It looks like today is the pay day for the long EURUSD - short SPX strategy I've been carrying for a month or so as further to bad Non-Farm Payrolls figures (-131K vs -65K estimated while the unemployment rate stays at 9.5% vs 9.6% est) and as I write the EURUSD jumped from below 1.32 to above 1.33 and the S&P 500 dropped from above 1120 to below 1110. Bad US economic data, that's essentially what the strategy has been about...On the one hand, those bad figures push the US stock indices down, I'd say a bit obviously. On the other hand, they tend to break the positive correlation between the EURUSD and the US stocks pushing the currency pair up as the market anticipate further QE from the FED while the ECB rhetoric could be more about tightening and exit.
Well the pay day may be today but let the profit run, so let's postpone the "settlement day" to later, hopefully next week.
Have a good weekend my Fellow Traders!
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FYI As this post is published: SPX 1110 // SX5E 2779 // NKY 9489 // DAX : 6259 // EURUSD 1.3270 // USDJPY 85.25 // XAUUSD : 1206
August 06, 2010
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