal: I can long GBP/EUR and make EUR or short EUR/GBP and make GBP. I choose the one that will make GBP because that is what I believe will appreciate, and what I want to earn. I hope that is clearer - assuming that things play your way, you want to earn what will be worth more.
The opposite of your play would be a guy who is based in Euro buying Gold with USD, waiting for Gold to go up and getting more USD than he paid but changing back into EUR and getting less than he started with! Some people around here (S of France) are happy to sell their house for fewer EUR than they paid because it will still buy more GBP than they paid.
I have not taken the EUR/USD pair into my portfolio but am considering the following: I have a fair bit of EUR (cash in bank) that makes me nothing and I have no use for. I can buy physical gold with it and I reckon that in two years, even if the price does not move above $1050/oz, it should still buy more than €700/oz.
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