The euro had company in the dog house as the pound matched its decline in August.
FX returns vs USD in August
Volatility picked up in the month but the overall move of just 2% in the best trade (EUR/AUD shorts) shows that the overall moves were huge. It also emphasizes the usefulness of following the trend. The pair has now declined in 5 of the past 6 months.
Will it fall again in September?
EURAUD monthly chart
The pair is testing the Nov 2013 low, the psychological 1.40 level and also closing in on the 100-week moving average at 1.3390.
I expect to see continued declines but I’d prefer to sell a bounce near 1.42.
